Year-on-year increase in revenue
GVC Holdings, owner of Ladbrokes Coral and bwin.party, expects core annual earnings for 2019 to be at the top end of forecasts, largely due to greater demand for its online gambling products.
GVC enjoyed an “excellent” trading performance in 2019. A key factor was the 12% increase in online revenue. Sports betting operations also performed particularly well, highlighted by a 16% increase in NGR.
expected to be between £670m ($874m) and £680m ($887m)
Net gaming revenue (NGR) for the twelve months ending December 31, 2019 is expected to increase by 2% compared to 2018. Forecasted core earnings for the most recent financial year are expected to be between £670m ($874m) and £680m ($887m). These figures are before tax and interest.
Reaction to regulatory pressure
GVC’s retail sales in the UK declined by 11% in the fourth quarter of 2019 when compared to results posted for the same period in 2018. A decline of 12% has been reported for the full financial year.
This was mainly due to the max stake for fixed-odds betting terminals (FOBTs) being slashed from a previous high of £100 ($130) to £2 ($2.61).
GVC will experience further regulatory pressure going forward. The UK Gambling Commission (UKGC) announced this week that the 24 million people gambling in the region would no longer be able to use credit cards when depositing funds to online gambling accounts. This ban comes into effect in April 2020.
Expansion into new markets
GVC has expanded into overseas markets in recent times. The company has positioned itself strongly in US markets, where more and more states are legalizing sports betting.
One of GVC’s major plays in the United States is its joint venture with MGM Resorts International. According to GVC, this joint venture made “good progress” in the most recent finncial quarter.
less regulatory pressures than in the UK, making it easier for GVC’s brands to operate more freely
Other nations also have less regulatory pressures than in the UK, making it easier for GVC’s brands to operate more freely. Total revenue generated by the group’s European operations was up 5% for the year.
Looking forward, Kenneth Alexander, chief executive officer of GVC, said: “As the group continues to deliver the opportunities provided by both the Ladbrokes Coral integration and our sports betting joint venture in the US, the board is confident that the group is well placed for a successful 2020.”