CHIEF EXECUTIVE’S STATEMENT
The successful implementation of our strategy has produced record results for the 2007 ¢nancial year.
The Group has taken a number of steps to improve the pro¢tability of its core German business including
tighter control of overheads and expenditure. The distribution of all direct mail to recruit customers was
stopped in May 2007, and marketing efforts were concentrated on af¢liate marketing and search engine
optimisation with customer recruitment remaining at historic levels.
In June 2007, the Group renegotiated its casino/poker operating contract with Boss Media on more
favourable commercial terms. In order to remain competitive, Gaming VC believes it is important to
utilise other software providers. New brands utilising £ash casino and live dealer casino products will be
launched during 2008 and a new poker brand www.pokerkings.com was launched in December 2007.
In September 2007, Gaming VC launched a sportsbook licenced in Malta (www.betaland.com) and in
the ¢rst quarter of 2008, has secured an additional Italian sportsbook licence (www.betpro.it). The
Maltese sportsbook launch has exceeded our expectations and represents a signi¢cant step for
Gaming VC in developing business outside of Germany. The new business has continued to grow during
2008 and Italy will continue to be a key strategic market for the Group in the ¢nancial year ahead.
Further sportsbook sites will be launched under the ‘Betaland’ brand in 2008 to assist with diversi¢cation.
To further extend the Group’s product range, Gaming VC launched a bingo site, www.winzingo.es, in
the ¢rst quarter of 2008, using the proven software from Parlay. This site will initially be focused on the
Spanish female market and rolled out across other European territories in due course.
Consistent with the change in marketing strategy, the Group replaced direct marketers with experienced
executives from the online gaming industry including af¢liate marketing. In addition, an experienced
Customer Relationship Management (CRM) teams allow us to concentrate on the retention of existing
casino customers. The CRM expertise that was recruited in 2007 together with further recruits will be
employed to set up a new CRM centre during the second quarter of 2008 to handle all aspects of
customer service, currently provided by Boss Media. By bringing all areas of customer contact in-house
Gaming VC will have complete control over all areas of the customer interface. This should signi¢cantly
enhance retention and maximise the lifetime value of customers.
Group Financial Performance
Net Revenue Gross Pro¢t
All C’000 2007 2006 2007 2006
Casino 38,164 38,365 28,685 28,377
Poker 3,420 2,208 2,409 1,038
Sports Betting 1,123 ^ 1,075 ^
Total 42,707 40,573 32,169 29,415
In 2007, the total gross wagers placed were C1.8 billion (2006: C1.6 billion) and net revenues were
C42.7 million (2006: C40.6 million). A signi¢cant proportion of the revenue growth is attributable to the
commencement of sports betting during the year, which accounted for C1.1 million of the increase. The
gross pro¢t for the ¢nancial year ended 31 December 2007 was C32.2 million (2006: C29.4 million).
C1.1 million of the increased gross pro¢t was generated from the sportsbook activity started in 2007.
Casino operating activities in 2007 remained at a similar level and margin to 2006 and poker net
revenues increased by 55% year-on-year. In both 2007 and the prior year less than 1% of the gross
margin was earned from customers residing outside the European Union and Gaming VC have never
transacted any wagering activity by customers in the US.