UK-listed online gambling operator 888 Holdings expects its 2020 financial performance to be better than originally anticipated, while announcing its imminent entry into three additional US sports betting states.
On Wednesday, 888 issued a brief update on its “strong” operational performance in the second half of 2020 to date. The company now expects its FY20 revenue to be 45% ahead of 2019’s total, during which revenue hit US$560.3m. The company’s FY earnings margin is expected to be unchanged from the first half of the year at around 18.5%.
Expectations for 888’s performance in 2021 remain unchanged, given Germany’s transition to a severely restricted online gambling market and expectations that 888’s rapidly expanding US operations will continue to require significant investment outlay. Regardless, investors liked what they heard, as the stock is currently up over 4% from Tuesday.
Speaking of the US, 888 also announced that it had secured ‘multi-year’ market access deals with three additional US states – Colorado, Indiana and Iowa – with sports betting launches expected in each state next year. None of these states have yet authorized online casino play, so the launches will be done via the 888Sport brand.
In Colorado, 888 has teamed up with the Colorado Grande Casino in Cripple Creek. In Iowa, 888’s local partner is Catfish Bend Casinos II LLC. In Indiana, 888 has leveraged its longstanding partnership with casino operator Caesars Entertainment to piggyback on the latter firm’s Harrah’s Hoosier Park venue.
888 offered no comment regarding CEO Itai Pazner’s September musings that the company might choose to bid on rival William Hill’s European online operations following the latter firm’s acquisition by Caesars Entertainment. Caesars has made no secret that the deal was entirely focused on Hills’ US sports betting operations, leaving the rest of Hills’ operations ripe for the plucking.
However, 888 recently appointed former Flutter Entertainment exec Vaughan Lewis as its chief strategy officer, a newly created role within 888. The company said at the time that Lewis would be tasked with strategic business development, including mergers & acquisitions origination and execution (although that may have more to do with 888’s search for a suitable US media partner to rival the Penn National Gaming/Barstool Sports tandem).
Among the other firms reportedly vying to snap up Hills’ non-US operations are 888 rivals GVC Holdings and US private equity group Apollo Global Management, which Caesars outbid for Hills as a whole.