World Gaming Archiv News

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WORLD GAMING plc ANNOUNCES RESIGNATION OF CTO
LONDON, UK, January 9, 2004 - World Gaming plc. (OTC BB: WGMGY), a UK-based Internet-gaming software and e-business services group of companies (the Group), today announced the resignation of its Chief Technology Officer, David Fleming.

Mr. Fleming has submitted his resignation as a member of the Board of Directors and as Chief Technology Officer with effect from January 16, 2004. The Board extends its appreciation for Mr. Fleming's efforts over the last 2 years of service.

The Board is now in the process of electing a new Chief Technology Officer. As an interim measure, the Board will continue to utilize the services of a recently appointed Consultant to the Group under the direct supervision of Daniel Moran, the Group's CEO. This interim combination means that vital strength in leadership and skill will endure within the IT and Development areas of the business.

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WORLD GAMING plc ANNOUNCES FOURTH QUARTER TRADING STATEMENT
LONDON, UK, January 26, 2004 - World Gaming plc. (OTC BB: WGMGY), a UK-based Internet-gaming software and e-business services group of companies (the Group), is pleased to announce a trading statement in respect of its fourth quarter ended December 31, 2003.
Highlights

Strong net win achieved by the Group’s licensees.
Continued stability in the Group’s operating platform.
Earnings per share before interest and depreciation expected to exceed 9 cents per share full year (2002: loss per share 7 cents).
Stable operating cost base maintained.
Restructuring initiatives commenced within the Information Technology division.
Successful launch of the Virtual Games product suite.
Concentrated development efforts on horse-racing product suite.

Trading Update
The fourth quarter is historically our Licensees’ busiest trading period facilitated primarily by the US based sporting calendar. In addition, the casino product suite also increases significantly in volume of wagers.

Throughout the second and third quarter the staff and management worked vigorously to ensure that both the Group’s product and infrastructure was sufficiently able to handle the busy winter sports calendar. The Board invested in a new Oracle 9i platform, enhanced its casino product suite and invested significant resources in creating a stable and reliable operating environment. This strategy would best allow our Licensees to increase volumes and market share during this period.

As a result of this ongoing strategy together with strong net win by our Licensees, the Board is pleased to announce that all key performance indicators of the Group exceeded budgeted expectations.

In summary, earnings per share before interest and depreciation for the quarter are expected to exceed 6 cents per share (2002: 5 cents per share). Full year earnings per share before interest and depreciation are expected to exceed 9 cents per share (2002: loss per share of 7 cents).

Earnings per share after interest and depreciation for the quarter are expected to exceed 5 cents per share (2002: 3 cents per share) and exceed 5 cents per share full year (2002: loss per share of 16 cents).

Earnings per share estimates are on the basis of unaudited financial statements. The Board anticipates releasing the Group’s audited financial statements together with its 2003 20-F SEC filing on April 5, 2004.

Operational Update
Consistent with the planned release date, the Group launched the Virtual Games product suite during the quarter. The uptake by licensees has been progressive with further licensees expect to take the product live in the first quarter.

As discussed in our release for the third quarter, the Board has continued its review of areas within the business that require enhancement, or those that are not congruent with the Group's core business. We have commenced a restructuring program within the Information Technology and Development area of the business to ensure focus on delivery of quality products on a timely basis to our licensees.

Further stages of development have been completed for the delivery of an expanded horseracing product. The release date is expected towards the end of the first quarter of 2004.

The Group has begun talks with a third party to enable delivery of a multi-player poker product for the summer of 2004. Development is expected to commence within the first quarter of 2004.

Daniel Moran, CEO stated:

“The results for the year are encouraging. During the year the new Board has worked towards constructively dealing with matters that were of direct detriment to the Group’s viable future. As we deal with these matters and improve efficiencies within the business, the results begin to present themselves through improved trading and a strengthening balance sheet position.

The development schedule for 2004 provides exciting new product opportunities for our licensees. We are committed in continuing to enhance the Group’s product and infrastructure to enable our licensees to grow their businesses.”

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WORLD GAMING plc ANNOUNCES APPOINTMENT OF AUDITORS
LONDON, UK, January 29, 2004 - World Gaming plc (OTC BB: WGMGY), a UK-based Internet-gaming software and e-business services group of companies (the Group), is pleased to announce the appointment of HJ & Associates LLC, an independently owned member of the RSMI McGladrey international network of firms (“HJ&A”), as its principal independent auditors. HJ&A had previously served as the Group’s principal auditors in three reporting periods prior to 31 December 2002.

Upon the recommendation of the Audit Committee, the Group’s Board of Directors selected HJ&A as the Group’s principle auditors for the year ending 31 December 2003 and thereafter. The Shareholders of the Group will be asked to confirm this appointment at the 2004 Annual General Meeting of Shareholders or sooner if a Shareholders’ meeting is convened for any reason.

HJ&A is a member of a worldwide network of audit and accounting firms which will enable the Group to seek advice and meet relevant reporting requirements in all of the jurisdictions in which it operates, including the requirements of the US Securities and Exchange Commission and the NASDAQ OTC.BB Exchange on which its shares are traded.

