Pacific Online eyes 17% revenue hike

MANILA, Philippines - Pacific Online Systems Corp., the exclusive online lottery system provider of the Philippine Charity Sweepstakes Office (PCSO) in the Visayas and Mindanao, is eyeing P900 million in revenues by yearend or an increase of 17 percent from the 2008 level, largely driven by an aggressive roll-out of new terminals as well as record lotto sales.

Pacific Online chairman and president Willy Ocier said out of the expected revenues, P750 million will come from lotto operations while the remaining P150 million will come from instant scratch tickets, which have become the fastest growing offerings of the PCSO.

The company registered P766 million in revenues last year, up 53 percent from the previous year on the back of intensified distribution of instant scratch tickets and wider reach of its retail operations. It posted a net profit of P138 million, slightly higher than the P135 million net income in 2007.

The company would have earned more were it not for the P48-million provision for the decline in value of marketable securities. Excluding such non-cash provision, Pacific Online’s core net income amounted to P186 million or an increase of 27.4 percent from the year earlier level.

In July alone, sales from instant scratch tickets hit over P500 million, due to the launch of new game variants.

Pacific Online, through subsidiary Lucky Circle,  sells eight Instant scratch games namely Cash Machine, Golden Egg, Go Bananas, Lucky Charms, Otso-Otso, Pares-Pares and Ruby Riches, all of which are sold for P20 each with a top prize of up to P200,000. Another game variant, Ruby Riches, is priced at P50 with a top prize of P500,000.

To boost retail operations and sales, Pacific Online has recently forged a deal with shoe and bag repair chain Mr. Quickie to distribute exclusively ScratchIt tickets in all the latter’s 200 stores nationwide. The ScratchIt tickets will initially be offered in 100 selected stores.

The company is also set to ink a distribution agreement with the 7-Eleven chain of convenience stores next month.

Pacific Online has earmarked P160 million for its capital expenditures this year for the continued rollout of 300 new lottery terminals and 130 new Lucky Circle outlets over the next two years. Around P100 million of this amount will go to the expansion of Lucky Circle outlets.

By yearend, Lucky Circle expects to have a total of 130 outlets.Another 50 Lucky Circle outlets are being planned for construction in 2010 to boost its branch network to 180. – Zinnia Dela Peña