888 Holdings Lands "Milestone" US Expansion And Raises 2020 Outlook

(Alliance News) - 888 Holdings PLC on Wednesday said it has penned "multi-year market access ...

Alliance News 2 December, 2020 | 12:30PM
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(Alliance News) - 888 Holdings PLC on Wednesday said it has penned "multi-year market access agreements", including one with William Hill PLC suitor Caesars Entertainment Inc, doubling the number of US states in which it operates.

The pacts mean the gambling firm can launch in the US states of Colorado, Indiana and Iowa in 2021.

The online-focused bookmaker also raised its annual guidance, on the back of a "strong operational performance", boosted by a shift to digital gambling during a lockdown-hit 2020.

The company will initially launch its 888Sport brand in the three US states. The unit is focused on horse racing and sports betting, including its in-play offering.

"In Colorado, 888Sport will launch under the licence of the Colorado Grande Casino based in Cripple Creek. In Iowa, the group will launch under the licence of Catfish Bend Casinos II LLC," 888 explained.

In Indiana, 888 has inked an agreement with Caesars Entertainment's Hoosier Park to launch 888Sport in the state. Caesars reached an agreement to acquire UK gambling company William Hill for GBP2.9 billion back in September.

"These three agreements represent the latest milestones in 888's growth strategy in the developing US online gaming market and will increase the number of states where 888 has a presence to six," 888 added.

The company already has licences in New Jersey, Delaware and Nevada.

888 also briefly updated on its recent trading and gave a nod to regulatory measures in Germany which came into effect in October.

"888 has continued to deliver a strong operational performance during the second half of the financial year reflecting: the group's high levels of customer acquisition during 2019 and 2020; the benefit from the ongoing structural shift in consumer behaviour towards online services; significant new product roll-outs; and the group's increased vigilance on safe gambling and player protection," the company said.

As a result, 888's revenue and earnings before interest, tax, depreciation and amortisation will now top prior expectations.

"Revenue is expected to be approximately 45% ahead of 2019," 888 added.

The company posted revenue of USD560.3 million in 2019, meaning revenue in 2020 is set to top USD800 million.

The FTSE 250-listed online gaming entertainment provider posted a pretax profit in the six months ended June 30 of USD50.9 million, more than doubling from USD22.2 million a year prior.

Revenue was up 37% to USD379.1 million from USD277.3 million a year before.

"Considering the new gaming regulations that came into effect in Germany in October and the group's plans to increase levels of investment in the US market in the year ahead, the Board's expectations for 2021 remain unchanged," 888 added.

The 16 German federal states confirmed they had agreed plans to impose a transition-period tolerance policy, tightening gambling regulations in the country. The policies implement many parts of the Interstate Treaty, a legal framework governing gambling in Germany. The Interstate Treaty is penned to come into effect next summer.

888 shares rose 1.5% to 276.50 pence each in London on Wednesday afternoon.

By Eric Cunha; ericcunha@alliancenews.com

Copyright 2020 Alliance News Limited. All Rights Reserved.

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Securities Mentioned in Article

Security Name Price Change (%) Morningstar
Rating
888 Holdings PLC 172.40 GBX 2.86 -
William Hill PLC

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