The gaming segment of GVC Holdings has gained as a “partial substitution from sports products,” as the company views potential development across four strategic focal points as well as maintaining that it is ‘well placed to balance the year’ in its H1 review.
With the online reporting segment of the company seeing NGR rising 19 percent from £1.04bn to £1.24bn year-on-year, the boom in gaming results, a common phenomenon in the absence of Q2 sports activity, saw a 31 percent increase highlighted to £752.6 m from £574.6.
Total online EBITDA shot-up 53 percent to £368.6 million (2019: £241.3 million) boosted by favorable sport margins, good gaming results and reduced marketing expenditure due to sport cancellations.
Total group revenue for the reporting period dropped 11 percent to £1.58 billion (2019: £1.78 billion), gross profit fell 13 percent to £1.03 billion (2019: £1.18 billion), EBITDA fell five percent to £348.6 million (2019: £366.8 million) and profit after tax remained consistent at £ 2.1 million.
The closing of its betting shops at Ladbrokes and Coral resulted in a 53 percent decline in UK retail NGR from £586.8 m to £277.9 m, with the company’s European results falling 48 percent to £75.5 m (2019: £144.1 m).
GVC chief executive Shay Segev commented: “Given the unprecedented trading environment, GVC has delivered an encouraging performance in the first half, underlining the strength of our diversified business model and the expertise, adaptability and dedication of our people. These results show that we have a strong foundation.
“As a technologist, I have huge admiration for what Kenny and the rest of my colleagues have achieved but I am also determined to pursue a programme of continuous improvement as we focus on our four technology-enabled priorities. These are leading the US market, organic growth, expanding into new markets, and being the most responsible operator in our industry.
“Our industry-leading technology will enable us to grow responsibly and sustainably, using our data-driven customer insights to ensure all of our customers have an enjoyable and safe experience while gaming with us. That is how we will deliver greater and more sustainable value for all our stakeholders.“
In addition, GVC has also detailed the identification of a range of main goals to ensure sustainable development for the company, which it notes is “underpinned by operational competitive advantages.”
The four segments outlined are: give US market leadership, develop organically ahead of the markets it operates in, extend into new markets and become the industry’s most responsible operator.
With respect to the former, which saw GVC and MGM Resorts commit to a second tranche of investment in their Roar Digital joint venture last month, the business remains a crucial catalyst for the company to grow.
Estimating that the U.S. sports betting and online gaming industry will be worth about $20.3bn by 2025, GVC has taken its BetMGM JV live through seven of the 21 possible operating markets, with four more eye-catched by the end of the year.
In addition, GVC confirmed that, according to the current German online gambling legislation, it has applied for multiple sports betting licenses and ‘will fully expect its applications to be successful.’ Also recognized as important prospects for the growth of the betting community were Brazil and the Netherlands.