CentralNic Sells Premium Domain Names For $2.5 Million

CentralNic plc announced today that it has sold a number of premium domain names for US$2.5 million, satisfied in cash.

CentralNic said that the release of new Top-Level Domains has been slower than anticipated. The result is that while demand for the new TLDs is strong and growing, it is still at a less mature stage than the Board had anticipated.

The Board is also pleased to provide an update on trading for the year ending 31 December 2014 where it confirms profits for the year ending 31 December 2014 will be in line with market expectations.

Sale of Premium Domain Names

As previously announced on 23 September 2014, CentralNic launched a Premium Domains trading business in the second half of 2014. Premium domain names are domain names that trade at a premium to normal retail pricing.

CentralNic has today concluded sales of non-core premium domain names for US$2.5 million, satisfied in cash on completion, the proceeds of which will be utilised to further accelerate growth within the Group, and acquire additional premium domains to augment the existing portfolio.

Trading Update

The Board is pleased with the Group’s overall trading performance to date and is confident that profits for the year ending 31 December 2014 will be in line with market expectations. The Group has transformed its business to include registry, registrar and enterprise divisions that reflect a diversified international business specialising in domain name sales and related services, including a Premium Domain Trading business that through this transaction is already contributing to CentralNic’s performance.

CentralNic’s strategy

When CentralNic listed on AIM, the Group’s strategy was to diversify its business activities in the domain name industry.  It has succeeded in executing that strategy with the Group having exposure to the growth and re-organisation of the internet through the following activities:

• retailing domain names via online stores such as internetbs.net, buydomains.london and domains.luxury whilst also offering consumers complementary services such as web hosting and website builders;
• trading and providing broking services in Premium Domain Names, owning a trading portfolio of almost 20,000 Premium Domains;
• offering domain-name-related services, consultancy and software solutions for major brands including best-of-breed domain name portfolio management and distribution;
• providing consultancy and outsource domain registry services for developing markets;
• investing in innovative new TLDs with differentiated business models; and
• extending its role as an industry leader in the distribution of domain names (including new TLDs).

Top-Level Domains (“TLDs”)

As generally recognised the release of new Top-Level Domains (“TLDs” or new suffixes for domain names to supplement .com and .co.uk – such as .website, .wiki and .xyz) has been slower than anticipated. These delays have been due to a number of factors, impacting the entire new TLD programme. The result is that while demand for the new TLDs is strong and growing, it is still at a less mature stage than the Board had anticipated. These delays have caused ICANN, the regulator and administrator of the new TLD programme, to downgrade their demand projections from 33 million to 15 million domain registrations under new TLDs by June 2015.

CentralNic’s performance to date on new TLDs

The Board remains highly confident that CentralNic has confirmed its position as a global leader among the new TLD distributors.  It is ranked number two in the world by industry statistics website ntldstats.com, positioning the Group as the leading registry services provider in Europe (source: http://ntldstats.com/backend).  This success reflects strong demand for CentralNic’s .xyz, a mass-market new TLD which to date has more registrations – with over 730,000 domains – and more active websites than any other new TLD (source: http://ntldstats.com/).

CentralNic has successfully launched a total of 11 new domain extensions in 2014, including: .wiki, .ink, .xyz, .bar, .rest, .website, .press, .host and .space, as well as the new generic .co.com and .com.se as a new domain for Sweden.

CentralNic’s next wave of new TLDs

The Board expects CentralNic to be the exclusive registry service provider to at least 35 new TLD’s over the next 2-3 years. The Group has also been confirmed as the exclusive global distributor and billing agent for the following new TLDs to be launched from 2015:

.site – ranked by industry experts as among the top five most desirable new TLDs

.design – a domain suited to graphic, web and interior designers

.tickets -a full ticketing transactional platform integrated with a .tickets domain name – for validated venues, sports teams, entertainment artists and travel industry operators, providing consumers with safe, authentic ticket purchases. CentralNic has a number of exposures to future revenues generated by Accent Media Limited, the successful applicant for .tickets, and through its investment is also a 12% shareholder.

Other CentralNic new TLDs still to be launched include .college, .fans, .feedback, .contact, and .pid.

CentralNic and its clients are in contention with other applicants to secure an additional 20 new TLDs which include .love, .online, .gay, .app, .blog, .cafe, .web, .style, .forum, .art, .golf, .llc, .school, .store, .shop, .music, .doctor, .bank, .ping, and .baby.  The Group is also in discussion with applicants for new TLDs who would like to transfer from their existing provider to CentralNic’s platform.

CentralNic CEO Ben Crawford said:  “CentralNic and its clients have a number of high quality new TLDs and with our partners we intend to build on our results to date in leading the re-organisation of the domain name system.  This year we have been successful in diversifying our business by entering the retail, enterprise and premium domain markets, where we have a commercial interest in a significant portfolio of premium domain names of varying values. We look forward to continued development of our registry business and these new lines of business as we enter 2015.”