annual report  accounts 2012 888 holdings plc  annual report  accounts 2012
888 is one of the world’s most 
popular online gaming entertainment 
companies 
888’s trusted online brand offers localised 
products providing players the games they 
want in the language they speak with high 
functionality and interactivity in a safe and 
secure environment 
with more than 1600 people in seven 
different countries we provide our leading 
online gaming experience in a total of 19 
languages to over 150 countries and offer 
something for players of all abilities and 
requirements our highly sophisticated 
business analytics identify the best way to 
target people with the offering that will be 
of most interest to them and our market 
leading technology allows us to enter new 
markets quickly and effectively helping 
us to gain significant market share as new 
geographies are regulated the ability to have 
such success in newly regulated jurisdictions 
in turn makes us an indemand business to 
business provider 
888 is a leader in corporate social 
responsibility with specialist websites 
dedicated to both responsible gaming and 
corporate responsibility so that customers 
can play in a safe and secure environment 
we continue to exceed our customers’ 
expectations both in terms of offer and 
customer service so that we can continue to 
grow the business organically and deliver 
value for our shareholders
 01  highlights
 02  chairman’s statement
 03  chief executive’s review
 08  enhanced business review
  08  financial review
  11 operational  review
  17  regulation and general  
   regulatory developments
 21   corporate social responsibility
responsible gaming
 23  risk report
 25  board of directors
 26  corporate governance
 30  directors’ remuneration report
 39  directors’ report
contents
 42  independent auditors’ report
 44  consolidated income statement
 44  consolidated statement of comprehensive income
 45  consolidated balance sheet
 46  consolidated statement of changes in equity
 47  consolidated statement of cash flows
 48  notes to the consolidated financial statements
 80  company balance sheet
 81  company statement of changes in equity
 82  company statement of cash flows
 83  notes to the company financial statements
 85  shareholder information 01
www888holdingsplccom
1  
as defined in the table set out on page 8
2  
casino poker and sport
highlights
up 13
us million
revenue 
376
331
2012 2011
revenue — b2c  
poker 
up 44
us million
88
61
2012 2011
revenue — b2c
up 16
us million
330
284
2012 2011
adjusted ebitda
1 
 
margin
   
per cent
67
56
2012 2011
revenue — b2b
down 2
us million
46
47
2012 2011
revenue — b2c casino 
up 12
us million
165
148
2012
up 20
us million
178
168
2012 2011
adjusted ebitda
1
real money 
registered customer 
accounts
2
131
2012 2011
106
up 23
million 888 holdings plc  annual report  accounts 2012
02
chairman’s statement
2012 has been a record year for 888 we are delighted to 
report an increase in proﬁt after tax from us2 million in 
2011 to us35 million in 2012 the success of our customer 
offering and targeted marketing is overcoming a backdrop 
of global economic uncertainty and helping us capitalise 
on the ever changing regulatory landscape
we have made signiﬁcant progress in driving the business 
forward building on the change in strategic direction 
set in train last year i am delighted that in march brian 
mattingley agreed to take the chief executive officer 
position brian has been a member of the 888 board 
since the ipo and has an excellent knowledge of both the 
business and the wider industry 
brian supported by our senior management team has 
overseen a year in which we reinstated the dividend 
successfully relaunched in the newly regulated spanish 
market — quickly achieving the number 2 position — 
launched a new casino front end expanded our mobile 
platform and established a strong usfacing position to 
name but a few highlights
one of our core strengths is offering our customers 
exactly what they want and our ability to do this has 
been demonstrably successful with growth across most 
of our business lines another competitive advantage is 
the quality and capabilities of our technological platform 
which allows us to tailor our marketing to individuals and 
to target our products in an efficient manner we have 
continued to focus on new regulatory horizons and the 
success of our poker offering in spain shows the beneﬁt of 
being ready for a new market opening we are well placed 
to repeat this success as other markets regulate
financial results and dividend
we have achieved record results this year the beneﬁts 
of continued product development and costeffective 
customer acquisition have resulted in a signiﬁcant increase 
in the group revenue to us376 million a 13 uplift 2011 
us331 million adjusted ebitda was us67 million 
2011 us56 million as at 31 december 2012 the group 
had us82 million of cash and cash equivalents and 
us49 million liabilities to customers 
given the strength of our ﬁnancial performance the 
board took the decision to restore dividend payments at 
the half year and an interim dividend of 25¢ per share 
was paid taking into account the strong performance 
of the business and lack of dividend in 2011 the board is 
recommending a ﬁnal dividend comprising 45¢ per share 
which together with the interim dividend equals 70¢ per
