Despite an encouraging first half for sports betting minnow Betbrokers, its expected breakeven is likely to be delayed until next year due to product delays and slower-than-forecast customer uptake.

Betbrokers plays the middleman between punter and a range of bookmakers to offer larger bets than would normally be accepted by a single bookie. The company, which also acts as a clearing house between bookmakers, finished a busy six months to June with more than double the number of retail clients at 1,092.

A hitch is that the take-up of new clients has not been as astronomical as was first predicted and the introduction of new online services, including small-order executions, has been put back to next year. In reaction, house broker Hanson Westhouse has reversed its £1.4m forecast pre-tax profit to a £168,000 loss.

Cash burn of £1.9m during the period, moderated by an £810,000 fundraising, has left £395,000 of net cash. Executive chairman Wayne Lochner says the cost base is now ‘fixed’ and, with an office running below full capacity, he expects to be firmly ‘cash positive’ in the second half.

The next six months are ‘all about building more revenues’, stresses Lochner, and aiding this will be the $6.5m (£3.2m) acquisition – satisfied by the issuance of new paper at 4.5p – of Las Vegas-based Winning Edge, a US sports information and tipping service.

Although the shares, more than two-thirds off their float price of last year, look attractive on 2008 earnings forecasts of 0.4p, GCI recommends investors wait until customer numbers increase and previous optimism turns into reality. Avoid for now.

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