Baker Tilly, a member of Baker Tilly International, the Group’s auditors for 2002, has submitted its resignation and, accordingly, HJ&A will begin its engagement immediately.

James Grossman, Chairman of the Audit Committee, stated:

“The Audit Committee considered three different firms including the auditors for this past year and made the decision to recommend HJ&A after careful consideration of a number of issues. It was felt that a firm of auditors based in the United States with significant SEC reporting experience will be most advantageous in ensuring the Group meets its reporting and statutory requirements in a timely manner. As reporting and corporate governance requirements become more rigorous, it is imperative that the Group continues to have professional service providers in relevant jurisdictions in order to assist the Group in its obligations to Stockholders and regulatory bodies.”

Contact:
Investor Relations
World Gaming plc
[email protected]

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WORLD GAMING plc REPORTS FOURTH QUARTER AND FULL YEAR 2003 RESULTS

LONDON, UK, April 5, 2004 - World Gaming plc (OTC BB: WGMGY), a UK-based Internet-gaming software and e-business services group of companies (the “Group”), is pleased to report financial results for the three months and full year ended December 31, 2003.

Highlights
Full year net profit of $2,958,000 or 7 cents per share vs. loss of $5,318,000 for the same period last year or a loss of 16 cents per share.
Net profit for the quarter of $2,934,000 vs. loss of $593,000 for the same period last year.
Full year profit before interest and related items and depreciation of $5,245,000 (12 cents per share) vs. loss of $2,197,000 (loss of 6 cents per share) for the same period last year.
33% increase in wagering volume in the quarter when compared to the same quarter last year.
Royalty revenue grew 7 percent for the year ended December 31, 2003.
Operating expenses including interest and depreciation down 34% for the year ended December 31, 2003.
Settlement of certain legal claims and capital lease obligations.
Working capital deficit reduced from $5,581,000 at December 31, 2002 to $126,000 at December 31, 2003.
New Casino games and Virtual Games released during the year with further products scheduled for release.
Fiscal results
Total revenues for the quarter ended December 31, 2003 grew 22% to $7,357,000 compared to $6,043,000 for the same period last year. Together with a 33% year on year increase in the volume of wagers processed on our systems in the quarter, the increase is also attributable to royalties received as a result of the strong net win achieved by our licensees. Stable deposit processing gateways further assisted the increase in wagering volume for the quarter. The Group experienced a 9% increase in royalty revenues in the quarter when compared to the same period last year.

Total revenues for the year grew $921,000 or 5%. This growth was driven by a 7% or $1,056,000 increase in royalty revenue and a 56% or a $634,000 increase in transaction processing revenues. Revenues in respect of new license fees fell $658,000 as the Group did not seek to sign new licensees in the year. The increase in royalty revenues occurred despite the impact of losing a licensee in May, who at that time contributed 6% of total revenues. Increased transaction processing fees in the year represent the increase in revenues from on-charging higher processing costs from suppliers, charges that our licensees were finding increasingly difficult to sustain.

In February 2004, the Group closed transaction processing and customer service divisions of the business. This closure affected less than 6% of total deposit volume on behalf of licensees and is expected to contribute a further $600,000 in profits through shedding this ineffective and loss making aspect of the business.

There was no revenue from new licenses for the year as the Group continued to focus on existing licensees during the year. As the enhancement of its platform and product suite continues, the Group expects to widen its focus to once again include marketing to new licensees, but only to the extent the Group is in a position to fully support such licensees.

For the year ended December 31, 2003, total system-wide wagers grew 12% to $3.8 billion from $3.4 billion in the prior year.

Net profit for the quarter ended December 31, 2003 was $2,934,000 or 7 cents per share compared to a net loss of $593,000 or 2 cents loss per share. The increase in net profit in the quarter driven by increased revenues also reflected the results of restructuring that has brought the Group’s cost base to more manageable levels.

Net profit for the year ended December 31, 2003 was $2,958,000 or 7 cents per share compared to a loss of $5,318,000 or a loss of 16 cents per share in the prior year.

The gross margin for the quarter was 87.9% as compared to 92.5% for the same period last year. For the full year, gross margin was 87.9% as compared to 89.9%. The decline in gross margin represents the heightened direct costs attributable to the transaction processing division of the business that was closed in February 2004.

Operating expenses including interest and depreciation decreased 42% to $3,551,000 during the fourth and final quarter of 2003 compared to $6,142,000 for the same period last year. This decline primarily consisted of a 95% reduction in bad debt write-offs or provisioning, a decline in professional fees and a decline in depreciation charges as many high-value assets became fully depreciated in the quarter.

