GVC raises FY guidance after strong Q3 online revenue growth
Gambling firm GVC Holdings upgraded full year profit forecasts as higher third quarter online revenues and over-the-counter betting offset a UK government crackdown on slot machines.
The Ladbrokes owner on Wednesday said it now expected earnings before interest, tax depreciation and amortisation to be in the range of £670m - £680m, up from £650m - £670m).
GVC added that like-for-like net gaming revenue(NGR) in the UK fell 18% after the government cut the maximum stake on fixed odds betting terminals to £2 from £100. Like-for-like machines NGR was 36% lower with a further 41 shops closed during the period, taking the total closed as a result of an internal review to 198.
The company expected to close a total of up to 900 shops across the next two years. However, it reported a 7% rise in over-the-counter bets as customers switched away from the terminals once referred to as the "crack cocaine" of gambling.
GVC added it had seen a good start in the US after the launch of its BetMGM mobile app in New Jersey. The two parties earlier this year entered into a joint-venture with hotel and casino operator MGM Resorts International .
The US has become the next great hope for gambling companies after a ban there on sports betting was lifted and the UK tightened regulation on the slot machines after complaints about user addiction.
In Germany the industry is waiting for a decision on new interim sports-betting licences. GVC said if clarity was not provided this year "then the likelihood of delays to the issuance of sports-betting licences in 2020 increases, and the probability of legal challenges impacting the interim licence roll-out is heightened".
"There is, therefore, a realistic possibility that the regulatory position will not be resolved until 2021, when positive re-regulation of the German online sports-betting and gaming market is expected," the company said.