Positive trading report from Neteller

19.04.2008

The Isle of Man based e-processor Neteller plc has announced a Q1/2008 rise of 5 percent in revenues compared to Q4/2007 in its trading report this week, indicating that its strategy to build business in Europe and Asia is succeeding, albeit slowly, enabling the company to continue its recovery after a costly exit from the lucrative US market in late 2006.

Staff numbers at Neteller were slashed by more than half to 425 after the move and the group ended up booking pre-tax losses of US$ 185.8 million for 2007.

Revenues during the first quarter 2008 were US$ 17 million, up 5 percent on the previous three months, with average daily sign-ups for the e-wallet's gaming service up 4 percent to 1,122 when compared with the last quarter. Total active e-wallet users rose 2 percent to 101 301.

Average daily receipts from e-wallet users were approximately US$ 365 000, up 11 percent from the previous quarter and 22 percent better than a year ago.

However, compared with Q1/2007 when revenues of US$ 18.3 million were recorded, a 7 percent decrease is apparent.

The firm, which also offers general online payment services such as Netbanx, said it had signed up several new gaming and non-gaming merchants, which it expects to deliver "tens of millions" in extra transactions.

President and chief executive Ron Martin, commenting in the statement, said: "The business has continued to deliver a good performance in the first quarter. Growth in our key European and Asia Pacific markets remains encouraging and as we introduce new payment solutions and targeted marketing programmes, we hope to see this momentum continue."

In percentage terms, the biggest increase in revenues over Q1 came from Asia, where Neteller has been marketing vigorously. The region delivered an increase of 20 percent, bringing revenues to US$ 3.6 million. European operations yielded a 9 percent rise in revenues to US$ 11.3 million when compared with Q4/2007 numbers.

The company’s balance sheet as at 31 March 2008 shows US$ 55.2 million cash.