For the full year ended December 31, 2003, operating expenses including interest and depreciation declined 34% to $13,421,000 compared to $20,483,000 for the same period last year. Efforts to reduce operating costs continued throughout the year with the primary contributors to this reduction being:

Bad debts for the year ended December 31, 2003 decreased 90 percent or $3,056,000 compared to the same period last year. Last year the Group experienced significant write-offs in failed transaction processing routes. The failure of these routes typically occurred due to implementation of transaction processes that lacked transparency. Improved due diligence procedures and reinforcement of risk sharing policies with licensees has resulted in a significant reduction in this cost in the year ended December 31, 2003.
Depreciation expense decreased 39% or $1,235,000 when compared to the same period last year. This reduction was the result of a number of significant assets becoming fully depreciated in the third quarter of 2003.
Communication costs decreased 46% or $397,000 when compared to the same period last year as contracts with certain suppliers were cancelled or renegotiated and the use of voice-over IP telecommunication was utilized.
Salaries and wages decreased 10% or $670,000 despite severance costs incurred on a number of senior employees in the year.
Professional fees declined 22% or $390,000 as litigious matters requiring third party advice declined and other advisors were not utilized or changed.
Other corporate overhead including occupancy costs, board expenses and travel declined 30% or $1,314,000 when compared to the same period last year through initiatives such as relocation or closure of offices and renegotiation or changes in certain supplier accounts.
As a result of settling a number of significant capital lease obligations in the year, the company derived other income of $981,000 through write-backs of amounts previously accrued in respect of these obligations.

Selected statement of operations information




Operational update
In the lead-up to the winter sports calendar, the Group concentrated efforts in upgrading the Oracle Database and network infrastructure. This planning has maintained a more stable platform throughout the season with fewer system outages. In addition, on-line security risks through Denial of Service Attacks that were prevalent throughout the season have predominately been mitigated through the implementation of new filtering hardware and Internet traffic routing. Further security measures are being reviewed and implemented across the system with the key result to bring system outages to an absolute minimum.

During February 2004, the Group closed its transaction processing and customer service divisions. This decision formed an integral part of the overall business review that commenced in April 2003. The closure of these divisions allows the Group to concentrate on its core software development business while shedding divisions that we cannot efficiently administer.

In keeping with the Group’s commitment to deliver an enhanced product suite, a new concept in on-line gaming called Virtual Games was released to our licensees in the fourth quarter of 2003. Performance of these games has met management’s expectations and provides an enhanced dimension to the Group’s product suite.

The Group’s expanded horseracing product is in the final stages of testing with licensees and is expected to be released in April 2004. In addition, we plan to continue developing the horseracing product thus giving our licensees the ability to better manage their risk and enable improved yield on this product.

Multi-player poker remains a significant priority of the Group. Further stages of development have commenced under a partnership with a third-party supplier. The multi-player poker product is expected to add a significant revenue stream to our licensee’s product suite and we expect to have this available in the third quarter of 2004.

Over the coming twelve months, we intend to invest further in our software platform to enable improved functionality. Together with a new development process, this is expected to deliver better quality products with a faster delivery timetable.

Daniel Moran, World Gaming’s CEO commented:

"The Group has undergone a number of changes in the year including implementation of a new executive Board early in the year, restructuring of certain aspects of the business and closure of those areas that the Group could not effectively maintain or were inconsistent with our core software development business. This continued into the first quarter of 2004. Many of these changes have streamlined the business and enabled it to turnaround and produce the results that we see today. “

“The Board’s resolve remains that of growing the business through enhanced products and infrastructure as we continue to act in a culture of heightened fiscal responsibility. The benefits of this strategy are beginning to show as the Group’s financial position begins to strengthen."

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WORLD GAMING plc ANNOUNCES RESTRUCTURING OF ITS RELATIONSHIP WITH SPORTINGBET plc
LONDON, UK, August 9, 2004 - World Gaming plc (OTC BB: WGMGY) and its affiliates, a UK-based Internet-gaming software and e-business services group of companies ("World Gaming") is pleased to announce the restructuring of its relationship with its major customer Sportingbet plc and its affiliates (“Sportingbet”).

Highlights
World Gaming to enter into an agreement with Sportingbet to transfer a 50% interest in the World Gaming software for the following consideration:
- U.S. $10 million cash under staged payments;
- Additional consideration of U.S. $3.3 million as value for:
Cancellation of all economic and voting rights attached to Sportingbet’s existing 29.5% holding in World Gaming;
Forgiveness of the convertible loan note owed to Sportingbet with a face value of U.S. $900,000.
Future development of the software to be funded by Sportingbet in an amount equal to at least $4.5 million over 4 years, in return for a perpetual royalty free licence to its use within the Sportingbet group.
Development Plan to improve the software for World Gaming licensees and Sportingbet to be agreed by both parties.
World Gaming to have full rights to full use of the software including enhancements for the duration of the partnership agreement plus the ability to continue sub-licensing the software to third parties.
World Gaming to enter into an exclusive hosting agreement for Sportingbet’s U.S. facing database on a cost-plus basis.
World Gaming to acquire new marketing rights over Sportingbet’s multi-lingual and multi-currency European software to market to existing and new licensees of World Gaming throughout Europe.
World Gaming to seek new licensees and explore other business development objectives.
Commenting on the transaction, Daniel Moran, Chief Executive of World Gaming said:

"We are pleased that we have now successfully resolved this issue with Sportingbet allowing for continued growth in the World Gaming software and infrastructure. The restructured relationship not only stabilizes World Gaming's future but will allow us to move forward and expand into new markets as well as open new investment opportunities that previously were not possible.”

