888 Holdings' 2015 operational profits halve due to levies but operational successes boost share price

 
Francesca Washtell
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The online gambling website of 888 holdi
888 Holdings saw successes across its European and US operations (Source: Getty)

The share price of online betting and gaming provider 888 Holdings rose as its announced its full-year financial results for 2015 today, emphasising operational successes despite a halving of its operational profit.

The figures

Operating profit for 888 Holdings, the owner of 888.com, halved from $80m (£55.5m) in 2014 to $40.8m (£28.3m) in 2015.

The company saw gaming duties rise to $50m (£35m) from $15.8m (£11m) in 2014, a 216 per cent increase that reflects a trend this results season of most betting companies seeing shortfalls due to newly-introduced online gambling levies. 888 registered profit before tax of $55.5m (£38.5m), a fall of 18 per cent from 2014.

The group's total revenue grew to $412.5m (£286m) from $390.8m (£270m) in 2014. The company's Emerging Offerings subsection increased by 38 per cent to $41.3m (£28.6m) and the Casino subsection grew 8 per cent to $238.7m (£165.6m). Poker and Bingo were both down six per cent.

However, the company also saw its aborted acquisition of bwin.party hit finances with net professional costs totalling $14.6m (£10.1m).

888 emphasised its operational successes on the release of the results, including a 13 per cent increase in active customers, a 37 per cent increase in active Casino players, maintaining the second place position in global poker liquidity ranking and the launch of its Multistate Poker Network in the US.

The company's share price jumped to a high of 187.00 points following the announcement, which had settled at a 2.48 per cent increase of 4.50 points to 186.00 by mid-morning.

888 Holdings 888 Holdings | mobile image

Why it's interesting

Earlier in March the company appointed Itai Frieberger new chief executive and Brian Mattingley as chairman. 888 Holdings platforms are trading at a strong level with average daily revenue in the first quarter 20 per cent higher than the corresponding period in 2015.

What 888 Holdings said

"2015 was a very successful year for 888, during which we maintained our excellent operational momentum. Like-for-like group revenue increased 12% driven by our core B2C business where we delivered an outstanding 13% increase in active players. This again reflected an exceptional performance in Casino and impressive growth in Sport, where we continue to see exciting opportunities on which to further capitalise in 2016," Itai Frieberfer, chief executive of 888, said.

"In line with our strategic focus, we made further progress across regulated markets with growth in Spain, aided by the launch of slots in the first half, Italy, where mobile continues to drive market penetration, and Denmark, where we have seen an encouraging performance following our successful launch in the second half of the year."

In short

Operational successes over 2015 have carried the company through the first year of heightened taxes and duties on the gambling sector, which have taken their toll on all firms across the industry.

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