Youbet posts first-quarter loss

Youbet.com lost $527,000 in the first quarter of 2010, a $1.3 million swing from the $820,000 profit the company posted in the first quarter of last year, according to financial statements released late Thursday.

Revenue during the quarter was $26 million, a 7.1 percent drop from revenue during last year's first quarter of $28 million. In part, the decline in revenues was related to a 6.7 percent drop in wagering handle through the company's account-wagering platform, from $124 million in last year's first quarter to $115.7 million this year.

The decline in wagering handle is atypical for Youbet, one of four large account-wagering companies in the U.S. Youbet and other account-wagering companies have steadily grown for the past decade, though that growth began to slow significantly during the recession.

In a release, Youbet said that the number of people who bet through the account-wagering operation increased by 7 percent in the quarter compared to the first quarter last year. However, the average amount that customers wagered during the quarter declined 13 percent, the company said.

Late last year, Youbet reached an agreement to merge with Churchill Downs Inc. The transaction is still being reviewed by regulators, but Youbet said in the release that it expected the deal to close in the second quarter.

Youbet is the second-largest account-wagering company in the U.S., by handle. It also owns a bet-processing company, United Tote.