Nigel Payne, Chief Executive of Sportingbet said:

“We are pleased to have agreed new arrangements with World Gaming which will give Sportingbet greater control over the software platform for its U.S. facing business and, importantly, over the future development of that software. Furthermore, these arrangements will also reduce our costs significantly going forward.
We are also pleased that these arrangements will allow World Gaming to emerge a stronger, more profitable business independent of Sportingbet’s revenue streams.”

INTRODUCTION
World Gaming is incorporated in England and Wales and carries on business as an Internet gaming software and related services provider.

World Gaming licenses Internet gaming software to third party licensees enabling their customers to play casino games, place sports and horse wagers and enjoy other gaming services over the Internet (the “Gaming Software”). World Gaming earns royalties on the revenue licensees generate from the use of the Gaming Software.

The Gaming Software is owned by a Starnet Systems International Inc. (“SSII”) a subsidiary of World Gaming, which licenses the Gaming Software to third parties. SSII is incorporated and carries on business in Antigua. SSII also carries out all hosting activities on behalf of its licensees. SSII owns equipment and maintains systems in Antigua that host all data that is processed on the Gaming Software in accordance with its licensees gaming licenses.

The Gaming Software was developed, and continues to be further developed, by Inphinity Interactive Inc. (“Inphinity”), a subsidiary of World Gaming, for the benefit of SSII. Inphinity is incorporated and carries on business in British Columbia, Canada. Inphinity has employees and owns certain computer and related equipment that are required for the purpose of developing the software (the “Ancillary Assets”).

World Gaming's largest licensee is Sportingbet. Sportingbet is incorporated in England. In the financial year 1 January to 31 December 2003, approximately 80% of World Gaming’s royalty revenues were generated from Sportingbet. Sportingbet currently owns 29.5% of the outstanding equity of World Gaming (“SB Shares”). Sportingbet, through a wholly owned subsidiary, also holds a convertible loan for U.S. $900,000 under an instrument dated 4 April 2003 (the “Convertible Loan”). Pursuant to this Convertible Loan, Sportingbet has an option to purchase a further 14% equity interest in World Gaming at twelve cents per ordinary share. Upon conversion of the Convertible Loan, Sportingbet would own approximately 39.2% of the equity in World Gaming.

Upon 45 days notice prior to the annual contract anniversary each March, Sportingbet may terminate the existing licence agreement with SSII. While no actual termination notice has been given and Sportingbet has agreed in principle to an extension of the licence agreement to March 2006, Sportingbet has indicated that it will not be renewing its licence agreement with SSII thereafter. Sportingbet has provided the Board of World Gaming with the following reasons as to why it would not renew the licence:

(a) Sportingbet’s own in-house platform could service its business on a more economic basis;

(B) Sportingbet requires a greater degree of security over the software being used;

© Sportingbet requires a greater degree of influence over the future development of the software.

Furthermore, since the existing licence agreement does not require Sportingbet to use World Gaming’s software for all of Sportingbet’s U.S. facing markets, there can be no guarantee that, even if Sportingbet did renew the licence World Gaming would generate sufficient revenues to continue as a going concern. If Sportingbet did not renew the licence, the loss of revenue would have serious cash flow implications for World Gaming and would also threaten its ability to continue as a going concern.

In April 2004, Sportingbet advised World Gaming and announced publicly that it was reviewing its options with respect to continuing to use World Gaming's Gaming Software on any or all of its brands. In addition, Sportingbet indicated that it might begin to sell its shares in World Gaming. The Board of Directors of World Gaming explored several alternative arrangements before proceeding with the transaction to be proposed to shareholders for approval, as set out below.

SUMMARY OF PROPOSED TRANSACTION
World Gaming has signed an agreement with Sportingbet which is conditional upon approval by a majority of World Gaming shareholders voting at the Annual General Meeting (“AGM”). The framework and other main proposals of the transaction comprise the following:

A. Joint Partnership for Gaming Software

1. A wholly owned Sportingbet group company (“IOE”) will purchase a 50% interest in the Gaming Software from SSII. Both SSII and IOE will each contribute their 50% ownership of the Gaming Software to a newly formed limited liability partnership that will be incorporated in the Cayman Islands (the “Joint Partnership”). World Gaming and Sportingbet (through their respective affiliates) will be equal partners in the Joint Partnership and accordingly will jointly own the Gaming Software. World Gaming will be required to give warranties on the ownership and sufficiency of the Gaming Software.

