Burswood plans to net online gambling dollar

BURSWOOD wants to deal into Internet gambling, which is expected to be worth US$2 billion next year.

Burswood managing director John Schaap told the estimated 400-strong crowd at the company’s annual general meeting this week, that Internet gambling was an important growth area.

“We’re keen to enter the market for both competitive and defensive reasons,” Mr Schaap said.

The Federal Government failed to put a moratorium on Internet but the issue still lingers. Mr Schaap said Burswood would consider basing its Internet base in another state or even another country, depending on the legislative regime.

The company has already set up an Internet gaming operation on its website but the games are played only for fun.

Burswood’s management is chasing growth opportunities for the company within and outside its core businesses.

Its chance to manage a South African casino for Durban Ventures was stalled in August by the Durban Government but it is still looking for other opportunities.

Burswood chairman David Young flagged potential sales of the Burswood Dome and Hotel. The company wants to keep management control of those assets.

Burswood expects a windfall from its development of the 19.1 hectare Swan Portland Cement site which offers views of the Swan River and Perth CBD.

The completion of Burswood’s $65 million to $70 million expansion is expected to increase visitor numbers by 10 per cent to 14,500 people per day in the first year.

Mr Young said the company’s 74¢ share price was considerably undervalued. He wants it to be seen as growth stock rather than a yield issue.

Traders believe Burswood’s stocks are still going through considerable change following its jump from a trust to a company and unfranked to fully franked dividends.

Its yield of about seven per cent is still not grabbing investors because interest rates are high.

JB Were manager WA Ron Bennetts said Burswood would probably not be a high priority stock for long-term investors given the results of some of the blue chip companies, particularly banks.

Burswood closed the year with marginally higher than expected profit after tax and abnormals of $32.1 million – 3.7 per cent higher than the previous year.