GVC chief Alexander excited by Ladbrokes Coral potential as revenues rise
GVC Holdings, the company that acquired Ladbrokes Coral in a multi-billion-pound deal earlier this year, announced strong revenue growth in a trading update covering the first 20 weeks of 2018.
The international gambling group revealed double-digit growth in online sports and gaming, with net gaming revenues up 16 per cent on a pro forma basis compared to the same period in 2017.
Overall, online net gaming revenue increased 17 per cent, with total group revenue rising by seven per cent.
But the effect of so many racing fixtures being lost to adverse weather in the early part of the year was felt in the British retail division.
With 12 per cent of meetings cancelled, there was a five per cent drop in UK net gaming revenues within the Ladbrokes Coral betting shop estate, with over-the-counter net revenues also falling, by eight per cent.
The projected cost synergies of the Ladbrokes Coral acquisition were revised to £130 million by 2021, compared to the original projection of £100m at the time of the deal.
The completion of the government's triennial review earlier this month, with the maximum stakes for FOBTs limited to £2, means the acquisition of Ladbrokes Coral cost GVC Holdings £3.2bn.
Chief executive Kenny Alexander said: "It is very early days since the completion of the acquisition of the Ladbrokes Coral Group, but from what I have seen so far I am excited about the opportunities and even more confident of delivering shareholder value.
"The online operations continue to grow strongly and this is before we have started to implement in best practice across the enlarged group.
"Regulatory challenges across the industry cannot be ignored but through our scale, diversification, proprietary technology and people, GVC is very well placed to continue to succeed."
There is now the opportunity for GVC Holdings to expand into America, following the Supreme Court's decision to repeal the law which prohibits sports betting.
GVC already have a presence in the US, providing sportsbook and online casino technology, and the trading update noted that "the group continues to evaluate a number of potential opportunities to expand its presence in the US through a disciplined approach".
On Friday night, shares in GVC were up 43p at 1,026p, a 4.37 per cent increase.
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