PartyGaming enjoys strong start to Q4 - 15th October 2009

Online gambling firm PartyGaming (PRTY.L) said on Thursday it was confident about its full-year prospects, having made a strong start to the fourth quarter.

PartyGaming said its total revenue rose 11 percent to $112.7 million (69 million pounds) in the third quarter from the previous quarter, despite it normally being a weak period for the industry as players take their summer holidays.

Casino revenue climbed 2 percent to $49.2 million.

In Poker, where the company has faced increasing competition from unregulated United States operators such as PokerStars and Full Tilt, revenue fell 8 percent to $45.1 million.

However, Chief Executive Jim Ryan said the company had attracted new poker players through the launch of a number of initiatives including a loyalty programme and "VIP" offer.

"Poker remains challenging from a competitive standpoint, but we are encouraged by the increased player traffic during September and into October," he said.

Shares in PartyGaming, which have outperformed the FTSE All Share Leisure & Travel Index <.FTASX5750> by 15 percent since the start of the year, had fallen 0.4 percent to 281.5 pence at 9:00 a.m. British time.

KBC Peel Hunt analyst Nick Batram reiterated his 'hold' recommendation and 257 pence price target on the stock.

"The group's investment in poker is beginning to deliver some forward momentum, in player numbers and gross revenues at least. However, at this stage we continue to believe that the rating is up with events," he said.

The consensus for full-year pretax profit stands at $102 million, according to a Thomson Reuters I/B/E/S poll of ten analysts.

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