ECONOMY

Consultant by October

Gaming monopoly OPAP expects to pick a consultant for its flagship sports betting game Stoichima by October at the latest, its chief executive said yesterday. Earlier this month, the company finalized the details of a tender seeking an international consultant to help it manage the Stoichima game for a one-and-a-half year transitional period. Stoichima allows gamblers to bet on foreign soccer matches, its main area, but also covers other sports, including basketball and tennis. Battered by rising competition from on-line betting companies, OPAP, one of Europe’s largest gaming companies, has decided to manage the game in-house in an effort to cut costs. Intralot currently manages Stoichima and receives a commission of around 10 percent of the game’s total sales. But its contract expires in January 2007. «We will have a consultant by September or October,» Basile Neiadas told an analysts’ conference. On Wednesday, the company reported a lower-than-expected 1.4 percent rise in first-quarter net profit to 122.6 million euros ($156.5 million) after it raised the payout from Stoichima to attract more players. Neiadas also said the Soccer World Cup next month would have a positive impact on Stoichima. «Four years ago when the World Cup was in Korea and Japan the sales (from Stoichima) exceeded 100 million euros. We estimate our sales for this World Cup will be significantly higher,» he said. Looking ahead, Neiadas said OPAP planned to offer its second-largest game, Kino lottery, in foreign markets next year. «This is something that will happen later next year but it is a good opportunity for OPAP to attract thousands of tourists in Greece that do not frequent our agencies right now,» he said. Foreign gamblers can now play Kino only at OPAP’s 5,540 outlets in Greece and Cyprus. He said the company was also considering changing or increasing Kino’s playing hours in an effort to boost the game, which saw first-quarter sale dropping 2 percent to 436.9 million euros. OPAP trades at 16.06 times 2006 earnings, much lower than the 23.57 times multiple for the European casino and gaming sector, according to Reuters Estimates. Analysts say the main reason for the lower valuation is OPAP’s delay in extending Stoichima to Greek soccer matches. The extension has been delayed by about a year while the company waits for government approval. Gaming systems operator Intralot reported a 31.3 percent rise in first-quarter net profit yesterday, thanks to strong foreign and domestic sales. Intralot, the world’s third-largest gaming systems operator by revenues, said net profit rose to 24 million euros ($30.67 million) from 18.3 million euros a year earlier. Its shares were 0.29 percent up at 21.08 euros in mid-session, while the wider market was 0.62 percent up. The results had little impact on the shares as the company had released its forecasts for first-quarter sales and pretax profit at an annual shareholders meeting earlier in the month, said an analyst who declined to be named. Earnings before interest, tax, depreciation and amortization (EBITDA) rose 99 percent to 71.8 million euros. Group sales grew 75.1 percent to 179.8 million euros with revenues from foreign operations amounting to 76.2 percent of the total figure, up from 72.0 percent last year. Foreign operations contributed 72.5 percent to the group’s pretax earnings of 65.6 million euros. The company’s domestic operations also rebounded. Intralot, with operations in 33 countries around the world, has set an aggressive global expansion plan, clinching deals in Europe, Africa, the Middle East, Oceania and the Americas in recent years. The firm has bid for more IT contracts in South Africa and Australia, expecting tender results in these countries by the end of June. It recently announced new deals in Taiwan and Idaho, in the United States, and it has also set its sights on Turkey and Russia.