GVC to increase dividend by half after continued “strong trading”
Operator's daily NGR climbs 12% in Q4 while 888 also updates the market
GVC Holdings will boost its January dividend payment by 49% to 12.5p per share, following a strong trading performance and “strong cash generation” in Q4.
The group reported a 12% rise in pro-forma daily net gaming revenues (NGR), compared to the same period last year, although did not give a specific monetary figure.
Daily NGR for Q4 2015 was €679,000 (£569,000) suggesting this year’s figure could be around £648,000 in constant currency.
Growth was particularly strong in sports with daily NGR up 19%, while gaming NGR was up 8% year-on-year.
“Momentum across the Group has continued to build throughout the year and is a reflection of the hard work of our employees, quality of our technology and strength of our brands,” said GVC chief executive Kenneth Alexander.
“The integration of bwin.party is proceeding positively and ahead of our original expectations. We continue to look forward to 2017 with confidence and expect to achieve further significant progress.”
The GVC Board also said it expects pro forma NGR and clean EBITDA for the year to be at the upper end of market expectations.
The trading update prompted a positive response from the market, with GVC shares up 4% to 640p at the time of writing.
The price marks a significant jump from a low of 611p earlier this week, after it emerged that a potential reverse takeover of Ladbrokes was dead in the water.
Simon French, an analyst at Cenkos, issued a Buy rating on the firm, adding: “The group enters the new year with encouraging momentum and identifiable earnings growth through synergy delivery. We strongly reiterate our Buy recommendation.”
Meanwhile, 888 Holdings also released a short update this morning in which it said trading remained strong.
“We have continued to make strong progress against our growth strategy by developing 888’s offering across regulated markets, investing in our proprietary platform and driving further growth in our core B2C business, led by Casino and Sport,” Itai Frieberger, 888 CEO, said.
“The strength of the Group’s performance during 2016 continues to be underpinned by 888’s core expertise in CRM, marketing and business analytics which is further supported by the effort and passion of our highly skilled team. These qualities mean that 888 remains well positioned for continued future growth,” he added.
888’s share price remained broadly flat at 206p.