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Gaming Realms Expects Earnings Growth In 2017, But Will Be Limited

LONDON (Alliance News) - Gaming Realms PLC on Wednesday reported a narrowed pretax loss in the ...

Alliance News 13 September, 2017 | 12:50PM
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LONDON (Alliance News) - Gaming Realms PLC on Wednesday reported a narrowed pretax loss in the first half of 2017 and said it expects to report earnings growth in the full year, but growth will be stinted by delays to third-party services and the earlier-than-expected timing of the new UK point of consumption tax.

Shares in Gaming Realms were trading down 7.5% to 7.75 pence on Wednesday following the announcement.

The mobile games creator said its pretax loss in the six months to the end of June narrowed to GBP4.1 million from GBP5.8 million in the first half of 2016, as it cut down costs by reducing marketing expenses and decreasing its headcount by 28 members of staff.

Revenue slipped to GBP15.7 million from GBP16.6 million, but like-for-like revenue, which excludes disposals, rose by 5%, which Gaming Realms said was a result of the "continued success" of its Grizzly mobile platform and Slingo games portfolio.

Gaming Realms' adjusted earnings before interest, tax, depreciation and amortisation loss narrowed to GBP900,000 from GBP3.1 million, and the company said it expects to be Ebitda positive for 2017 on the whole and "significantly" Ebitda positive in the second half.

It did say, however, that delays in third-party integrations of its remote game server to other operators will result in a reduction of its anticipated licensing revenue for the year, which, coupled with the earlier than previously forecast timing of the new point of consumption tax in the second half will mean Ebitda growth for 2017 is not as good as it had previously hoped.

"However, the board remains confident that profitable growth will continue and these are simply short-term timing issues," Gaming Realms said.

Real money gaming average daily revenue is up 11% so far in the third quarter year-on-year, the group added.

"The group has made significant progress towards profitability in the first half of 2017, with first-half losses reduced, the board anticipates that the group will be Ebitda positive for the year as a whole. Our strategy of focusing our resources and capital on real money gaming, whilst continuing to deliver content to other operators, is driving revenue growth. Additionally, our focus on synergies, cost management and reduction is driving improved profitability," Chief Executive Patrick Southon said.

"Further progress is expected in the second half of 2017 across the business with the RGS partnerships with Resorts Digital Gaming and Rush Street Interactive becoming fully operational, the first European partnership with BetVictor recently launched and our game portfolio expanded," he added.

By Karolina Kaminska; karolinakaminska@alliancenews.com; @KarolinaAllNews

Copyright 2017 Alliance News Limited. All Rights Reserved.

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Securities Mentioned in Article

Security Name Price Change (%) Morningstar
Rating
Gaming Realms PLC 6.90 GBX 2.22 -

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