Bwin reboot sees GVC revenues rise 9%

GVC Holdings has reported a 9% increase in full-year revenues and a 26% rise in EBITDA, as the enlarged firm continues the turnaround of its recently acquired bwin.party business.

Total pro-forma net gaming revenues (NGR) for the 12 months ended 31 December were €894.6m, which on a constant currency basis (cc) reflected an increase of 12% year-on-year.

Clean EBITDA was recorded at €205.7m, a rise of 26%, and the firm was keen to highlight it was on track to deliver the €125m of annual cost synergies highlighted when completing the transaction in February 2016.

The bulk of GVC’s revenue growth was delivered via the firm’s sportsbook brands, or Sports Labels, which saw NGR increase 14% (16%cc) to €653.9m.

Sports Labels, which includes brands such as bwin, Sportingbet and Betboo, posted a wager increase of 4% (7%cc) to €4.5bn, with margin up by 1pp to 9.6%, which the firm attributed to improved customer and risk management processes.

Gaming within the Sports Labels division enjoyed the biggest boost, with improved cross-sell and a larger portfolio of content producing an 18% (21%cc) rise in NGR to €320.8m.

The increase in Sports Labels was achieved with relatively low marketing investment, which the firm revealed was around 17% of NGR, although added this would be increased in 2017 to “normalised levels” of 23-25%.

Meanwhile, the operator’s Games Labels, which includes partypoker, partycasino, Foxy Bingo and Casino, and CasinoClub, declined 4% (0%cc) to €203.5m.

GVC chief executive Kenny Alexander said attempting to arrest the decline of the legacy bwin.party gaming brands had been the firm’s biggest challenge of the past 12 months.

The operator reported partypoker had delivered 14%cc growth, Games Labels NGR increased 4% in H2, and that revenues in 2017 to date were up 6% (8%cc) on a comparative basis.

Sportsbook NGR within the Games Labels grew 32% (35%cc) to €4.3m.

“The acquisition of bwin.party in February 2016 was our most ambitious transaction to date and through the hard work of our people we have once again demonstrated our ability to create significant shareholder value through selected acquisitions,” Alexander said.

“Our strategy of pursuing international diversification and scale through leveraging our proprietary technology, is more appropriate today than at any time in our history. The organic growth opportunity is equally exciting and we are confident of delivering further growth in 2017,” he added.

GVC’s share price had climbed 2.5% to 726.50p on the FTSE 250 at the time of writing.