888 Experiences Shares Slump Following Profit Warning
This was published 30-05-2010The shares of 888 Holdings, an online poker and gambling operator slumped with 18% on Friday after 888 Holdings management warned that the effect of the upcoming Football World Cup , and a large drop in the amount of online poker players, leaves its profit margin a lot lower than what was expected.
Most of 888 Holding’s trading has been rather week, but unfortunately the group’s internet poker tables had the biggest knock, with the average amount of online poker players dropping 18% per day between the months of January & May.
The online poker group stated it believes that the decline in poker activity forms part of an industry-wide online casino trend. 888 Holdings shares slumped with fifteen percent on the London’s Stock Exchange, and fell 18% at its lowest point during the day.
One of their major poker rivals, Rival PartyGaming’s shares dropped with 5.3%, while shares of the U.K. bookmakers Ladbrokes and William Hill, which are mostly concerned with sports betting, both did better.
While bookmakers are set to benefit from the FIFA World Cup, 888 said trading will be difficult for companies that offer casino games and other gambling online.
On top of all of this, the company has also been experiencing troubles because the Euro and Sterling is weaker against the dollar and because there are new French gambling regulations. The regulations require the company to move to a new regulated online poker platform.
A spokesperson for 888 Holdings said in a press release:
“The board has revised its outlook for the remainder of the year and now expects profit to be significantly lower than previous market expectations. A number of steps, including cost cutting, have already been implemented and the board remains confident about the future strategy and prospects.”
They spokesperson added that despite these setbacks, the online poker company is still making a profit.
