Tipp24 AG: Sales and earnings in Germany collapse - Growth abroad

May 28, 2009 10:01 AM

Tipp24 AG / Quarter Results

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Tipp24 AG: Sales and earnings in Germany collapse - Growth abroad

Basis for German operations largely removed by State Treaty on Gaming

(Hamburg, 28 May 2009) The intensive political and legal discussions
surrounding Germany's gaming market and the respective legal conditions
continued in the first quarter of 2009. Numerous court proceedings have
been suspended until a settlement has been reached at a European level.

Due to the considerable legal restrictions imposed by the German State
Treaty on Gaming and costs in connection with the restructuring of the
company's business fields, EBIT from German operations amounted to EUR
-3,077 (prior year: EUR 3,158) thousand. Revenues of the domestic segment
fell by 92.6 percent to EUR 725 (9,770) thousand in the first three months
of the current fiscal year, as a result of the virtually complete
withdrawal of the company's business base in Germany.

Jens Schumann, Chairman of the Executive Board of Tipp24 AG, states: 'As a
consequence of the regulatory situation, Tipp24 AG ended its brokerage
activities in Germany at the beginning of the year. For Germany's federal
states, this move alone will mean a loss of around EUR 130 million in
annual tax revenues in future. As other market players are equally affected
by the regulations of the State Treaty on Gaming, the annual tax shortfall
will be in the billions.'

Thanks to the much stronger focus placed on expanding international
business, EBIT for the 'Abroad' segment was well above the prior-year
figure at EUR 17,912 (-576) thousand. Revenues generated outside Germany
were up from EUR 1,602 thousand in the prior-year period to EUR 24,876
thousand and dominated total revenues with a share of 98.7%.

Consolidated EBIT of Tipp24 AG and its equity interests grew to EUR 14,635
(2,687) thousand in the first three months of fiscal 2009. The EBIT margin
rose by 34.5 percentage points to 58.1 (23.6) percent. Consolidated net
profit for the period increased to EUR 11,869 (1,876) thousand. Revenues
rose by 121.7 percent to EUR 25,209 (11,373) thousand.

Schumann: 'With its various equity interests, Tipp24 AG is well equipped
for the future. The parent company itself will focus on the expansion of
the Tipp24games business and on identifying and acquiring new business
models in Germany and Europe. Moreover, we will continue to seek the
resumption of our previous business activity as a private broker of state
lottery products in Germany. This will happen as soon as the legal
situation has been settled in our favour by the respective German and
European courts.'

There is still considerable legal uncertainty in the company's previous
core market, Germany. At the same time, planning certainty in the Abroad
segment is comparatively low as yet especially for the new business
activities. It is therefore impossible to make a reliable forecast for
revenues and earnings at this moment in time. The company expects to be
able to make a reliable forecast again in the medium term once the legal
situation has been settled as far as possible and more experience has been
gained outside Germany.

About Tipp24 AG: Tipp24 AG holds equity interests in a number of companies
in Spain, Italy and the UK which enable participation in lottery-based
games via the Internet, especially via the websites www.ventura24.es,
www.puntogioco24.it, www.mylotto24.co.uk and www.tipp24.com. In Germany,
the subsidiary Tipp24 Entertainment operates the games platform
www.tipp24games.de. Shares in Tipp24 AG have been traded at the Frankfurt
Stock Exchange since 2005.


Tipp24 AG       
Andrea Fratini       
Head of Media and Public Relations   
Tel.: +49 40 32 55 33-660
Fax: +49 40 32 55 33-5600     
E-mail: presse@tipp24.de 
Internet: www.tipp24-ag.de/presse/  


28.05.2009  Financial News transmitted by DGAP
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Language:     English
Issuer:       Tipp24 AG
              Straßenbahnring 11-13
              20251 Hamburg
              Deutschland
Phone:        +49 (0)40 325533-0
Fax:          +49 (0)40 325533-77
E-mail:       office@tipp24.de
Internet:     www.tipp24-ag.de
ISIN:         DE0007847147
WKN:          784714
Listed:       Regulierter Markt in Frankfurt (Prime Standard); Freiverkehr
              in Berlin, Düsseldorf, Hamburg, München, Stuttgart
 
End of News                                     DGAP News-Service
 
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