Australian internet lottery company Jumbo Interactive (ASX:JIN) has flagged plans to focus solely on its online lottery division with plans to pursue the overseas markets, following its software distribution subsidiary being put into voluntary administration in January.
In an ASX statement, the company, which runs the OzLotteries.com website, noted its software distribution arm is in the process of being “wound down” to allow greater focus on its “stronger” internet lottery business.
Revenues posted for the software distribution business were just $3.2 million for the half year period to 31 December 2010, a 34 per cent fall on the previous corresponding period due to its discontinued operations. Revenue for internet lotteries grew 18 per cent to $36.3 million.
The company’s lottery sales in Australia grew from $25 million to $66 million over the last three years with the company indicating plans to move the business overseas.
“The A$60 billion US lottery market has not yet moved onto the internet due to federal restrictions. The Company has been pursuing opportunities in anticipation that these restrictions will be lifted and would like to use its early mover advantage to secure contracts,” the ASX statement read.
According to the statement, the company has also begun pursuing the $A110 billion European and $10 billion Canadian lottery markets both of which do not have the same restrictions as the US.
Overall, the company reported a 185 per cent increase in net profits after tax of $3.3 million, including a $0.7 million loss from the software distribution business, which was in line with its recent earnings forecast. Revenue also jumped 11 per cent jump to $40 million for the half year to 31 December 2010.
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