 as deﬁned in the table set out on page 8
share in accordance with our payout policy set out at the 
time of our 2005 ﬂotation and an additional oneoff 20¢ per 
share bringing the total for the year to 90¢ per
people
the record performance that we have achieved this year 
would not be possible without our staff across the world 
1600 people strive to make our strategy come to life and 
it is their commitment passion and ambition that results in 
the ultimate success of our business 
outlook
we have the right strategy and are executing it well as 
we did with spain we have invested in and prepared the 
platform in readiness for us entry and following very 
positive recent regulatory movements in new jersey and 
nevada we look forward to an exciting future
richard kilsby 
chairman 03
www888holdingsplccom
chief executive’s review
introduction
i am delighted that in the ﬁrst year of my tenure as 
chief executive the group has delivered its strongest 
performance to date in our b2c line of business and a solid 
performance in b2b this excellent performance has been 
driven by the successful development of our products 
including the launch of casino 50 our focus on customer 
acquisition and retention and the continued delivery of 
superior customer service and a value for money offer
implicit in our strategy was the desire to improve 
margins therefore we are delighted to have made further 
improvements in the year particularly as we have incurred 
higher gaming duties compared to the previous year 
and we have continued to invest in our business as we 
entered regulated markets we committed us131 million 
to marketing spend which resulted in marketing ratio to 
revenue of 35 slightly higher than that of last year 31
most importantly we have delivered an adjusted ebitda
1
 
of us67 million a 20 increase on last year this 
represents an adjusted ebitda
1
 margin increase from 
168 to 178 at the year end we had us82 million of 
cash of which us32 million was available for general 
corporate purposes having during the year paid us11 
million of retroactive duties to the spanish government 
and settled for us37 million the ﬁnal consideration on the 
wink bingo acquisition 
given the strong cash generation during the year the 
board of directors reinstated the dividend at the half year 
declaring an interim dividend of 25¢ per share that was 
paid on 18 october 2012 taking into account the strong 
performance of the business and lack of dividend in 2011 
the board is recommending a ﬁnal dividend comprising 
45¢ per share which together with the interim dividend 
equals 70¢ per share in accordance with our payout 
policy set out at the time of our 2005 ﬂotation and an 
additional oneoff 20¢ per share bringing the total for the 
year to 90¢ per share
2011 was about going back to basics and 2012 has focused 
strongly on preserving and enhancing our technical edge 
structurally the group is now managed into two business 
lines b2c and b2b whereas b2c is further managed 
in product groups for example pokercasino rather 
than by service areas for example marketing which 
has enhanced our focus and allowed us to utilise our 
technological and analytical strength through a uniﬁed 
approach to product growth
combining these disciplines and bringing our analytical 
strengths to bear at all stages has led to improved 
new product development followed up by targeted 
personalised and data driven marketing and crm 
campaigns all of which in turn lead to maximising player 
lifetime value this concentrated focus on our core strong 
analytics and marketing capabilities has maximised their 
beneﬁts across the business it is these fundamental 
competencies together with our exceptional product 
platform and back office capabilities that have enabled us 
to successfully compete with and surpass our competition
1  as deﬁned in the table set out on page 8 888 holdings plc  annual report  accounts 2012
04
building on our strengths
despite the evolving challenges of the market place 
in which we operate our strategic direction remains 
constant 
our strategy in terms of the customer proposition is clear 
— high quality products with precision targeted marketing 
to attract higher volumes of lower spend more casual 
gamers all of which is supported by exceptional customer 
service
early in 2012 we launched casino 50 our new casino 
front end this is a revolutionary multisoftware platform 
delivering compared to previously a much more exciting 
and interactive experience to our customers it has been 
received well by players and we are now beginning to see 
the fruits of our labour our poker business continues to 
grow with record breaking revenues of us88 million and 
a 31 increase in active players compared to last year we 
remain in the top 5 in terms of global liquidity as reported 
by pokerscout this product group is our star performer 
and we deservedly won the highly regarded egaming 
review poker operator of the year award in november
within our technology infrastructure we have created 
an inhouse games studio designed to develop our 
own “home bred” slots games we have launched ten of 
these slots games during the year of which elm street 
with stunning graphics was the most popular this 
demonstrates the company’s desire to distance itself 
from other operators and provides a unique offering to 
our customers in an area in which we control all of the 
