05/13/2009 11:00PM

Youbet's first-quarter income up 51 percent


Youbet.com, the online horse race wagering company that also owns one of the three dominant bet-processing companies in the U.S., had net income of $1.2 million in the first quarter of 2009, up 51 percent compared to net income of $800,000 in the first quarter last year, according to financial statements released by the company Wednesday.

Handle through the company's domestic wagering platform increased 30 percent compared to last year, and wagering revenues for the quarter were up 16 percent compared to first-quarter revenues in 2008. Youbet cited agreements that have allowed the company to offer the racing signals controlled by Churchill Downs and Magna Entertainment this year as the main drivers behind the handle and revenue growth.

The growth in handle was particularly robust for an industry that is seeing widespread declines in wagering. According to Equibase, which collects data for the racing industry, handle this year on U.S. races was down 9.3 percent in the first quarter compared to last year.

Youbet's bet-processing subsidiary, United Tote, had a net loss of $1.2 million in the quarter, compared to a loss of $800,000 in the first quarter last year. Bet-processing companies collect the majority of their revenue through fees on betting, and the overall decline in wagering dragged the results down. United Tote also lost several contracts with racetracks. Youbet has said that it is attempting to sell United Tote.