19.01.2006
WORLD GAMING PLC TRADING STATEMENT
London, UK, Jan 19, 2006 - (OTC BB: WGMGY, LSE: WGP), The Company is pleased to issue an update in respect of trading in the twelve months ended 31 December 2005 which included three months of trading from the SPORTSBETTING.COM group acquisition and an update on the consideration payable relating to that acquisition.
Subsequent to the Company's acquisition of the SPORTSBETTING.COM group effective 1 October 2005, the business has maintained strong performance in respect of customer sign-ups, deposits, customer activity levels and wagering volumes, all of which have exceeded management's expectations.
Similarly, the Company's software licensing business has continued to experience strong growth in licensee wagering volume throughout the fourth quarter of 2005.
It has been widely publicised that sports betting win margins, particularly with respect to American NFL results in the fourth quarter have been well below industry trends and well below margins that the SPORTSBETTING.COM group has experienced in comparative prior periods.
As previously announced, the terms of the acquisition for the SPORTSBETTING.COM group provide that should Profit Before Tax ("PBT") of the SPORTSBETTING.COM group fall below $15.0 million for the twelve months ended 31 December 2005, then the total consideration shall be equal to the PBT multiplied by six times. It is expected that PBT for the SPORTSBETTING.Com group, calculated in accordance with the terms of the acquisition agreement will be approximately $13.8 million.
On this basis, consideration payable to the vendors of the SPORTSBETTING.COM group is expected to be reduced from the maximum consideration payable of $96.0 million to approximately $82.8 million, a reduction of approximately $13.2m. The reduction in consideration is therefore expected to be approximately $9.9 million in cash and $3.3 million or approximately 1.5 million in shares. All amounts shall be finalised on conclusion of an independent audit.
This reduction in the number of shares to be issued to the vendors of the SPORTSBETTING.COM group means that earnings per share for the Company for 2006, based on current market expectations, would rise by approximately 3%.
Management expects that operating profit before goodwill amortisation (EBITA) for the Company shall be approximately $6.5 million for the twelve months ended 31 December 2005.
Chief Executive Officer Daniel Moran commented: "We are delighted to be reporting on a highly successful year of change and rapid growth for World Gaming. Our admission to AIM and acquisition of the SPORTSBETTING.COM group, our largest licensee, have put the Company in a very strong trading position.
The Directors are pleased to report that the structure of the transaction for the acquisition of the SPORTSBETTING.COM group has been highly effective in maintaining and growing earnings for shareholders. While a short-term abnormality in American NFL trading margins has produced a lower than anticipated sports margin in the fourth quarter, the anticipated reduction in consideration of over $13 million comfortably mitigates this issue. Strong underlying performance indicators remain and the start of 2006 has seen a return to historic margin levels.
The Directors look to the future with confidence and a commitment to continued development of our business in coming years."
28.02.2006
NOTICE OF RESULTS
London, UK, Feb 28, 2006 - (OTC BB: WGMGY, LSE: WGP), The Board of World Gaming announces that it will be releasing its Final Results for the year ended 31 December 2005, on Wednesday 29 March 2006.
The Company will be holding an analyst briefing at 10:00am on the day of results at the offices of Daniel Stewart, Becket House, 36 Old Jewry, London EC2R 8DD.
Enquiries:
Bishopsgate Communications Limited
Maxine Barnes
Dominic Barretto Tel: 020 7430 1600
The Ordinary Shares have not been and will not be registered under the U.S. Securities Act of 1933 (the "Securities Act") and may not be offered or sold in the United States or to a U.S. person (as such term is defined in Regulations S under the Securities Act) absent registration or an applicable exemption from registration under the Securities Act.
About the World Gaming Group
World Gaming plc is a UK based holding company whose subsidiaries participate in Internet gaming software licensing and operations. The World Gaming Group is an international developer, licensor, and provider of online gaming products, including casino, sportsbook, and pari-mutuel betting.
World Gaming's Ordinary Shares are traded on the London Stock Exchange, Alternative Investment Market ("AIM") under the symbol WGP and the Over The Counter Bulletin Board market in the U.S. under symbol WGMGY.
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