elements required for our ongoing success
the bingo sector remains challenging and this now 
mature market has become highly competitive however 
we remain one of the largest networks in the uk holding 
our own against highly aggressive competitors and we 
will continue to drive this offering and further integrate 
the platform into the group’s state of the art back office 
allowing all the beneﬁts of that to ﬂow through to our 
bingo offering in december we announced an agreement 
with facebook to launch realmoney products the ﬁrst of 
which is bingo appy offering 90 ball 75 ball and 5 line 
bingo including a wide range of slots and instant games 
to date we are seeing strong customer interest but it 
is too early to predict the ultimate success of this new 
market
sport remains an important part of our product suite 
and one which continues to offer opportunities targeted 
marketing has helped to increase revenue year on year and 
we have seen success in our mobile strategy with 30 of 
revenue generated through our dedicated 888sport app 
we are working closely with our partners and assessing 
options through which we can provide 888sport with a 
genuine competitive edge a strategic review is underway 
that will ascertain the best way of fulﬁlling this aim
during the year we have made signiﬁcant progress in 
newly regulated markets in the summer we saw the 
opening of the spanish market albeit three months later 
than was planned given the delayed introduction of the 
new regime we had adapted our software well in advance 
of licensing and following the retroactive duty payment 
we were granted our license on 1 june after effectively 
and efficiently migrating customers to the regulated 
environment we quickly built market share with our poker 
offer becoming number two in the spanish market with 
888pokeres delivering more than 20 market share this 
was achieved by calculated marketing investment and 
further shows the strength of our management capabilities 
in understanding new markets underpinned by the 
efficiency of our customer acquisition strategy
proving just what an opportunity regulation can provide 
for 888 the end result is that poker revenue generated 
since regulation is more than double that preregulation 
even with the deduction of gaming duty we are 
encouraged by this market and we will invest in order to 
grow this signiﬁcant business
chief executive’s review 05
www888holdingsplccom
the italian market has also proved to be successful 
initially launching a brand new casino offering designed 
speciﬁcally for italy in the second half of 2011 with 
cautious marketing spend the launch achieved very 
pleasing results the decision by the italian regulator to 
allow slots from december 2012 has bolstered our offering 
and allowed us to introduce our unique games alongside 
the traditional casino products this has resulted in player 
numbers more than doubling compared to december 2011 
in dragonﬁsh we have now completed the rationalisation 
of smaller unproﬁtable licensees and hence revenue 
decreased marginally by 2 removing the burden of 
unproﬁtable contracts has helped us focus on our core 
strengths concentrating our efforts on attracting large 
scale clients to our platform in addition we have signed 
12 new bingo skins this approach has also released the 
resources to enable us to focus on the anticipated opening 
of the us market
we currently operate caesars interactive entertainment’s 
cie world series of poker online poker brand in the 
uk a collaboration which received the approval of the 
nevada gaming control board and included a ﬁnding by 
the control board of suitability for 888 in january 2012 
we announced a deal extending our relationship with 
caesars that will see dragonﬁsh power a selection of cie’s 
established and recognised poker brands including the 
“wsop” in the us once online gaming is permitted under 
the new regulatory regime
this nonexclusive agreement marked the ﬁrst strand in our 
us online strategy and indicated the strong platform that 
we can use to sign with further potential us partners our 
objective in respect of the us is to become one of if not the 
largest providers of online operations and services in this 
market we have a three part strategy a business to business 
strategy where we are platform software and back office 
providers taking a revenue share a strategic alliance where 
we partner with a supplier which allows us to reach regional 
casino outlets and most importantly a strong b2c offer 
where we bring all of 888’s talents expertise and strengths 
to bear on penetrating this exciting market
in terms of contracts signed todate the cie deal is 
the traditional b2b revenue share operation where we 
supply the technology and the services with our partner 
supplying their expertise and funds on marketing having 
landbased partnerships will be the key to unlocking 
access to regulated us states and it is worth remembering 
that caesars operates casinos in nevada new jersey and 
california all of these are likely to offer online gaming 
upon the potential liberalisation of the market
in july we announced an alliance with wms gaming inc 
which is one of the world’s largest slot and games design 
operators with in excess of 250 secondary and tertiary 
casino customers as one of the biggest suppliers of slot 
machines to hundreds of land based casinos in the us 
