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888 Continues to Shine

With poker results that continue to defy expectations, 888 Holdings reported its eighth successive quarter of revenue growth, the operator announced in its report for the three months ended September 30.

The company’s poker operations increased 21% to $22 million, compared to $18 million in the same period last year, while the number of active players jumped 14% to 349,000.

888 rolled out a new poker client in November 2011. A fresh look, and a boost in marketing, is paying off. In the first nine months of 2012, poker revenue has spiked 50% to $63 million.

Poker revenue in the last quarter, per customer, climbed 6% to $63. The company now has 12.5 million registered poker, casino and sports betting accounts, a 24% increase over the same period last year.

“Our poker product is attractive to the casual player, and that’s our market…we actually encourage the fish to come into our pool and we dissuade sharks, or professional poker players,” said 888 chief executive Brian Mattingley.

Casino operations were up 2% to $38 million compared to the third quarter of 2011, though revenues from B2B arm Dragonfish fell by the same amount year-over-year. Overall group revenues reached $92 million, a 7% increase.

Mattingley also highlighted that operations in Spain are “outperforming our expectations.” Poker revenues have double in the country since the launch of the operator’s .es domain in June.  

“Poker in Spain has assisted significantly in the growth of our poker business. Since we entered, we have become second in the market with 20 percent share,” Mattingley noted.

The Spanish site is No. 2 in traffic behind PokerStar2, and will likely be profitable by next year.

“This year, 888 Spanish business will probably break even and next year should be profitable versus our original expectation of losses as they built up the brand in the market,” wrote Peel Hunt’s Nick Batram.

With average fourth-quarter daily revenues up 7%, management expects earnings for the full year to be “significantly ahead of current market expectations.”

888 Holdings shares were up nearly 13% today in London trading.

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