2. The Joint Partnership will grant each of World Gaming and Sportingbet a perpetual royalty-free master licence to use the Gaming Software. World Gaming will have the right to continue to sub-license the Gaming Software to any third party whatsoever. Sportingbet may only use the Gaming Software royalty free for its existing licensees and for the benefit of members of its group. World Gaming and Sportingbet will only make payments in the following situations:

(i) Sportingbet will pay 5% of licensee’s net win to World Gaming for any new white-label marketing partner taken on after completion of this transaction (where “net win” is the difference between amount wagered (bet placed) by a customer of a licensee and the amount back to (won by) that customer);

(ii) World Gaming will pay 5% of licensee’s net win to Sportingbet if it acquires a controlling interest in a competitor of Sportingbet or enters into a transaction with a competitor which requires World Gaming or the competitor to consolidate any or all of each others revenues;

(iii) World Gaming will pay 5% of relevant websites’ net win if it owns and operates its own gaming website;

(iv) Where such a payment is payable, these will continue for the duration of the Joint Partnership and for a period of three years from the date of its termination.

B. Newly incorporated company for development function

3. Inphinity will move its development, maintenance and second level support functions, including all of the Ancillary Assets to a newly formed limited liability company that will be incorporated in British Columbia, Canada (“NewCan”). NewCan, which will be owned by Sportingbet, will offer to take on all employees of Inphinity who presently carry out the above functions.

4. NewCan will report directly to the Joint Partnership. The Joint Partnership will be equally controlled by World Gaming and Sportingbet.

5. NewCan’s purpose will be to continue developing and maintaining the Gaming Software in accordance with a plan agreed between World Gaming and Sportingbet (the “Development Plan”). The Development Plan will be agreed at the commencement of the transaction and will be subject to review by World Gaming and Sportingbet on a quarterly basis. Sportingbet and World Gaming shall directly share in the objectives of the Development Plan on a 70/30 basis, respectively. World Gaming may purchase additional development time should the need arise. Given the nature of each business, it is expected that such objectives will often be entirely congruent.

6. Sportingbet has agreed to fully fund the operating costs of NewCan. Sportingbet has committed to spend at least U.S. $4.5 million per year on the operational and development costs of NewCan in the first 3 years and a minimum of U.S. $2.5 million in the fourth year. In addition to this, NewCan will also provide second level support services to World Gaming in the ordinary course of its business. Sportingbet has indicated that it may, although it is not required to, invest additional sums into development over and above this minimum commitment.

7. In accordance with its obligations described in the preceding paragraph, Sportingbet will have day-to-day control over NewCan. Such control will be predominately carried out through the jointly elected Chief Technology Officer. NewCan will enter into a Development Services Agreement to which World Gaming will be a party to ensure that NewCan operates according to the Development Plan.

C. Consideration and ancillary arrangements

8. The consideration for the Gaming Software (the “Sale Consideration”) is in total U.S. $13.3 million value which will comprise:

(a) U.S. $10 million of which:

(i) U.S. $3 million cash is payable on completion of the transaction;
(ii) at least U.S. $3 million cash on or before 1 March 2005; and
(iii) U.S. $4 million cash to be paid in installments on or before 1 November 2005;

(B) Additional consideration of U.S. $3.3 million as value for:

(i) the 13.6 million shares in World Gaming owned by Sportingbet (29.5% of the World Gaming Equity) having restrictions attached to them by ordinary resolution of the Company with the effect that such shares will have no dividend, voting, participation or other rights; and
(ii) the cancellation of the convertible loan note and the options thereunder and to otherwise release World Gaming from all obligations under this instrument.

9. The full payment of the $10 million will be secured by a partnership pledge over Sportingbet’s partnership interest in the Joint Partnership. This arrangement is to permit World Gaming to acquire exclusive access to the Gaming Software and development thereof in the event of a payment default by Sportingbet.

10. As part of the transaction NewCan will acquire the Ancillary Assets and assume various employer obligations related to the Inphinity employees.

11. The parties will also enter into the following ancillary arrangements:

(a) Information Technology Services

World Gaming will provide certain U.S. facing hosting services to Sportingbet on an exclusive basis for the life of the proposed transaction. Such services will be charged on the basis of actual cost plus a 10% margin.

(B) Sportingbet Ancillary Services

Sportingbet or its affiliates will continue to provide certain customer and transaction processing services to World Gaming’s existing and future licensees on agreed terms that do not materially differ from those already offered.

© European Marketing

Sportingbet will provide World Gaming, through a joint marketing arrangement, with access to Sportingbet’s in-house technology to allow World Gaming to market a European Gaming solution for the benefit of existing and future licensees.

The combination of services described in the above ancillary arrangements above effectively enables existing licensees and future licensees to access a turn-key gaming operation from World Gaming should they require such services.

D. Termination of the Joint Partnership and NewCan

12. Sportingbet may not terminate the Joint Partnership and NewCan for the first 3 years from completion of the transaction. Thereafter, Sportingbet may terminate upon 12 months notice to World Gaming. However, Sportingbet may terminate at any time if certain events of default occur, such as material breach by World Gaming or a material change in control of World Gaming.

13. World Gaming may terminate the Joint Partnership and the arrangements with NewCan at any time upon 3 months notice to Sportingbet, or upon the occurrence of certain events of default.

14. Upon termination:

(a) Sportingbet is required to make a further payment to World Gaming of U.S. $3 million (if World Gaming voluntarily terminates and then sells the Gaming Software within 2 years, this additional payment to be reduced by the consideration received by World Gaming, up to a maximum of U.S. $3 million);

(B) The Gaming Software (as updated and improved) will be jointly owned by Sportingbet and World Gaming (or their respective affiliates), and both parties will have an unrestricted right to use, sub-licence and assign their interest in the software. Neither party will have the rights to any further improvements or developments made by the other party.


