The online gaming firm, 888 Holdings, experienced a decline in its share value following the publication of its mid-year financial statement. Despite an uptick in revenue within the UK market, profitability encountered a significant downturn.
The statement revealed a marginal 2% rise in revenue year-over-year, reaching $277.3 million. However, profit before tax experienced a steep 63% plunge to $22.2 million, negatively impacting 888’s stock performance.
Immediately after the financial figures were made public, the operator’s share price tumbled from £1.67 ($2.06) to £1.53. A slight recovery to approximately £1.57 was observed later in the day.
Although 888 witnessed a 7% growth in revenue from comparable avenues, with B2C revenue ascending by 6% to $262.5 million and casino revenue surging by 9% to $175.4 million, profits faced challenges.
Sports wagering revenue also demonstrated a robust 19% increase, reaching $44.5 million. Bingo revenue climbed by 17%, although when adjusted for currency fluctuations, it actually contracted by 3%.
Conversely, poker revenue experienced a 24% decline, settling at $23.1 million. B2B revenue witnessed a substantial 44% drop to $14.8 million.
Several elements influenced 888’s profitability, including the integration of Cashcade Bingo and the acquisitions of both the Costa Bingo brand and AAPN. The operator’s acquisition of BetBright for £15 million in March also impacted profits negatively, despite a 14% surge in UK revenue to $97.6 million.
Adjusted EBITDA contracted by 20% to $41.8 million, and adjusted profit before tax receded by 36% to $27.1 million. The previously mentioned pre-tax profit decrease was even more pronounced.
CEO Itai Pazner maintained a positive outlook, remarking: “888 achieved a solid operational performance throughout the initial six months of 2019.”
The company’s United Kingdom branch is recovering and branching out into fresh continental territories, such as Sweden and Portugal. This triumph is fueled by innovative offerings and a keen emphasis on the everyday consumer.
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