Shares in PartyGaming surged yesterday after the world's biggest internet poker operator gave a bullish trading update following the introduction of blackjack on its site. Its stock jumped 19.25p to close up nearly 17 per cent at 136.25p.
City analysts upgraded their forecasts after PartyGaming said it expected to beat market expectations for this year.
Blackjack got off to a flying start when it was launched on 8 October, and the firm attracted a record 77,000 new players in November. About 40 per cent of its poker punters play blackjack. While this has somewhat reduced takings from poker, overall revenues were up "substantially", the company said.
Richard Segal, PartyGaming's chief executive, said: "This has totally transformed our casino business and has made it a very significant business overnight."
Daily poker revenues rose 14 per cent to $2.67m (£1.52m) in October and November compared with the average for the previous quarter. The group conceded that revenues had benefited from the novelty factor and would slide somewhat from current levels, but hopes to repeat the success it has had with blackjack by launching two newgames next year. It will also introduce a "shared purse", allowing customers to play different games from the same account. Analysts at Morgan Stanley upgraded their 2005 earnings forecast before interest, tax, depreciation and amortisation to $560m on revenues of $960m, citing the company's "staggering" performance.
The poker giant floated at 116p a share in June amid a blaze of publicity, raising a little less than £1bn for its owners. But its shares dived in September when PartyGaming warned that the internet poker craze had started to wane.
The group has fought back, and in October moved to ringfence its poker players from those of its partners, known as "skins", which directed players to its site in return for a commission. PartyGaming acquired two of these skins a month later, while another skin, Coral Eurobet, left the PartyGaming platform.
That left Empire Online, the fourth skin, vulnerable to a takeover approach from PartyGaming, though talks have been terminated. This week Empire initiated legal proceedings against PartyGaming for breach of contract.Reuse content