euro adhoc: betbull - The European Betting Exchange Plc. / Annual Reports / Betbull announces 2005 Audited Results and a Year of Significant Growth and Change

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31.03.2006

Betbull announces 2005 Audited Results and a Year of Significant
Growth and Change

Ad-hoc Notice - 31st March 2006

Financial highlights: Betbull group with considerable growth in QIV

. Betbull Group Results for the year 2005
- Net gaming revenue of £2.7 million
- Adjusted operating loss of £2.8 million (£3.6 million after share
benefit charges)
- Healthy cash position at year end of £7.3 million
. Betbull Group Results for QIV 2005 (unaudited)
- Net gaming revenue of £2.6 million
- Operating loss of £0.1 million (before £0.9 million after share
benefit charges)
. Leip Group Results for the year ended 2005 above expectations

Business highlights: Strategic Repositioning successfully completed

. Acquisition of the Leip Group, a major German retail betting group,
fuelling further growth
. Subsequent private placing to fund the acquisition of the Leip Group
. Relaunch of the exchange betting websites www.betbull.com and
www.betbull.de
. Completion of a corporate restructuring and cost cutting program

Financial highlights: Betbull group with considerable growth in QIV

Betbull Group Results for the Year 2005

Net gaming revenue of £2.7 million The successful acquisition of the
Leip Group at the end of QIII ensured a significant increase in net
gaming revenue in 2005 (2004 - £0.1 million2,000).

Adjusted operating loss of £2.8 million (£3.6 million after share
benefit charges) Operating activities yielded a loss of £2.8 million
mainly due to marketing and operating costs for the exchange betting
business in QI-QIII. The betting exchange operating activities for
2005 yielded a loss of £2.33.0 million. The cost of running the
exchange betting business has been reduced considerably with the
intention to reduce it further. The total operating loss of £3.6
million includes the non-cash share benefit charges in the amount of
£0.8 million due to the application of IFRS2 (Share-based Payment).

Healthy cash position at year end of £7.3 million Betbull maintains a
healthy cash position going forward to 2006, enabling the company to
continue its dual strategy of growing its retail business while
aggressively seeking out complementary acquisitions.

Betbull Group Results for QIV 2005 (unaudited)

Net gaming revenue of £2.6 million The group net gaming revenue for
QIV 2005 amounted to £2.6 million up from £0.1 million for QI-QIII
2005 cumulative.

Operating loss of £0.1 million Group operating loss for the same
period yielded a significant reduction in loss down toof £0.1 million
compared to a loss of £2.4 million for QI-QIII cumulative. The
business focus and acquisition has resulted in a move towards a break
even point. The Directors duly expect QI 2006 to outperform their
budget expectations and show further growth.

QIV figures are stated before any share benefit charges.

Leip Group Results for the year ended 2005 above expectations (only
QIV contained in Betbull Group Results for the year 2005) The Leip
Group outperformed expectations in 2005, and has increased the number
of shops in its network, continuing this expansion into 2006, with
new shops opening month on month.

Issue of warrants and share options In 2005, as part of its strategy
to lower overheads, certain directors and employees were awarded
warrants and share options (under a company employee share option
scheme). In 2004 Erste Banbk were also granted options as part of
the compensation package as lead arranger and book runner for the IPO
of Betbull in October 2004, and corresponding to 5% of the then
placed volume. These had no cash impact on the group, but under IFRS
2 this results in a charge of £0.8 million for the year.

Business highlights: Strategic Repositioning successfully completed
Acquisition of the Leip Group of companies: a major German retail
betting group and subsequent increase in size of business Betbull
acquired the Leip group of companies, including a major German retail
betting operation taking bets from 84 outlets, effective from 1
October 2005. The labels include Wettenleip, Penalty, and
Primebet.com. The rationale for the transaction was to leverage
existing know how and resources in a move to capitalise on the
emerging retail betting opportunities across Continental Europe, in
particular, in Germany. The acquisition is the starting point in
Betbull's strategy to build a leading Continental European retail
betting group. The Directors believe that Betbull, now including the
Leip group of companies, has the expertise, personnel, outlets and
licenses to quickly grow in the German retail betting market and
realise opportunities in other Continental European countries.

The Leip group of companies was purchased for an aggregate initial
consideration of E10 million in cash and the issue of 700,000
ordinary shares. A deferred consideration of up to a further E7.5
million and 300,000 ordinary shares is payable subject to the
achievement of hurdle levels of EBITDA and gross profit by the
businesses acquired for each of the calendar years up to 31 December
2010. A deferred consideration payable in respect of the year ended
31 December 2005 shall be satisfied by the issue of 300,000 Ordinary
Shares to the sSellers which will be carried out following the filing
of the annual report. In respect of each subsequent year the deferred
consideration payable will be capped at E1.5 million payable in cash.

Alexander Leip, previous owner of the Leip group of companies, will
continue to manage German retail betting operations and became an
executive director of Betbull upon closing the acquisition.

