888 Releases Q1 Trading Update: Positive Performance Across Divisions

888 has released its trading update for the three months ending 31 March 2024 (“Q1-24” or the “Period”). Group revenue stood at £431m, slightly surpassing the previously forecasted range. Revenue increased by 2% compared to Q4 2023, indicating a positive sequential quarter-on-quarter trend. The Group anticipates revenues to resume year-on-year growth from Q2 2024 onwards, aligning with its mid-term target of 5-9% annual growth.

In the UK&I Online sector, monthly active engagement surged by 9%, while revenue witnessed a marginal 1% decline. Internationally, revenues saw a 6% uptick compared to Q4 2023, with February and March experiencing a return to year-on-year growth, primarily driven by core markets like Italy, Spain, and Denmark. Conversely, the Retail segment faced a 7% revenue decrease, aligning with Q4 2023 figures.

The Group announced its new strategy, Value Creation Plan (VCP), on 26 March 2024, with clear medium-term financial targets. These include growing revenue by 5-9% per year, improving adjusted EBITDA margin by approximately 100bps per year, and focusing on deleveraging to reach net leverage of 3.5x or below by the end of 2026. A new corporate identity – evoke plc – will be launched in May 2024, subject to shareholder approval at the AGM on 13 May 2024.

Progress has been made in resetting the operating model, with £30m in 2024 operating cost savings redirected towards marketing initiatives. Additionally, the strategic review of the US B2C business concluded, with selected asset sales and closures expected in 2024, subject to regulatory approvals. This move is anticipated to deliver an ongoing EBITDA improvement of £25 million per year from 2025.

Per Widerström, CEO of 888, commented: “I am pleased to report that Q1 2024 revenue was slightly ahead of our guidance, with strong player volumes converting into improved revenue run rates. Having lapped various regulatory and compliance changes during the quarter, and with increased marketing investment supported by an exciting product pipeline, we remain confident in a return to growth from Q2 2024.

I was delighted to outline our multi-year value creation plan alongside our full year results in March, and am pleased to report a strong quarter of progress against these plans. We are moving decisively and at pace to position our company for long-term success, and I look forward to providing further updates about our progress in the coming months.”

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