Online gambling operator Jackpotjoy PLC managed to narrow its net losses in the first quarter of 2018, largely on the strength of its Vera&John online casino brand.
Figures released this week by the UK-listed Jackpotjoy show overall gaming revenue rising 13% to £80.7m, while adjusted earnings fell 7% to £27.1m. Adjusted net income improved 3% to £21.4m but the company booked an unadjusted net loss of £7.7m for the quarter.
Jackpotjoy blamed the adjusted earnings decrease on increased marketing expenses and the UK’s application of new taxes on online gambling bonus offers that took effect in Q4 2017. The adjusted net income gain was credited to the company having renegotiated its mammoth debt load during Q4 2017.
The Vera&John Nordic-facing online casino brand accounted for 26% of Q1’s group revenue but reported revenue growth of 35% in the quarter (31% in constant currency). The mainstay Jackpotjoy division, which includes the Mandalay and Botemania online bingo operations and the Starspins casino brand, reported revenue growth of 7%.
Average monthly active customers improved 7% to 256,700 at the end of March, while monthly gaming revenue per average active customer rose 9% to £95.
Jackpotjoy executive chairman Neil Goulden said Q1 displayed “a continuation in the good underlying momentum” the company enjoyed in 2017. The company hopes to build on that momentum by continuing its TV advertising campaign through Q2 and launching a new campaign in Spain.
The earnout period for the Botemania brand (as stipulated in the 2015 acquisition from former owner Gamesys) finished in March, and the company will make its final payment to Gamesys in June. Jackpotjoy says it will “comfortably” finance this payment from existing cash resources, after which it expects to “rapidly de-leverage.”
Jackpotjoy added that reducing its net debt “remains a key strategic target” for the company, although its adjusted net debt stood at £379.9m at the end of Q1, down only £7.4m from the total outstanding at the end of 2017.