Empire Online to close US gambling unit

LONDON - Gaming group Empire Online says it will terminate its business in the United States immediately ahead of a ban on internet gambling which will have a "material" adverse impact on its future earnings.

The group added that around 65 per cent of its revenue is currently generated from US-based customers, and it was one of a number of UK gaming groups such as PartyGaming Plc to end their gaming activities in the US

The moves came as US President George W. Bush prepared to sign into law legislation to enforce the prohibition of internet gaming.

"The company's margins will also be affected by the loss of this revenue due to operational gearing and the higher gross margin generated from the USA business," the group said in a statement.

The gaming group added it was confident it will continue to generate positive earnings before interest, tax, depreciation and amortisation for 2007, and it reaffirmed its intention to pay an interim dividend of 1.7 cents per share.

- REUTERS