TIDMGVC
RNS Number : 4016E
GVC Holdings PLC
18 October 2018
18 October 2018
GVC Holdings PLC
("GVC", the "Group" or the "Company")
Q3 Trading update
GVC Holdings PLC (LSE: GVC), the multinational sports-betting
and gaming group, is pleased to announce a trading update for the
period 1 July 2018 to 30 September 2018.
Key highlights Q3(1) :
-- Continued strong growth and market share gains in all major territories
-- Online NGR +28%
o Sports brands NGR +31%
o Games brands NGR +19%
-- UK Retail like-for-like ("LFL")(2) NGR -2% helped by a good second half of the World Cup
-- European Retail NGR +24% with strong growth in Italy
-- Total Group NGR +14%
-- Integration of the Ladbrokes Coral businesses progressing well
Key highlights year-to-date(1) :
-- Group NGR +10% with Online NGR +21% and European Retail NGR +28%
-- The Group remains in-line with its expectations for the year
Q3 growth (1 July 2018 to YTD growth (1 January 2018
30 September 2018)(1) to 30 September 2018)(1)
Total Total Sports Sports Total Total Sports Sports
NGR NGR CC(3) Wagers Margin NGR NGR CC(3) Wagers Margin
------ ----------- -------- -------- ------ ----------- -------- --------
Online
Sports brands 31% 31% 16% +0.8pp 23% 24% 11% +1.1pp
Games brands 19% 18% 15% 16%
B2B 10% 8% 25% 27%
Total Online 28% 29% 21% 23%
UK Retail
(LFL(2) ) (2%) (2%) (4%) (0.2pp) (3%) (3%) (5%) (0.1pp)
European
Retail 24% 22% 18% +0.9pp 28% 24% 10% +2.4pp
Other 2% 2% (15%) (14%)
Total Group 14% 14% 10% 10%
Kenneth Alexander (CEO) said:
"The Group's performance in the quarter was very pleasing with
momentum continuing across the Online and European Retail
divisions. As highlighted in our H1 results, we will look to
consolidate our position in markets where we are taking market
share through the reinvestment of excess returns, and the board is
confident in its full year expectations. We believe our
sports-betting joint venture with MGM is best placed to be the
market leader in the US and we have taken the first steps on that
journey with the soft-launch of our sports-betting app in New
Jersey. We have also recently announced a series of CSR measures
including a multi-million pound commitment to responsible gambling
initiatives and a call for a pre-watershed ban of TV advertising in
the UK around football and other live sports.
The industry continues to evolve and whilst there are challenges
there are also many exciting opportunities. Through our proprietary
technology, portfolio of brands, leading product and talent, GVC is
well placed to continue to deliver shareholder value."
Q3 Trading commentary:
Online:
Online NGR was 28% ahead driven by strong growth across all
major territories and helped by a good end to the World Cup. After
adjusting for the estimated impact of the World Cup and the
acquisition of Crystalbet, Online NGR was 21% ahead.
Sports brands NGR grew 31%, with sports wagers 16% ahead and
sports margin up 0.8pp. Legacy GVC brands continued their strong
growth with NGR +43% driving significant market share gains across
our major territories; NGR was 30% ahead in Germany (+29% cc), +14%
ahead in Italy (+13% cc) and 13% ahead in Brazil (+39% cc), driven
by leading product, good customer user experience and innovative
brand marketing. The Crystalbet business continues to grow strongly
contributing 10pp to the legacy GVC sports brands NGR growth and
4pp to overall sports brands NGR growth. Growth in the acquired
Ladbrokes Coral brands was also strong; in the UK both
Ladbrokes.com +23% and Coral.co.uk +29% posted very pleasing NGR
growth with sports wagering 9% ahead, and sports margin +1.3pp
helped by a particularly strong margin in September. In Italy,
Eurobet.it NGR was 21% ahead (+19% cc) while in Australia,
Ladbrokes.com.au staking growth of 17% (+24% cc) was offset by a
softer margin (-0.7pp) resulting in NGR growth of 5% (+11% cc).
Games brands NGR was 19% ahead with partypoker +43% benefiting
from its extensive live event tournaments and continued marketing
investment. Gala brands NGR and GVC casino brands NGR were both
+18% driven in part by strong levels of first-time-depositors.
UK Retail (LFL(2) ):
UK Retail LFL NGR was 2% behind last year. LFL OTC wagers were
4% behind, and after adjusting for the World Cup, were around 6%
behind, while OTC gross win margin was 0.2pp behind last year.
Machines LFL NGR was 1% ahead.
European Retail:
European Retail NGR was 24% ahead of last year (+22% cc) with
growth in all regions. Eurobet Retail NGR was 33% (+31% cc) ahead
of last year helped by the World Cup (contributing 6pp of growth)
and by good underlying wagering growth of 17% (+15% cc) excluding
the World Cup.
