As it sees the benefits of a burgeoning betting and gaming market, and continues to plough ahead despite increasing headwinds.
888 is firing on all cylinders
The reopening of retail and leisure venues by competitors after lockdowns were eased has had an inevitable impact on revenues, where growth slowed in the months of July and August. Meanwhile, regulatory and compliance charges continue to weigh and the new regulatory regime in Germany is one to which the company needs to adjust.
In the near term, 888 is also battling against its own strong comparatives, with a particular challenge ahead in the fourth quarter, although the company remains optimistic on a favourable outcome for the year.
For the most part, however, 888 is firing on all cylinders.
Revenues for the period increased by 39% and pre-tax profit by 14%, underpinned by exceptional performances from Gaming and Betting, where revenues spiked by 35% and 82% respectively. By geography, growth was also strong in its core UK market, with an additional boost from Italy.
The strategic partnership with Sports Illustrated of the US is another example of the sector increasing its exposure to a potentially huge market, as restrictions on gaming are eased in any number of states. While US revenues currently account for just 12% of overall revenues, the potential is evident as the market is opened up, and there have been a number of partnerships between UK and US companies looking to benefit from the mutual advantages of technology platforms and a new generation of users.
Increasing marketing spend to raise general awareness of the company has also helped to propel revenues without a negative effect on the financials overall, as evidenced by an increase of 48% in net cash and an increased dividend showing confidence in prospects.
888 is well placed to build on its expertise, experience and technology platforms as it searches for further expansion possibilities. The share price has had a powerful run, having jumped by 105% over the last year, as compared to a rise of 37% for the wider FTSE250. Indeed, since the lows of the pandemic in March 2020 the price has added an extraordinary 475%, which has not been enough to dull the optimism of investors, with the market consensus of the shares as a strong buy remaining firmly in place.
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These views are those of the author alone and do not necessarily reflect the view of The Share Centre, its officers and employees.