- GVC Holdings’ online vertical goes up 5% in terms of net profit
- More land-based shops may need to shut down
- Expansion ambitions in the United States seem promising
GVC Holdings has published its latest financial report, revealing a strong half year in digital and rather poor brick-and-mortar operations.
GVC Online Growth 5% Better YOY
GVC Holdings has posted a strong growth in its online gambling business during its latest financial half-year report covering the period that ended on June 30, 2019. The company reported a strong 5% growth year-over-year in terms of net gaming revenue. GVC managed to keep its results vibrant despite a dip in revenue back home in the United Kingdom, where tightening regulation has prompted several gaming companies to seek expansion overseas.
Without specific numbers revealed by GVC, the exact figures are subject to speculation, but what is known is the percentage increase throughout the period compared to the previous year. The total gaming revenue went up 17%.
Both online gaming and sports betting revenues went up by 17% and 18% respectively. Digital wagers soared by 13% year-over-year, marking yet another strong result. While GVC posted these numbers, the company also revealed that Ladbrokes and Coral’s brick and mortar operations have suffered a decline by 10%.
A hit to the land-based operations of UK sportsbooks isn’t a surprise. It has been occasioned by the changes in statures that came on April 1, 2019 and that changed the total betting limit from £100 down to £2. Meanwhile, GVC has shown support for multiple initiatives that while pertinent to gambling, have implications outside the industr:
London Calling and European Expansion for GVC
The United Kingdom has proved to be a tough market, biting into the revenue of all gaming businesses. The reduction of FOBTs’ limits has spread the news that major operators will be shutting down a substantial number of their land-based venue, in the case of William Hill, for example, that is 700 land-based shops, potentially letting go 4,500 employees.
At home GVC also had to make tough decisions and earlier in July, the company suggested that 900 of its UK-based betting shops would have to close. The tally of properties that would shut down could be much bigger. Yet, GVC is upbeat about its chances in the rest of Europe and the online segment. A similar sentiment was expressed by GVC CEO Kenny Alexander who pointed to the advantages the company has developed over the past months:
“This outperformance is driven by the sustainable competitive advantages of our proprietary technology platform, leading product, cutting edge marketing and leading brands, all delivered with an unrivalled understanding of the markets in which we operate. “
Shedding light on why GVC is restructuring its land-based business, Mr. Alexander explained that Ladbrokes Coral is the arm that is best-poised to consolidate its operations whereas the other brands could need to be scaled-down.
An Overture in the United States
GVC has done well in the United States, a market where the company is only beginning to expand into. GVC has participated in the creation of Roar Digital, a joint-venture with MGM Resorts that will launch on time for the NFL season, giving the company an opportunity to test its sports betting offer during one of the busiest time of the year.
GVC already has temporary permits for Mississippi and Nevada and Road Digital has been given the go-ahead to operate in New Jersey, although none of this is permanent as of now.