Join our community of smart investors

NetPlay TV hits the jackpot

RESULTS: Shares in interactive gaming company NetPlay TV have jumped a chunky 42 per cent since our companies editor Simon Thompson's buy advice

The growing popularity of casino and roulette gaming - through television, but increasingly through mobile and tablet devices - is proving good news for interactive gaming company, NetPlay TV (NPT). Indeed, full-year net revenue jumped 27.5 per cent to £21.8m and cash profit soared 30.5 per cent to £4.3m.

IC TIP: Buy at 17.8p

That strong growth was helped by marketing spend, which grew 57.5 per cent in 2012 to £9.2m. This included revenue share agreements in respect of key broadcast relationships with ITV and Channel 5, as well as advertising costs. Yet, despite this, the cash profit margin still rose 40 basis points to 19.8 per cent. Management has also signed a new contract with ITV, increasing broadcasts from four night a week to six nights. What's more, NetPlay TV's progress has continued into the new financial year. In the first quarter, for instance, the group experienced a 42 per cent year-on-year increase in new depositing casino players, with a 39 per cent year-on-year increase in active depositing casino players. From those new customers, some 34 per cent use mobile and tablet devices - up from 9 per cent in 2012's first quarter.

Broker Daniel Stewart expects pre-tax profit of £4.2m, giving EPS of 1.4p (from 1.2p in 2012).

NETPLAY TV (NPT)

ORD PRICE:17.8pMARKET VALUE:£51m
TOUCH:17.5-18p12-MONTH HIGH:19.8pLOW: 9.1p
DIVIDEND YIELD:2.1%PE RATIO:15
NET ASSET VALUE:5p*NET CASH:£12.3m

Year to 31 DecTurnover (£m)Pre-tax profit (£m)Earnings per share (p)Dividend per share (p)
200819.8-0.99-1.13nil
200918.5-8.40-5.54nil
201019.8-14.2-6.73nil
2011**20.70.550.20nil
201227.33.141.200.38
% change+32+471+500-

Ex-div: 22 May

Payment: 13 Jun

*Includes intangible assets of £5.3m, or 2p a share

**Restated