The Leip Group has increased the number of shops in its network from
84 (as of end of QIII 2005) to 100 (as of end of QI 2006) fuelled by
the injection of growth capital and the formation of a team dedicated
to growing the installed base. In particular, the number of directly
owned shops was considerably increased.

Subsequent private placing to fund the transaction Betbull raised in
the course of a private placing, in connection with the acquisition
of the Leip group of companies, a net amount of E11.5 million through
the issue of 1,916,667 new ordinary shares, mainly to institutional
and strategic investors.

Relaunch of the exchange betting websites Betbull relaunched the
websites www.betbull.com and www.betbull.de on a new platform,
provided by the Global Betting Exchange. The rationale for the
relaunch was to enhance liquidity and functionality of the existing
offering and to lower operating cost. Both goals were achieved.

Completion of a corporate restructuring programme Betbull completed a
corporate restructuring and cost cutting program reflecting the new
organisational requirements arising out of the relaunch of the
websites, the goal to lower operating cost for the websites
significantly, and the acquisition of the Leip group of companies.
Operating staff are now largely concentrated in Frankfurt and Malta,
with minor presences in Gibraltar and London. Betbull's license base
currently covers licenses in Malta, the United Kingdom, and Germany.

Strategy Betbull's mission is to become a Continental European
household name in retail gaming, with a complementary online
offering. This mission is driven by the Directors' belief that
gaming will move out of its current niches and become a regulated and
thriving market in major Continental European countries. It is
Betbull's strategy to grow the retail betting business through new
outlets, additional products in existing outlets, and to enhance the
existing complementary internet and telephone betting offering.

Betbull intends to maintain a position in the German leading group,
by substantially growing its presence organically and through
targeted acquisitions. Other Continental European countries are
targeted with tactics reflecting their state of regulation, market
potential, and available acquisition targets or local partners.
Spain is one of those countries and the Directors have resolved to
establish a presence there. The Directors believe that the highest
value is being created by operating proprietary betting shops as
opposed to other models, including pure agent based or franchise
models. However, this does not exclude the application of these
models where regulatory or competitive circumstances make them
favourable.

Apart from growing the operational base Betbull's strategy also
includes the introduction of additional new products and systems
aimed at capturing additional profit contributions from existing
customers as well as winning new customers while maintaining stable
outlet operating cost.

Finally, the current complementary internet and telephone offering
under www.primebet.com will be gradually enhanced to capture
additional value from the retail customers. The betting exchange
business will be run at a reduced cost base and reviewed regularly.

Outlook Like for like comparisons (unaudited) of the group for QI of
2006 are substantially ahead of results for the same quarter in the
prior year. February has seen the highest historic group net gaming
revenue.

Directors Manfred Bodner stepped down as a non-executive Director on
21 December 2005. With the acquisition of the Leip Group complete Mr.
Bodner felt the company well positioned beyond its start up phase and
plans to focus on other challenges. The board is very grateful to Mr.
Bodner for his outstanding contributions and counsel since the start
of the company and wishes him all the best in the future.

*** ENDS ***

Press Contact
Alex Mackey, Catullus Consulting (+44 7773 787 458)
Catriona MacNiven, Investor Relations
Günter Schmid, CEO (upon request)
Simon Bold, COO (upon request)

Phone +350 77331
Fax +350 44554
betbull - The European Betting Exchange Plc ("betbull")
1 London Wall
London EC2Y5EB

This communication can be downloaded from the website
www.betbullplc.com.

About betbull Betbull has the goal to establish itself as one of the
leading Continental European retail betting players.

The high caliber management team (Simon Bold, Alexander Leip, and
Günter Schmid) can resort not only to state of the art bookmaking and
operating know how but also relevant M&A expertise and track record.

Betbull was started in 2004 as a joint venture of betandwin.com
Interactive Entertainment AG (stock quoted on the Viennese stock
exchange) and Fun Technologies Plc (formerly traded as CES-Software
Plc, stock quoted on the Alternative Investment Market in London) and
is stock quoted since October 2004 on the Viennese stock exchange
("BETB", "BETB.VI").

For further details please refer to the company website
www.betbullplc.com.

This communication contains statements about the future (prognoses).
Those statements are based on the Director's opinion, assumptions
made by the Directors, and information available to the Directors.
One or several factors that the Directors cannot foresee with
certainty could result in outcomes and events that deviate from the
prognoses. All prognoses are valid only on the date of their
announcement. Betbull has no intentions to and is not obliged to
update prognoses or to adapt prognoses to future events or
developments.

end of announcement euro adhoc 31.03.2006 23:32:53
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ots Originaltext: betbull - The European Betting Exchange Plc.
Im Internet recherchierbar: http://www.presseportal.de

Further inquiry note:
betbull - The European Betting Exchange Plc.
Catriona Macniven
Investor Relations
Tel.: +350 77331
e-Mail: c.macniven@betbull.com

Branche: Casinos & Gambling
ISIN: AT0000615331
WKN: A0DKM0
Börsen: Wiener Börse AG / stock market