GVC profits outperform market expectations

Post published:August 15, 2019
Post category:News / iGaming

Gambling giant GVC saw shares tick higher in early trading today after the Ladbrokes and Coral owner delighted investors with news of a better-than-anticipated performance at its betting shops.

The firm thinks its full-year profits will be £10million higher than previously expected after its retail business – consisting of several thousand high street bookies – ‘outperformed’.

That’s despite a recent Government clampdown on fixed odds betting terminals (FOBTs), which saw the maximum stake slashed from £100 to £2 in a bid to tackle problem gambling.

The stricter regulation, introduced in April, caused many UK bookmakers to fire the starting gun on widespread store closure plans.

Although the impact on GVC’s retail business was better than it feared, the company said it still expects to close around 900 stores over the next two years, putting 5,000 jobs at risk.

The FTSE 250 firm said that half-year comparable gaming revenue slid by 10 per cent and predicts the new rules will dent its annual earnings by £137.5million – but that’s £25million less than initially slated.

Our online operating model is proving highly effective, building on the sustainable competitive advantages of our wholly owned technology platform, leading product, cutting-edge marketing, leading brands and local execution, which are all delivered with an unrivalled understanding of the markets in which we operate.’

In the first half of its financial year, underlying profits jumped by nearly a third to £212million. But when factoring in £183million in one-off costs, its earnings almost evaporated.

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