US:
During the quarter the joint venture between GVC and MGM Resorts
soft-launched its New Jersey Android mobile app. The launch of an
iOS version is imminent (and is currently awaiting Apple Store
approval). Upon iOS launch, a full "playMGM" marketing campaign
will commence.
The joint venture has also signed a market access agreement with
the United Auburn Indian Community which in the event that
California legislates sports-betting, will enable the joint-venture
to access the Californian market with its brands.
Triennial Review:
We expect the Government to provide an update on its plans to
increase Remote Gaming Duty in the Budget on 29 October 2018. We
also expect clarity on the implementation date for the cut in B2
stakes to GBP2. We anticipate that the Triennial Review legislation
will be enacted this year.
CFO succession planning:
The Group has today announced that Rob Wood has been appointed
Deputy Chief Financial Officer with immediate effect, prior to
succeeding Paul Bowtell as GVC's Chief Financial Officer ("CFO")
following his decision to step down from the Board on 5 March
2019.
After seven years as CFO of first Gala Coral, then Ladbrokes
Coral plc and now GVC, Paul Bowtell has decided to leave the
Company in order to take up a role with Alchemy Partners, the
private equity firm. He will step down on 5 March 2019, when GVC
expects to announce its 2018 annual results. Rob Wood has been with
the Group for six years and is the CFO of the Ladbrokes Coral UK
Retail business, the largest division in GVC.
Notes
(1) The Group's proforma results are presented as if the current
Group, post the acquisition of the Ladbrokes Coral Group plc, had
existed since 1 January 2017. As such, it excludes the results of
the Turkish business which was discontinued during 2017 and the 360
shops that the Ladbrokes Coral Group plc was required to divest on
the merger of Ladbrokes PLC and the Coral Group. The results of
Crystalbet are included from the date of acquisition (11 April
2018) and the results of Kalixa are excluded from the date of
disposal (31 May 2017)
(2) UK Retail numbers are quoted on a LFL basis. During the
period there were an average of 3,495 shops in the estate, compared
to an average of 3,581 in the same period last year
(3) Growth on a constant currency basis is calculated by
translating both current and prior year performance at the 2018
exchange rates
- ends -
LEI: 213800GNI3K45LQR8L28
Call Details:
GVC will host a conference call on 18 October 2018 at 8.30 am
(London time). Participants may join the call by dialing one of the
following numbers, approximately 10 minutes before the start of the
call.
UK toll-free dial in: 08082370040
International numbers:
http://events.arkadin.com/ev/docs/FEL_Events_International_Access_List.pdf
Participant PIN Code: 48892211#
Enquiries:
GVC Holdings PLC
Kenneth Alexander, Chief Executive Officer
Paul Bowtell, Chief Financial Officer
Nick Batram, Director of Investor Relations & External Communications
Paul Tymms, Head of Investor Relations (investors@gvc-plc.com)
Media enquiries:
Buchanan Communications
David Rydell/Henry Harrison-Topham/Chris Lane Tel: +44 (0) 20 7466 5066
Forward looking statements:
This announcement contains certain statements that are
forward-looking statements. They appear in a number of places
throughout this announcement and include statements regarding our
intentions, beliefs or current expectations and those of our
officers, directors and employees concerning, amongst other things,
our results of operations, financial condition, liquidity,
prospects, growth, strategies and the business we operate. By their
nature, these statements involve uncertainty since future events
and circumstances can cause results and developments to differ
materially from those anticipated. The forward-looking statements
reflect knowledge and information available at the date of
preparation of this announcement and, unless otherwise required by
applicable law, the Company undertakes no obligation to update or
revise these forward-looking statements. Nothing in this
announcement should be construed as a profit forecast. The Company
and its directors accept no liability to third parties in respect
of this document save as would arise under English law.
About GVC Holdings PLC:
GVC Holdings PLC is one of the world's largest sports-betting
and gaming groups, operating both online and in the retail sector.
The Group owns a comprehensive portfolio of established brands;
Sports Brands include bwin, Coral, Crystalbet, Eurobet, Ladbrokes
and Sportingbet; Games Brands include CasinoClub, Foxy Bingo, Gala,
Gioco Digitale, partypoker and PartyCasino. The Group owns
proprietary technology across all of its core product verticals and
in addition to its B2C operations provides services to a number of
third-party customers on a B2B basis. GVC acquired Ladbrokes Coral
Group plc on 28 March 2018 and is now the UK's largest high street
bookmaker, with over 3,500 betting shops. The Group, incorporated
in the Isle of Man, is a constituent of the FTSE 100 index and has
licences in more than 20 countries, across five continents.
For more information see the Group's website:
www.gvc-plc.com
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END
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