Despite an every changing U.K. regulatory environment, GVC is doing just fine. In their 2019 post-close trading update, the owner of Ladbrokes celebrates a year of growth and forward-looking optimism for what 2020 will bring.
For shareholders, the one thing that might matter most is that their results came in at the high end of expectations. GVC notes its earnings before interest, tax, amortization and depreciation (EBITDA) came in between £670 million to £680 million ($877 million to $890 million).
It’s not all positives, of course. Thanks to new regulations in the U.K. limiting the maximum stakes of fixed-odds betting terminals, retail net gaming revenue (NGR) suffered 12% year on year. That’s still less harm than was expected and a 13% increase in online revenue helped cushion the loss. Overall, the total NGR saw a 2% increase.
“The Group’s operational and financial performance in 2019 has been excellent with the strong momentum reported at Q3 continuing throughout Q4,” said Kenneth Alexander, CEO of the Group. “The performance continues to be driven by our industry-leading technology, products, brands, marketing capability, people and local execution, all of which is underpinned by our determination to spearhead the industry’s approach to responsible gaming.”
The optimistic outlook for 2020 lays squarely on the growing U.S. market, where GVC has already started working hard to be a big player. “As the Group continues to deliver the opportunities provided by both the Ladbrokes Coral integration and our sports betting joint-venture in the US, the Board is confident that the Group is well placed for a successful 2020,” added Alexander.
That joint venture with casino operator MGM Resorts recently signed an exclusive multi-year betting partnership with Yahoo Sports. Yahoo might not compete much with Google as a search engine, but they still have a fantastic presence in sports coverage, and will be a strong partner with GVC going forward.
If there’s any doubt to GVC’s optimisim, it’s in the ever changing U.K. landscape. 2019 was the year retail betting took a big hit, and 2020 could be the year online takes its lashes. We already know credit card betting will be gone by April. Now that other groups are calling out promotional practices used by the industry, and GVC and other operators have seemingly given up their exclusive streaming rights, 2020 might not be so rosy as the operator might have you believe.
