5th Mar 2019 08:53
LONDON (Alliance News) - Gambling firm GVC Holdings PLC boosted its 2018 dividend Tuesday after underlying profit and revenue both jumped following its Ladbrokes Coral Group PLC acquisition, with further profit growth expected in 2019.
In 2018, pretax loss improved modestly to GBP18.9 million from GBP22.6 million the year prior. This was despite net gaming revenue more than tripled to GBP2.98 billion from GBP815.9 million the year before.
Revenue performance was helped by GVC's GBP3.2 billion acquisition of peer Ladbrokes Coral Group PLC in March 2018.
Profit performance was hurt by a sharp rise in exceptional administrative costs to GBP453.5 million from GBP173.6 million the year prior. This was primarily due to amortisation of acquired intangible assets equivalent to a GBP322.5 million charge and a further GBP186.8 million charge associated with a tax bill issued by the Greek authorities.
Underlying pretax profit - excluding one-off costs - pretax profit nearly tripled to GBP434.6 million from GBP151.0 million the year prior.
"The group's full year results reflect a very strong performance with proforma net gaming revenue 9% ahead of last year and proforma underlying Ebitda 13% ahead," GVC Chief Executive Officer Kenneth Alexander said.
Proforma underlying earnings before interest, taxes, depreciation and amortisation widened 13% to GBP755.3 million from GBP666.5 million the year prior. The underlying Ebitda figure for 2018 was slightly ahead of the GBP750.1 million forecast by analysts.
"2018 was a transformational year for the group with the completion of the Ladbrokes Coral acquisition in March making the group the largest online-led sports-betting and gaming operator in the world," Alexander added. "Excellent operational execution, effective marketing and a good World Cup helped both the legacy GVC and the acquired Ladbrokes Coral businesses perform ahead of expectations and materially ahead of the market, delivering market share gains in all our major territories."
"The GVC operating model leverages the group's leading proprietary technology and product development capability, applying central marketing expertise alongside local operational execution," Alexander said. "This model is proving highly effective."
GVC proposed a 16.0 pence per share second interim dividend, up 5.3% from 15.2p the year prior. For the full year, the dividend rose 16% to 32.0p from 27.7p the year before.
"Combined with the benefit of being a truly global scale operator, together with the opportunities provided by the integration of Ladbrokes Coral and our joint-venture in the US with MGM Resorts, the board is confident the group is well-placed to absorb the impact of the triennial review and associated tax increases in 2019, and deliver strong Ebitda growth in future years," Alexander continued.
Shares in GVC were up 0.1% lower at 651.50 pence on Tuesday.
Related Shares:
GVC.L