RECOMMMENDATION TO SHAREHOLDERS

At the Annual General Meeting (“AGM”) shareholders will be asked to vote on the transaction as discussed in this document.

The Board of Directors of World Gaming (or the “Company”) will unanimously recommend this transaction to World Gaming shareholders. In forming this recommendation, the board considered the likely alternatives should Sportingbet commence removing any or all of its brands from the World Gaming platform, the Internet gaming market as a whole and the Company’s position in that market and what the most valuable course of action would be for Shareholders. In addition, the Board has received a written opinion dated 6 August 2004, from Houlihan Lokey Howard & Zukin Financial Advisors Inc. (“HLHZ”) that, as of the date of the opinion, the transaction, taken as a whole, is fair, from a financial point of view, to the existing shareholders of World Gaming other than Sportingbet (subject to final accounting and legal confirmation).

The key benefits of the transaction for World Gaming include:
i. Significantly lower cost base than that of our competitors;
ii. Cash injection of U.S. $10m over 18 months;
iii. Sportingbet relinquishes controlling interest in World Gaming;
iv. Cancellation of remaining World Gaming debt;
v. Expected continuation of profitability;
vi. Guaranteed improved products and stability for existing World Gaming licensees;
vii. Addition of European software platform to World Gaming’s product suite;
viii. Continuation of market leading gaming operator utilizing the World Gaming software platform.

The entire existing holding of Sportingbet in World Gaming (29.5% of World Gaming equity) will have restrictions attached to them by ordinary resolution of the Company with the effect that will have no dividend, voting, participation or other rights. These shares will also be subject to an irrevocable right of World Gaming to buy-back the shares at a later date. This method has been adopted at this time instead of a share buy-back as World Gaming is unable to buy back shares under the UK Companies Act 1985 as it has insufficient retained earnings.

STRATEGIC OVERVIEW OF WORLD GAMING

The benefits described above have had a significant influence over World Gaming’s future strategic direction. World Gaming’s revised business plan will focus on four key strategies:

1. Actively engage in marketing to seek new licensees for its existing software platform together with exploration of the European market.
2. Deliver a robust, industry leading software platform to existing and future licensees with the key advantages of:
i. Significantly lower cost base than our competitors;
ii. Access to both leading US and European software solutions with access to all development and enhancements utilized in the Sportingbet Group in addition to the flexibility to add other unique enhancements as required;
iii. Access to market leading customer service and transaction processing should licensees require these services.
3. Actively participate in management of the Joint Partnership ensuring that development objectives meet with its requirements.
4. Seek new markets for investment and potential listing opportunities to maximize shareholder value.

The Board of World Gaming is actively considering certain other business opportunities which are synergistic with the licensing business described above.

World Gaming has engaged industry consultants to provide analysis on the Internet gaming industry examining where opportunities exist. In this regard World Gaming plans to hire a sales and marketing team to exploit these opportunities.

A full update of World Gaming’s strategy and the measures under which it will review the successful implementation of such strategy are expected to be provided to shareholders at World Gaming’s AGM.

ANNUAL GENERAL MEETING

The final date for the AGM will be announced to Shareholders by early September, 2004. Shareholders will receive relevant circulars, proxies and other information in the coming weeks.

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WORLD GAMING ANNOUNCES AGM DATE
London, UK, September 8, 2004 - World Gaming plc (OTC BB: WGMGY), will hold its 2004 Annual General Meeting on Tuesday, October 12, 2004 at 11:00 a.m. at the offices of Reed Smith, 5 Montague Close, London, United Kingdom.

The matters to be considered and voted on at the meeting include:

the election of directors subject to rotation;
selection of the company’s auditors;
tabling the financial statements for 2003;
matters relating to the recent transaction with Sportingbet.
All explanatory and voting materials together with the financial statements for the year ended 31 December 2003 and the Chairman’s letter to shareholders will be mailed to shareholders in the week beginning September 13, 2004.

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World Gaming plc Annual General Meeting Statement
London, UK, October 13, 2004 - World Gaming plc (OTC BB: WGMGY), ), held its 2004 Annual General Meeting on Tuesday, October 12, 2004 at 11:00 a.m. at the offices of Reed Smith, 5 Montague Close, London, UK.

The Board of World Gaming announces that all resolutions proposed at the Company's Annual General Meeting held on October 12, 2004 were approved by the shareholders. These resolutions included those relating to the transaction with Sportingbet plc and its affiliates upon which Sportingbet abstained from voting. All resolutions passed by an overwhelming majority.