this deal will enable wms to offer an online product to all 
its customers utilising our state of the art poker platform  
the agreement will give the group a competitive edge and 
allow the launch of a real money offering concurrent with 
the ﬁnalisation of either federal or state based regulation
after the year end we completed the last strand of 
our three part strategy by entering into a joint venture 
agreement with global investment ﬁrm avenue capital 
group to launch and operate a comprehensive b2c 
gaming offering into the us avenue capital group has 
interests in various terrestrial casinos and entertainment 
companies making them an ideal partner for 888 the 
agreement will provide signiﬁcant investment in marketing 
to take advantage of the regulating us gaming market  888 holdings plc  annual report  accounts 2012
06
and we are enormously excited by the opportunities 
a number of states are currently providing positive 
indications with new jersey legislators passing a bill 
legalising online gaming while the nevada gaming control 
board recommended to the nevada gaming commission 
the approval of the licensing of 888 as an interactive 
gaming service provider the commission hearing will be 
held on 21 march 2013 
as the ﬁrst nonus online operator to be recommended 
we are very well positioned in the us and the business 
foundations are now set we are leveraging our existing 
infrastructure to penetrate the largest gaming market in 
the world and we are only waiting for the regulator to 
allow us to start working
in parallel with our focus on building signiﬁcant market 
share in regulated jurisdictions we have directed resources 
into the development of our mobile offering 2012 was the 
year that the prevalence of smartphones and tablets ﬁnally 
led to the longawaited coming of age of mobile gaming 
and we can expect leadership in mobile to be a signiﬁcant 
revenue and customer acquisition generator the company 
has a devoted team concentrating on mobile applications 
and now has a comprehensive product offering across 
all major platforms including both apple and android 
tablets and smartphones all applications are witnessing 
strong growth in usage and we are conﬁdent that this 
medium will be earnings enhancing
our social gaming business has now been fully integrated 
into 888’s technological architecture and the team is now 
working alongside our excellent product developers it 
is clear that social networks are becoming an integrated 
part of online gaming however and while it still remains a 
nascent industry it is one in which we are well positioned 
to remain ahead of the curve we will continue to review 
our product suite and capitalise on opportunities such as 
facebook realmoney gaming and we expect to continue 
to progress in this area 
regulation
regulation of online gaming continued to be a key area 
of interest to 888 during 2012 as always presenting both 
opportunities and challenges during 2012 we acquired 
two new online gaming licenses — in spain and in the 
german state of schleswigholstein adding to a growing 
list of local licenses held by the group at the same time 
the group remains committed to obtaining local licenses 
applicable to its operations in various jurisdictions of 
choice presenting the potential for commercial growth 
as 2012 drew to an end 888 was approaching the ﬁnal 
stages of the nevada licensing process a lengthy exercise 
commenced in 2011 on 7 march 2013 the nevada gaming 
control board recommended to the nevada gaming 
commission the approval of the licensing of 888 as an 
interactive gaming service provider and in connection 
therewith the licensing of its key executives and controlling 
shareholders the commission hearing will be held on 
21 march 2013 and 888 is on the cusp of becoming one 
of the ﬁrst international online gaming operators to 
commence operations in a us jurisdiction under a local 
license in february 2013 new jersey legislators passed a 
bill legalising online gaming allowing landbased casinos 
in the state to apply for licences to offer casino and poker 
this is expected to be enforced by the end of the year with 
partnerships already in place this positions 888 well other 
us jurisdictions are on the brink of introducing legislation to 
allow for the licensing of online gaming within their territories 
developments that present tremendous opportunities for 
growth
2012 saw a list of european jurisdictions either 
chief executive’s review 07
www888holdingsplccom
adopting new gaming laws or being in the process 
of reforming their regulatory landscape though the 
european commission has renewed its call for greater 
harmonisation between eu member states in this area 
regulatory regimes within the eu remain largely divergent 
posing challenges for the group naturally the growing 
abundance of local licensing requirements is inevitably 
accompanied by the burdens of local taxation and costly 
compliance requirements we continue to remain actively 
engaged in regulatory developments worldwide and seek 
the opportunities for growth presented by regulation while 
continuing to face the accompanying challenges 
a notable development likely to have a particularly 
profound impact on 888 in future years is the bill 
presented in late 2012 by the united kingdom 
government aiming to bring foreign operators under the 
