mybet confident of securing German national licence; maintaining strong growth

Germany’s mybet Holding has reported an 8 per cent increase in total revenues to €20.0m for its first quarter of 2013, following strong growth from the company’s online operations.

mybet said that strong growth in its sports betting, casino and poker products compensated for the loss of income from its lottery operations sold during 2012.

Q1 2013 Revenues

Betting stakes placed on mybet’s online platform rose 28 per cent to €26.3m, generating hold of €4.4m, up 45 per cent year-on-year.

Total sports betting revenues were up 14 per cent to €11.0m, with overall growth held back by weaker business in mybet’s retail betting operations, which the company attributed to ‘teething’ troubles with new shop software needed for sales operations in licensed markets.

Betting stakes in retail shops fell by 14 per cent to €21.7m during the quarter, with hold remaining constant at €6.3m due to an improved bookmaker’s margin.

The company benefited from a strong performance from its online casino and poker products, with revenues increasing 39 per cent to €6.6m. This offset a 66 per cent drop in lotteries revenues to €0.9m and a 23 per cent decline in horse race betting revenues to €1.1m.

At the end of the quarter, mybet had 57,500 active online customers, an increase of 54 per cent compared to the previous year, from a total registered customer base of 1.1m, up 5 per cent year-on-year.

mybet generated EBITDA of €0.8m during the quarter, down 74 per cent versus a year ago, due to the loss of income from lottery operations along with increased investment on marketing and the company’s technical infrastructure. As a result, consolidated earnings dropped 74 per cent to €0.4m.

“The increased investment outlay for marketing and IT in the first three months of the financial year have prepared the way for further growth and increased profitability,” said mybet in a statement Monday. “The company moreover has a very good corporate structure in human resources and organisational terms.”

mybet said that it will benefit from this investment in the second quarter, with the company expected to maintain the high growth in its core business areas of sports betting, casino and poker.

The company will also launch its own branded flagship retail stores during the course of 2013, with a total of approximately 50 or 60 shops expected to be introduced across Germany in the next two to three years.

For the full 2013 year, mybet expects consolidated revenues to reach €80.0m to €87.0m, generating EBIT of between €2.5m and €3.0m.

Mybet added that it remains confident that it will be granted a national licence in Germany, despite missing out on the initial hearings involving 14 companies in March.

mybet said that it believes it satisfied all the minimum requirements, having submitted its licence application to the Hesse Ministry of the Interior in January.

“However, observers of the licensing process have commented that the requirements laid down in the bidding process were to some extent misleading and contradictory, resulting in misinterpretations,” saide the company.

Having missed out on the first wave of hearings, mybet believes that the Ministry will hold further hearings in the near future.

“An initial lawsuit brought before the Hesse Administrative Court to achieve precisely this was successful,” said the company. “mybet still firmly expects to be granted one of the nationwide licences.”

As at March 31st the company held cash and cash equivalents of €11.6m compared to €14.9m at the end of last year.

Shares in mybet Holding SE (Co. Data) (XETRA:XMY) are currently trading at €1.33 per share in Frankfurt this morning.