Despite an “inevitable disruption” to the global sports industry, the Stars Group is optimistic to produce sales growth in the time ahead, as the organisation issues an update on its year-to-date results in the face of the global coronavirus outbreak.
Commenting on the difficulty of forecasting the scale, pace, and duration of the current sport postponements and cancellations, the group assets trust due to its online only global demographic reach that sees 62 percent of revenue generated from its poker and gaming divisions.
As of 31 December 2019, The Stars Group said it had $321 m in cash and cash equivalents, and subsequently prepaid $100 m of its first lien term loan in February. The Stars Group also has access to its revolving credit facility, among other possible sources of liquidity, which along with its existing cash and cash equivalents provide around $1bn of liquidity.
Rafi Ashkenazi, CEO of The Stars Group explained: “We are pleased with the performance of our business so far this year, which has seen continued strong underlying momentum within our UK and Australia segments, and a sequential improvement in our international segment from the fourth quarter of 2019.”
“Overall, we are so far performing ahead of our expectations and currently expect to see strong year over year growth in revenues for the first quarter.”
Performance in the company’s international segment for 2020 is reported to be marginally ahead of the previous year, with its UK division continuing to experience solid structural patterns alongside operator-friendly sporting results, contributing to good revenue growth year-over-year.
Ashkenazi further added: “Outside of our strong performance so far this year, the recent outbreak of the coronavirus pandemic has resulted in the cancellation or postponement of major sporting events globally.
“We are closely monitoring the continued impact of the coronavirus, and the health and safety of our employees and customers remains our top priority, as we implement our business continuity plans and continue to observe and comply with local mandates and guidelines across our global offices.
“Our employees are working remotely to ensure that our customers can continue to enjoy our products, and while we currently still offer a broad range of betting options for our customers, any sustained outbreak resulting in the further postponement or cancellation of major sporting events could have a material impact on our sports betting revenue in the near term.”