UK-listed online casino operator 32Red had its best year ever in 2016 although its share of revenue from regulated markets dipped slightly.
Final FY16 results released on Thursday show 32Red’s revenue rising 28% to a record £62.3m, while earnings more than doubled to £10.6m and pre-tax profits jumped 511% to £6.5m. The gains reflect a full year’s contributions from online casino add-on Roxy Palace, a newly profitable performance by 32Red’s Italian business and the May 2016 launch of a more responsive multi-platform website.
32Red boosted its marketing investment by 26% last year, in part to promote its nascent sportsbook product. This investment included a three-year shirt sponsorship of Leeds United FC, an advertising deal with Sky TV’s live sports coverage and two racing sponsorships – the King George Winter Festival on Boxing Day and Haydock Park’s Group 1 Sprint Cup.
32Red CEO Ed Ware admitted it was fun to announce “another record annual performance,” which featured “outstanding growth on mobile.” Mobile’s share of overall revenue topped 57% last year, up from 44% in 2015.
Ware also celebrated the company “maintaining one of the highest levels of regulated revenue amongst our peers.” Despite Ware’s claims, 32Red’s share of revenue from regulated and taxed markets actually dipped three points last year to 77%.
The company has started 2017 on the same note it closed out 2016, with revenue over the first nine weeks of the year coming in one-fifth higher than the same period last year.
The numbers will be music to the ears of the Kindred Group, the parent company of multiple online gambling brands including Unibet, which struck a deal last month to acquire 32Red’s operations for £175.6m.
While 32Red’s directors continue to assert that they could have continued to grow their business in its core UK market as an independent entity, they also insist that 32Red “would now be better placed as part of a larger group” and that Kindred represents “a strong strategic and cultural fit for 32Red.”
