All Aboard the GVC Express
Hot on the heels of buying Portuguese online operator Bet.pt and posting better-than-expected Q3 trading stats, British gaming giant GVC Holdings is now projecting massively improved financials for coronavirus-hit 2020.
The FTSE 100 player expects year-end income to be approximately £50m (US$64.5m/€55m) more than previous estimates.
Isle of Man anchored GVC predicts a 2020 EBITDA–earnings before interest, tax, depreciation and amortisation–in the range of £780m (US$1b/€856m) with the proviso that there are no more major Covid-19 disruptions.
Commenting on Q3 performance, GVC Chief Executive Shay Segev said:
“This has been another strong period for the company. We have delivered market share gains in all our major territories. GVC is primed for further growth.
“The momentum that we are seeing across the group is a clear testament to the resilience of our highly diversified business model, the attractiveness of our brands and products, the power of our proprietary technology platform, and the hard work and dedication of our teams around the world.”
Group net gaming revenue (NGR) increased 12 per cent during the period, with online delivering its 19th consecutive quarter of double-digit online growth with a 26 per cent rise. Online NGR in Australia, alone, showed a spectacular 64 per cent increase.
In the US, where the firm anticipates sports betting and iGaming will be worth approximately US$20.3bn (£15.7b/€17.3b) by 2025, GVC’s joint venture with MGM Resorts International, BetMGM, has launched in eight states, with three more expected to join by this year’s end.
Market share in US territories where BetMGM is operating is already running around 17 per cent.
In Q3 the company expanded its partner roster to embrace deals with American football teams the Denver Broncos, Detroit Lions and Las Vegas Raiders and Tennessee Titans.
With anticipated 2020 revenues of around US$160m (£124m/€136m) for the joint-venture, BetMGM is expecting to post a strategic loss of US$155m (£120m/€132m) for the year after debt has been paid down.
On the European front, across GVC’s 3,000-odd betting shops in the UK (Ladbrokes Coral, et al), performance was more muted – hardly surprising given the impact of coronavirus.
Revenue was down five per cent year-on-year, although GVC said its stores had opened as soon as the lock-down eased. Betting volumes had returned to within 10 per cent of pre-Covid-19 levels, the company said in a statement.
European retail, on the other hand, saw revenue rise 2 per cent from Q3 2019, aided by a strong performance in Italy; although recoveries in Belgium and the Republic of Ireland were slower.
Added GVC Chief Executive Segev: “While the risk of further restrictions as a result of COVID-19 mean that we remain cautious on the short-term outlook, in the longer term we are confident of being able to continue delivering sustainable growth for all our stakeholders.”