19th Apr 2024 10:24
(Alliance News) - Investors were happy with 888 Holdings PLC on Friday, after it reported that first-quarter revenue topped expectations, ahead of a possible name change for the William Hill owner.
888 Holdings is a Gibraltar-headquartered sports betting and gambling company, which owns brands including 888casino and William Hill.
Its shares were up 2.8% to 82.00 pence each in London on Friday morning. Over the last 12 months, the stock is up 6.3%.
"When expectations are set low enough, sometimes it doesn't take a lot to beat them and that's proved to be the case at William Hill's owner, 888. Investors will be relieved to see revenue come in ahead of forecasts in the first quarter and should lap up the promise of a return to growth in the current quarter," said AJ Bell's Russ Mould.
The gambling firm said first quarter revenue topped guidance slightly, despite a small decline in the UK & Ireland online segment.
It reported first-quarter revenue of GBP431 million, down 3.2% on-year but ahead of the GBP420 million to GBP430 million it had predicted.
888 noted that revenue was up, however, by 2% from the fourth quarter of 2023. It explained that this reflects "a continuation of positive sequential quarter-on-quarter trends."
UK & Ireland online revenue alone fell 1% due to "reduced sports venues and increased customer investment across the Cheltenham Festival in comparison to last year", which a 4% growth in gaming could not offset.
For the UK & Ireland, 888 said that revenue is expected to return to on-year growth in the second quarter of 2023, "driven by strong customer engagement, new product launches, and the annualization of safer gambling changes."
888 also gave shareholders a strategy update on Friday.
The company, which had set out a "value creation plan" last month, said shareholders will get a vote on its possible name change to Evoke PLC at its annual general meeting in May.
It explained that the new name will better reflect its "one company" approach.
Sophie Lund-Yates at Hargreaves Lansdown said the company is "in the middle of a significant overhaul, with a newly minted management team, strategic plan and targets."
"Today's trading update should boost confidence that the turnaround has legs," Lund-Yates said.
"For all the positives, it's not all shipshape. Leverage remains eye wateringly high, and reducing that remains a priority. At the same time, the overarching risk for any gambling company is its ability to handle the regulatory environment."
Chief Executive Per Widerstrom said: "I was delighted to outline our multi-year value creation plan alongside our full year results in March, and am pleased to report a strong quarter of progress against these plans. We are moving decisively and at pace to position our company for long-term success, and I look forward to providing further updates about our progress in the coming months."
By Sophie Rose, Alliance News senior reporter
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