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JAXX increases gross revenue to more than EUR 122 million


JAXX SE / Key word(s): Quarter Results

10.11.2011 / 09:06


JAXX increases gross revenue to more than EUR 122 million

- Nine-month revenue for 2011 up 16 percent to EUR 40.6 million

- Sound growth and optimised costs lead to turnaround in Q3 2011

- EBIT forecast of EUR 1.0 to 2.0 million for full year confirmed

Kiel, November 10, 2011 - JAXX SE (Deutsche Börse, Prime Standard, ISIN DE000A0JRU67) today publishes its 2011 Nine-Month Report. The figures reveal that the Kiel-based financial holding company that invests in companies in the European gaming industry increased its gross performance by 31 percent in the first nine months of the current financial year, to EUR 122.2 million (9M 2010: EUR 93.1 million). As a result of the year-on-year weaker bookmaking margin for sports betting business, there was a below-average rise in revenue for the continuing operations of 16 percent in the first nine months of the year, to EUR 40.6 million (9M 2010: EUR 34.9 million).

Thanks to a strong third quarter, the nine-month EBIT improved from EUR -0.9 million to EUR 0.8 million. The nine-month period brought a net profit of EUR 0.5 million, in contrast to a net loss of EUR 2.2 million in the equivalent period of 2010.

Sound growth, steady margins and an optimised cost basis produced one of JAXX's best ever quarterly results in Q3 2011. Revenue rose by 26.2 percent from EUR 10.8 million to EUR 13.7 million, and EBIT improved by EUR 2.5 million compared with the prior-year quarter to EUR 1.0 million. Whereas the third quarter of 2010 had closed with a net loss of EUR 1.5 million, a net profit of EUR 0.7 million was achieved in Q3 2011.

The successful turnaround was based on continuing strong growth in sports betting, casino and poker business, along with a now highly profitable lotteries area, which was still a loss-making venture last year.

Following a raft of measures taken in the first half of the year to raise brand awareness of the sports betting portal myBet.com, the marketing budget was scaled back again in the lower-revenue summer months. The overwhelming majority of online marketers are still distinctly reluctant to act until the future regulatory framework has become clearer.

Although the number of new customers was increased by a further 29,000 in the third quarter to a present total of 828,000, this growth fell short of the original target due to the limited marketing options. Nevertheless, the average number of active online customers per month has risen again slightly to 16,090 compared with the previous quarter. In addition, myBet.com has succeeded in significantly increasing the customer value.

The number of myBet betting shops climbed to 526 (previous year 465) in the third quarter. Of this total, 280 were in Germany (previous year 187).

Outlook

In September the state parliament of Schleswig-Holstein in Kiel passed new gaming legislation that envisages extensive liberalisation of the gaming market in Schleswig-Holstein from 2012. JAXX SE's subsidiaries would be able to use the licences issued in Schleswig-Holstein, which are scheduled to be valid from March 2012, to operate throughout the remainder of Germany.

It came as no surprise that the remaining 15 Prime Ministers finally made tentative progress compared with their draft from April at their most recent meeting in late October. With a concession fee reduced from 17 to 5 percent of betting stakes, JAXX's myBet betting shops would actually benefit in particular measure from the latest draft because the levy was kept higher for offline business.

However, it is already apparent that even this revised draft will not stand up to scrutiny under European and constitutional law. The continuing restriction to an arbitrary 20 licences, the ban on online casino and poker games and the argument that the lottery monopoly can be justified by the need to combat addiction are attributes that have already come in for stiff criticism from the EU Commission and the courts.

In advance of the final approval of the State Treaty on gaming in December, Schleswig-Holstein logically enough announced that it is unable to sign up to it as it stands.

At European level, JAXX is preparing to venture into the Italian and Spanish markets. Both markets offer the JAXX Group considerable growth potential against a backdrop of rising customer values.

In the fourth quarter, a full programme of football and the critical phase of Spain's Christmas lottery will traditionally yield a further increase in revenue. Provided bookmaking margins stabilise at a healthy level, a clearly positive result is expected in the final quarter of the year, too.

Overall, the Management Board confirms its forecast for the 2011 financial year. Gross revenue should be between EUR 170 and 200 million, and EBIT between EUR 1.0 and 2.0 million.

Key figures for 9 months / 3rd quarter of 2011 (continuing operations):

  9M 2011 9M 2010 +/- Q3 2011 Q3 2010 +/-
  EUR '000 EUR '000 % EUR '000 EUR '000 %
Gross revenue 122,157 93,085 +31.2 40,747 29,424 +38.5
Revenue 40,550 34,890 +16.2 13,662 10,828 +26.2
Sports Betting 16,521 14,953 +10.5 5,975 4,671 +27.9
Casino & Poker 12,554 8,824 +42.3 3,489 3,018 +15.6
Lotteries 10,329 9,868 +4.7 4,007 2,964 +35.2
Net gaming revenue (NGR) 40,138 34,503 +16.3 13,506 10,279 +31.4
EBITDA 4,004 1,989 +101.3 2,141 -531 n/a
EBIT 802 -913 n/a 991 -1,511 n/a
Consolidated earnings 512 -2,203 n/a 638 -1,529 n/a
Discontinued operations 78 -728 n/a 45 -229 n/a
Earnings per share (EUR) 0.01 -0.13 n/a 0.02 -0.08 n/a
             
  30/09/11 31/12/10        
Cash holdings 10,301 5,500        
Shareholders' equity 20,638 13,933        
Equity ratio 47.1 % 38.2 %        

 

The Nine-Month Report will be made available for downloading in the course of today on the websites www.deutsche-boerse.com and www.jaxx-se.com.

About JAXX:
JAXX SE, listed in the Prime Standard of Deutsche Börse, is a financial holding company with holdings in international companies in the gaming industry. JAXX currently holds interests in companies in Germany, the UK, Spain, Austria, Malta and Belgium. JAXX SE has its headquarters in Kiel. The holding companies cover the entire spectrum of the games and gambling industry. Depending on national regulatory structures, they broker or market sports and horse betting, lotteries, and casino and poker games. The shares of JAXX SE have been traded at Deutsche Börse since 1999 under ISIN DE000A0JRU67.


Contact:
JAXX SE
Investor Relations & Corporate Communications
Stefan Zenker
Tel. +49 (40) 85 37 88 47
Fax +49 (40) 85 37 88 30
Mail stefan.zenker@jaxx.com



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145624  10.11.2011