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JAXX achieves 19 percent growth in 2011 through sports betting and casino

JAXX SE / Key word(s): Final Results

30.03.2012 / 09:54

JAXX achieves 19 percent growth in 2011 through sports betting and casino

- Consolidated revenue for 2011 rises to EUR 60.7 million

- Change of name to mybet Holding SE planned

- Granting of Schleswig-Holstein licence expected in April

Kiel, March 30, 2012 - The gaming specialist JAXX SE (Deutsche Börse Prime Standard; ISIN DE000A0JRU67) increased its revenue by 19 percent to EUR 60.7 million in the past financial year of 2011 (2010: EUR 51.2 million). Gross revenue (revenue + winnings paid out) came in at EUR 190.2 million (EUR 154.1 million), this being towards the upper end of the forecast range of EUR 170 to 200 million. Earnings before interest and taxes (EBIT) were improved significantly by EUR 5.4 million, from a loss of EUR -3.8 million in the previous year to a profit of EUR 1.6 million in the 2011 financial year. Excluding written-off accounts receivable of around EUR 0.3 million necessitated by the continuing difficult economic situation in Spain, earnings were likewise at the upper end of the expected spread (EUR 1.0 to 2.0 million).

Whereas the previous year had closed with a net loss of EUR 4.2 million, a net profit of EUR 1.5 million was achieved in 2011. Earnings per share rose correspondingly to EUR 0.06 (EUR -0.21).

mybet the key to sustained high growth

Sports betting again brought in the greater part of consolidated revenue in the 2011 financial year; it accounted for 41 percent of the total for the group. Compared with the previous year, sports betting, which is underpinned predominantly by the mybet products, was up 18 percent at EUR 25.1 million (EUR 21.3 million). Growth was hampered by a weak bookmaking margin in the first half of 2011, which led to a noticeable drop in the margin over the year as a whole from 19.2 percent to 17.2 percent.

The revenue increase in the Sports Betting segment is attributable to a sharp increase in the number of users and significantly higher per capita revenue. The number of registrations rose from 724,000 to 862,000 over the year, and the average betting stake per active customer increased from EUR 188 to EUR 298. As a result of optimisation of the shop structure, the number of betting shops under the mybet franchise slipped to 501 (2010: 512) as at the end of 2011. The total number of mybet shops in Germany rose from 221 to 275. At the same time revenue from shop operations increased significantly.

Revenue from casino and poker games, which are again generated mainly with mybet products, climbed by 32.9 percent to EUR 17.1 million (EUR 12.9 million) in the 2011 financial year. Revenue from lottery products was maintained on a par with the previous year at EUR 13.7 million. Profitability has improved substantially following the slimming-down of this area. In January 2012 JAXX signed a provisional agreement with a group of investors on the sale of its lottery operations in German-speaking countries. The price envisaged is EUR 12.5 million. It is expected that the sale will be completed in April.

It has not yet been possible to dispose of the interest in pferdewetten.de AG, which is now once again included in the 2011 JAXX Consolidated Financial Statements as continuing operations. The successful restructuring of pferdewetten.de AG meant that revenue for the Horse Betting segment leaped 63 percent to EUR 4. million (EUR 3.0 million).

Improved liquidity position

The liquidity position of the JAXX Group further stabilised in the 2011 financial year thanks to a rise of EUR 5.8 million in cash to EUR 7.2 million. The biggest changes result from the capital increase in March, which brought in around EUR 6.0 million, and from the repayment of the EUR 5.9 million 2007/2011 convertible bond, as a result of which the JAXX Group is now largely debt-free. The equity ratio rose from 41.2 percent to 60.7 percent.

Focus on sports betting, casino and poker as mybet Holding SE

The 2012 financial year will see the JAXX Group acquire an even sharper profile. Along with the planned sale of lottery operations in German-speaking countries, business will become even more strongly focused on sports betting, casino and poker products under the mybet brand. The rights to the JAXX brand are also up for sale. The Ordinary Shareholders' Meeting of JAXX SE convened for May 24, 2012 will therefore be asked among other things to pass a resolution on the renaming of the parent company as mybet Holding SE.

JAXX expects Schleswig-Holstein licence to be granted in April

With regard to the regulatory situation, the legal position in Germany in 2012 is likely to remain non-uniform. Now that the EU Commission has renewed its criticism of the draft State Treaty on gaming of 15 federal states, it is once more possible that a common approach for all federal states will be found. Since January 2012, Schleswig-Holstein has been the only German state to have EU-conform legislation, on the basis of which it has been possible to grant licences for sports betting, casino and poker since March 1, 2012. JAXX SE has already submitted a licence application on behalf of its subsidiaries. JAXX expects the licence to be granted in April.

Regulatory developments hinder specific earnings forecasts

The economic development of the JAXX Group is dependent to a high degree on further regulatory developments. Although business has already been very lively in the first few weeks of the new financial year, no precise forecast for revenue and earnings expectations is possible, and any such forecast would be rather speculative. Rather, the various scenarios give rise to a corridor of expectations which needs to be defined relatively broadly. After the disposal of lottery operations, revenue for the 2012 financial year is likely to be in the order of EUR 60 to 70 million. The deregulation of the market in Germany and the increased tax and marketing expenditure that this would involve could lead to a negative result for the 2012 financial year. The forecast bandwidth for EBIT ranges from EUR -4.0 to +4.0 million.

Key figures for 2011

  2011 2010 Change
  EUR '000 EUR '000 %
Gross revenue 190,152 154,075 +23.4
Revenue 60,686 51,189 +18.6
Sports Betting 25,096 21,300 +17.8
Casino & Poker 17,100 12,863 +32.9
Lotteries 13,667 13,562 +0.8
Horse Betting 4,847 2,979 +62.7
EBITDA 6,871 546 +1,158.4
EBIT 1,633 -3,814 n/a
Consolidated earnings 1,499 -4,170 n/a
Earnings per share (EUR) 0.06 -0.21 n/a
  31/12/2011 31/12/2010  
Cash holdings 7,187 5,798  
Shareholders' equity 22,763 15,015  
Equity ratio 60.7 % 41.2 %  


The 2011 Annual Report will be published and available for downloading 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, Italy, 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 best-known brands of the JAXX Group include the sports betting provider mybet.com. The shares of JAXX SE have been traded at Deutsche Börse since 1999 under ISIN DE000A0JRU67.

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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