The Board of Directors presented to shareholders with respect to its financial results, business plan moving forward and its implementation. The Board is focusing on three key areas:

Software licensing specifically targeting existing operators as well
as providing turnkey solutions for non gaming businesses with
substantial databases looking for new sources of revenues. Licensing
will involve both US and European facing platforms;
Acquisition of one or more gaming related businesses;
Entry into specific niche markets for gaming and gaming related
services.
The implementation of these plans are still at early stages and are intended to broaden the Company's revenue base while maintaining a scalable cost structure. The Board will update shareholders after further progress in these areas has been made. Achieving critical mass in a combination of these areas is expected to provide the company with opportunity to move to new markets such as the Alternative Investment Market of the London Stock Exchange.

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WORLD GAMING plc REPORTS THIRD QUARTER RESULTS
LONDON, UK, November 9, 2004 - World Gaming plc (OTC BB: WGMGY), a UK-based Internet-gaming software and e-business services group of companies (the “Company”), is pleased to report financial results for the three and nine months ended September 30, 2004.

Highlights
Net profit for the quarter of $1,146,000 vs. loss of $181,000 for the same period last year.
System-wide wagering volume up 97% from the same quarter last year.
Revenues in the quarter up 43% from the same period last year.
Operating expenses in the quarter down 9% from the same period last year.
Completion of transaction with Sportingbet plc.
Fiscal results
Total revenues for the quarter ended September 30, 2004 were $4,038,000 compared to $2,818,000 for the same period last year. For the nine months ended September 30, 2004 total revenues were $13,550,000 compared to $10,341,000 for the same period last year. This 43% increase in revenues in the quarter was driven primarily by increased licensee wagering volumes of 97% and higher net win achieved by our licensees when compared to the same period last year.

Net profit for the quarter ended September 30, 2004 was $1,146,000 or 3 cents earnings per share compared to a net loss of $181,000 or a loss of 1 cent per share for the corresponding period last year. For the nine months ended September 30, 2004, earnings per share rose to 11 cents per share from net profit of $4,805,000 up from 1 cent per share for the same nine month period last year from net profit of $24,000. The increase in profitability is the result of management’s efforts to grow licensees wagering volumes through greater product offerings and a more stable infrastructure while leveraging profitability through maintaining a stable and scalable cost structure. (In addition, please refer Recent Developments below).

In February 2004, the Company closed the transaction processing division together with Customer Support. Affected licensees were successfully transferred to an industry leading solution. There are no revenues or direct costs from these divisions in the quarter to September 30, 2004. Included in revenues for the corresponding quarter of 2003 are revenues of $423,000 from transaction fee revenue.

The gross margin for the quarter was 94% as compared to 88% for the same period last year. The increase represents a more profitable revenue mix due to the closure of the transaction processing division in February 2004. During its operation, direct costs in all quarters for the transaction processing division exceeded transaction fee processing revenue.

Operating expenses decreased 9% to $2,692,000 during the third quarter of 2004 compared to $2,948,000 for the same period last year. The primary contributors to this reduction were:

Depreciation charges declined $174 or 32% when compared to the same period last year;

A 3% reduction in other corporate overheads or a reduction of $82,000, when compared to the same period last year.

Selected statement of operations information (unaudited, in thousands)




Operational update
In the third quarter the Company completed a major upgrade to its hosting facilities in Antigua. The upgrade involved moving to an Oracle 10g database platform in addition to replacement and expansion of disk storage sub-systems. It is expected that this platform together with other new hardware infrastructure will produce a more robust operating system with greater scalability.

Wagering volumes continue to grow over the entire product suite. During the quarter ended September 30, 2004, the Company experienced a 97% increase in wagering volumes and for the nine months ended September 30, 2004 the growth was 79%. Growth in wagering volume from licensees other than Sportingbet for the quarter ended and year to date September 30, 2004 were 111% and 67% respectively. The systems’ proven ability to handle such volumes is a key benefit of the World Gaming platform.

Much of the Board’s time during the third quarter of 2004 was involved in negotiating an agreement with Sportingbet plc as discussed below in respect of their licensing arrangement with the Company. The Board is pleased with the outcome for the Company and its Shareholders in that it has provided the Company with a significant cash injection while the Company still retains ownership in the software to continue in its licensing business. Accordingly, the Company has retained its continuing profitable business from its licensees other than Sportingbet.

During the Company’s 2004 Annual General Meeting in October of 2004, the Board outlined three strategies that it expects to execute over the coming twelve months:

Software licensing specifically to operators or providing turnkey solutions for businesses not necessarily involved in gaming with a substantial database considering entering the gaming market. Licensing will involve both US and European facing platforms;
Operations into specific niche markets for gaming and gaming related services;
Acquisition of gaming related businesses including the possibility of gaming operators or other e-commerce related business.
The Board has had preliminary discussions with investment banks and professional advisors with respect to beginning trading on the Alternative Investment Market (AIM) of the London Stock Exchange. The Board believes that the key benefit of trading the Company’s shares on AIM would be demonstrated through execution of its strategy to potentially acquire operators or other related businesses within the industry. An AIM listing is expected to give the Company the opportunity to raise capital through institutional investment in the Company’s shares together with the ability to use shares traded on the AIM as currency for its acquisitive strategy. It is expected that existing ADR holders will continue to trade their shares on the OTC.BB market, however they would be invited to transfer their shares to the AIM market should they wish to so.

