Revenue Totals Slip at 888, but Don't Let Appearances Fool YouPublished March 21, 2019 by Lee R
Gaps in 888's UK growth for 2018 look like they will be filled substantially with major new deals in the US market.
UK gaming giant 888 Holdings has reports a 2 percent year-on-year decline in revenue due to a more substantial drop from its core UK market, but things are about to change.
The revenue total of US$529.9m in 2018, with several figures shaping that drop.
The key B2C total revenue was commensurately down, 2 per cent to $479.3m. While 888 showed growth in some regulated markets across Continental Europe, that progress was ultimately stymied by closures in big markets in Australia and the Czech Republic, along a 16 per cent decline in revenue from the UK for 2018.
Poker, Bingo Issues
B2C poker experienced a 37% full year revenue drop in the wake of stiffening competition. The main dents in poker revenues of $49m came from withdrawals in Poland and Australia, and an 8% decline in active players.
The firm’s bingo division's 17 percent decline was attributed to increased regulatory scrutiny in the UK.
EBITDA and Profits Up
The news was certainly not all bad, with 888 showing steady increases of 11 percent in adjusted profit before tax to $86.7m (£65.6m); and six percent increase in adjusted earnings before interest, tax, depreciation and amortisation to $107.1m.
Dividends Close Up
888 ultimately managed a final dividend of 6 cents per share, a shade up from last year's 5.9 cents.
The lull in yearly revenues should ultimately be taken with a grain of salt accompanying a period of aggressive expansion as 888 seeks to has been going through en route to establish a hold in the US market.
US Market Holds
Positioning measures include 888's December buyout of the remaining half of All American Poker Network for $28.5m; the launching of 888 Sport in New Jersey; and the first sponsorship foray into American football with the NFL's New York Jets.
888 Boss Speaks
In his first report as chief executive, Chief executive Itai Pazner of 888 said his organisation's expansion was driven by “obtaining important new licenses; launch(ing) our most significant product innovation in recent years in the form of (new casino platform) Orbit; and...three acquisitions including delivering on our long-stated ambition to add proprietary sports betting technology to 888.”
Of the financials for the year, Pazner called 2018 overall “resilient” due to “record earnings before interest, tax, depreciation and amortisation outcome for the year,” while attributing growth across regulated markets in Europe to “good momentum” in 888 verticals casino and sport.
The bold new entries into America look like 888 has positioned itself for a substantial and uncapped boost in growth that could render any hiccups from 2018 a distant memory in next year's totals.