Youbet.com reported Monday that revenues rose 59% and operating expenses increased 32% during the first quarter of fiscal year 2002 and announced the election of Larry Lucas as chairman of the board. Also, the online event and wagering company reported handle derived from wagering activity fell 2% to $27.1 million during the period when compared with the $27.5 million in handle for the first quarter of fiscal 2001. Youbet.com's net loss for the first quarter this year was also greater than for the same three months one year ago.
The revenue increase, to $2.6-million from $1.6 million during the first three months of 2001, and the increase in operating expenses were primarily related to the TotalAccess (Oregon wagering hub) operations that commenced in September of 2001. Increased operating expenses were also attributable to track-related commissions and commissions paid to the TVG Network.
Sequentially, the company reported a revenue increase of 43% over revenue of $1.8 million for the fourth quarter ended December 31, 2001 resulting from a higher level of wagering activity through the Youbet Network. On a sequential comparison, Youbet.com had a 25% decrease in total operating expenses from the fourth quarter of 2001 due to a substantial reduction in general and administrative expense. General and administrative expenses for the fourth quarter 2001 included a $2.5 million write-off of capitalized software related to Youbet.com's online sports wagering platform.
The company also reported that administrative and amortization expenses increased significantly due to the amortization of licensing rights.
In Monday's report, Youbet.com said:
-- EBITDA (earnings before interest, taxes, depreciation and amortization) was $(1.5) million for the first quarter of 2002, a 26% improvement over EBITDA of $(2.0) million for the first quarter of 2001.
-- First quarter 2002 net loss was $(2.9) million, or $(0.15) per common share, compared to a net loss of $(2.4) million, or $(0.12) per common share, for the same period in 2001. Sequentially, the Company narrowed its net loss 47% from a net loss of $(5.5) million, or $(0.28) per common share, for the fourth quarter of 2001.
-- As of March 31, 2002, Youbet.com had total assets of $18.6 million including cash and cash equivalents of $3.0 million. Stockholders' equity in Youbet.com totaled $13.9 million.
"The end of the first quarter marked the beginning of solid momentum in terms of wagering activity through the Youbet Network," said CEO David Marshall. "Our acceptance of wagering by California residents began during February bringing significant new customer activity for the quarter. Last month, we introduced content for the first time from premier racetracks including Churchill Downs, Hollywood Park, Saratoga, Del Mar, and Arlington, among others. We are also off to a great start regarding Triple Crown action, with record-setting handle and new account sign-ups surrounding the Kentucky Derby. With these developments, we are making important progress on our enhanced marketing initiatives and strategies for broad Youbet.com Network utilization and exposure."