Recent Developments
The Company previously disclosed that during the first quarter of 2004, the Company agreed in principle with Sportingbet plc to a two-year extension of its existing software license agreement. During the year ended December 31, 2003, Sportingbet represented approximately 80% of the Company’s royalty revenues and owned a substantial equity interest in the Company. As previously disclosed, Sportingbet had indicated that it wished to explore alternative structures to its existing relationship with the Company.

In August 2004, the Company disclosed full details of the restructured relationship that its Board of Directors had agreed upon with Sportingbet. In September 2004, the Company sent a circular to its Shareholders describing the terms of the transaction, made available relevant contracts and requested that Shareholders vote on the matter at its 2004 Annual General Meeting. At the Company’s Annual General Meeting held on October 12, 2004, Shareholders voted in favour of all resolutions in respect of the transaction with Sportingbet. Sportingbet abstained from exercising any of its voting rights.

The transaction with Sportingbet was effective October 1, 2004 and will materially affect the revenues and expenses of the Company. The key elements of the transaction are as follows:

The Company has entered into an agreement with Sportingbet to transfer a 50% interest in the Company’s software to a Joint Venture with Sportingbet for the following consideration:

U.S. $10 million cash under staged payments;
Additional consideration of U.S. $3.3 million as value for:
Cancellation of all economic and voting rights attached to Sportingbet’s existing 29.5% holding in World Gaming;
Forgiveness of the convertible loan note owed to Sportingbet with a face value of U.S. $900,000.
Future development of the software is to be funded by Sportingbet in an amount equal to at least $4.5 million over 4 years, in return for a perpetual royalty free licence to its use within the Sportingbet group.
A Development Plan to improve the software for the Company’s licensees and Sportingbet is to be agreed by both parties.
The Company will have full rights to full use of the software including enhancements for the duration of the partnership agreement plus the ability to continue sub-licensing the software to third parties.
The Company has entered into an exclusive hosting agreement for Sportingbet’s U.S. facing database on a cost-plus basis.
The Company has acquired marketing rights over Sportingbet’s multi-lingual and multi-currency European software to market to existing and new licensees of World Gaming throughout Europe.
As a result of these transactions, the Company will no longer receive royalty fees from Sportingbet, it will no longer have the costs associated with the entire development group and it will receive hosting revenues equal to Sportingbet’s usage percentage of the Company’s hosting facilities with a 10% mark-up (estimated to be $2.5 million in the twelve months following the date of the transaction). Sportingbet currently accounts for approximately 80% of the Company’s hosting facility usage. As compensation for the gaming software, the Company will receive $10 million of which $3m was received on October 12, 2004, and $3m is to be received by March 31, 2005 and $4m is to be received by November 2005. In addition, Sportingbet has forgiven the Company’s obligations under its $900 convertible loan note due to Sportingbet. At the date of the transaction, Sportingbet held 13,506,204 ordinary shares of the Company, equal to 29.5% of the Company’s outstanding equity. As part of the transaction, Sportingbet will cancel all economic and voting rights attached to these shares and the Company will have the exclusive option to purchase such shares for an aggregate $1 when at such time it has retained earnings to do so. As at September 30, 2004, although reduced from 2003, the accumulated deficit stands at $18,906.

[Cabo]

WORLD GAMING plc ANNOUNCES APPOINTMENT OF SALES AND MARKETING DIRECTOR

LONDON, UK, December 6, 2004 - World Gaming plc (OTC BB: WGMGY), a UK-based Internet-gaming software and e-business services group of companies (the “Company”), is pleased to announce the appointment of Jon Moss as Director of Sales and Marketing.

In keeping with the Board’s stated strategies we are delighted to announce the appointment of Jon Moss to reinvigorate sales and marketing efforts of the Company’s leading gaming software. Jon will commence as Director of Sales and Marketing on January 1, 2005.

Immediately prior to his appointment, Jon held the position of Business Development Director at WagerLogic Limited, the licensing and services subsidiary of CryptoLogic Inc., one of the industry's leading e-gaming software providers. Jon was successful in attracting high quality European brand-name clients to CryptoLogic's casino and poker solutions including Betfair, Littlewoods Gaming, The Ritz Club of London and ukbetting plc. Jon has also played a key role in industry lobbying efforts related to the forthcoming UK Gambling Bill and is an experienced speaker at international e-gaming conferences. Prior to joining WagerLogic, Jon was a director of a leading industry consulting group and was responsible for bringing the world's first regulated internet casino, Lasseters.com, to market in 1999. Jon’s international business experience includes successful careers with Unisys and Motorola, heading computer and telecommunications business units in Australia and the United States.

It is the Board’s intention to actively participate in industry trade shows and the Company has begun to reserve positions at such leading events. These will be updated on the Company’s Events Calendar at www.worldgaming.com.

Commenting on the appointment, Daniel Moran, CEO said:

“Jon’s proven track record in the e-gaming industry fundamentally strengthens the Company’s strategic direction to attract new high quality licensees and white label partners. In addition, Jon brings a wealth of experience to our management team. We are delighted to have Jon onboard.”