licensing umbrella of the uk gambling commission as 
well as exposing those operators to uk gaming duty we 
will continue to closely follow developments on this front 
during 2013 taking measures to minimise the adverse 
impact that uk gaming reform could have 
responsible gaming
888 is dedicated to providing its customers with a 
responsible gaming environment hand in glove with 
our stated goal of providing our players with the most 
entertaining gaming offering experience is our ﬁrm 
commitment to help prevent compulsive usage and 
underage access of our gaming products we have long 
been recognised as a market leader in this area and 
continue to introduce innovative new measures to ensure 
that our products are used in a responsible way by the 
right people more information could be found at our 
dedicated website www888responsiblecom
2013 focus
we see 2013 as a year of tremendous opportunity we will 
continue to invest in our infrastructure our product offer 
and in regulated markets 
we see high growth potential in spain where we intend to 
build on our strong position as we increase our marketing 
spend without diminishing its analytical costeffective 
targeting the introduction of live roulette and potentially 
slots will also provide growth opportunities as witnessed 
by the introduction of slots in italy at the end of 2012 
which provided a catalyst for further growth in this 
important market
we see our spanish success as the blueprint for entry into 
other newly regulating markets in the united states where 
we are preparing for launch following positive regulatory 
changes we will continue to invest in our technological 
platform the cornerstone of our offer in addition to being 
recommended for a licence in nevada we have been invited 
to apply for a licence in new jersey where a bill legalising 
online poker and casino has been passed
in poker we will continue to develop the platform and 
continue to create variation in the games available to our 
customers casino 50 continues to evolve and we intend to 
remain at the top of the tree in terms of customer lifetime 
value in bingo we will develop more skins and expand 
our offer to ensure maximum coverage is achieved sport 
is already undergoing a strategic review and we intend to 
work with our existing and possibly new partners to ensure 
we optimise its true potential and have the ability to expand 
our brand into new regulated markets social media will 
continue to be an area in which we expand and we will 
carefully monitor the success of these ventures
all of these projects will undoubtedly require investment 
alongside our intention to continue to invest in our technology 
and marketing expertise this investment together with strong 
marketing campaigns and a push into new regulated markets 
will have a shortterm impact on margin growth we remain 
focused on our strategy and believe that any incremental 
expenditure on our core business will ensure future growth 
and improved market share for all our brands
despite success to date we do not believe we have yet got 
close to reaching full potential with our mobile offering 
there is a signiﬁcant opportunity as we increase the 
breadth and quality of our dedicated apps and roll them 
out across the app stores while also making certain that 
the performance of our traditional products is maximised 
on whatever medium our players favour
outlook
we are well placed for the future and believe we have the 
right products the right technology and best in breed 
analytical marketing to provide sustained growth and 
increased market share we also have a highly talented and 
dedicated workforce and i would like to thank our staff for 
helping us achieve these excellent results we are conﬁdent 
of delivering further value to our shareholders in the future
brian mattingley 
chief executive officer 
13 march 2013 888 holdings plc  annual report  accounts 2012
08
enhanced business review
reconciliation of operating profit to adjusted 
ebitda
y ear ended
31 december
2012
1
us million
y ear ended
31 december
2011
1
us million
operating profit 369 146
depreciation 92 90
amortisation 56 40
restructuring costs — 49
retroactive duties and 
associated charges 111 —
share benefit charges 17 24
impairment charges 22 207
adjusted ebitda 668 556
general
888 delivered another record performance in 2012 
with a revenue increase of 13 to us376 million 2011 
us331 million particularly impressive given the strong 
comparatives to the prior year growth was driven by our 
b2c line of business with a 16 revenue increase in turn lead 
by strong poker growth of 44 and casino at 12 at the 
same time b2b almost maintained its prior year revenue with 
a 2 decrease
 
financial review
financial summary 
year ended
31 december
2012
1
us million
year ended
31 december
2011
1
us million change
revenue
b2c


Summary:
 01
www888holdingsplccom
1  
as defined in the table set out on page 8
2  
casino poker and sport
highlights
up 13
us million
revenue 
376
331
2012 2011
revenue — b2c  
poker 
up 44
us million
88
61
2012 2011
revenue — b2c
up 16
us million
330
284
2012 2011
adjusted ebitda
1 
 
margin
   
per cent
67
56
2012 2011
revenue — b2b
down 2
us million
46
47
2012 2011
revenue — b2c casino 
up 12
us million
165
148
2012
up 20
us million
178
168
2012 2011
adjusted ebitda
1
real money 
registered customer 
accounts
2
131
2012 2011
106
up 23
million