WPT Enterprises, the parent company of such properties as the World Poker Tour, and the PPT (Professional Poker Tour) got its report card today, as the company announced its first quarter results. The stock (NASDAQ: WPTE) has been trading publicly since August of last year.
Revenues for the first quarter of 2005 were $4.1 million. WPTE reported a net loss for the quarter of $1.6 million or about 8 cents a share.
"Our first quarter 2005 results demonstrate the company's continued ability to execute on our strategic plan and initiatives that have been targeted to generate growth," said Steve Lipscomb, President and CEO of WPTE. "The success of the show and strength of the brand was confirmed by the Travel Channel's decision to exercise its option for the fourth season of the show. In addition, the show's strong ratings in international markets enabled us to complete distribution agreements to broadcast the show in France and Italy, two major European markets. The WPT continues to achieve worldwide recognition."
The picture is a bit deceiving, as there weren't very many shows to deliver in the first quarter, and expenses were high as they include all production expenses on the PPT shows, which have yet to be sold to a television outlet. The company cut new deals to distribute its World Poker Tour show to France, and Italy, and also had higher than expected licensing revenues.
Wall Street did not react positively to the news, as the stock was down about 4.5% during trading, and off another 4% during after hours trading.
Second quarter revenues will be up substantially, mostly due to increased show delivery to the Travel Channel. The company is incredibly cash healthy, as there is over 30 million in cash and short term investments, and zero debt.
"I am encouraged by the overall growth of our franchise in general as indicated by the increase in total players and prize pools in Season 3 of the WPT," continues Lipscomb. "We are also excited by growth trends in the online gaming space and believe that the second quarter deployment of wptonline.com, our online gaming website, will further diversify our revenue base as well as create additional opportunities in various business segments. We continue to make progress on the strategic objectives that were set for 2005 to enhance shareholder value."
The launch of the real money online site (the last I heard, the site will only be available to players outside the US due to legal restrictions) will no doubt provide a huge boost to the company's bottom line, and eventually probably be its largest revenue stream. The WPT brand is strong, and getting stronger overseas, so the future is incredibly bright for WPTE. If they could allow American players, you could argue they would be a top three online poker site right away, just based on the strength of the brand.
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