Friday 5 April 2019 8:02 am

Ladbrokes-owner GVC increases gambling revenue in first quarter

GVC said today that it had increased gambling revenue in the first quarter by eight per cent.

In a trading update, the Ladbrokes-owner said online net-gaming revenue (NGR) increased 17 per cent, which it said included strong volume growth in all territories.

Read more: GVC shares plunge as bosses offload majority of their holdings

UK retail revenue was flat while European retail revenue was up two per cent.

The company said the impact of the cut in the amount allowed to be staked on fixed odds betting terminals was not yet clear after its introduction on 1 April.

GVC said it is confident of meeting market expectations on profits for the financial year.

Read more: Ladbrokes owner GVC scores on World Cup betting splurge

Chief executive Kenneth Alexander said: "This trading update reflects a continuation of the strong trends reported on 5 March 2019, and represents an excellent start to the year. We continue to see good volume growth across all major online brands and territories and we remain very confident of achieving our target of double-digit online NGR growth.

“The impact of soft gross win margins in Italy and the UK was offset by improved margins in other territories, demonstrating the benefit of both geographic and product diversification across the group.

“In UK retail and European retail, improved sports wagering growth helped offset softer sports gross win margins. New B2 machines stakes restrictions were implemented in the UK on 1 April 2019 and we expect it to be several weeks before we can start to assess the impact. At this early stage of the year, the board is confident of delivering EBITDA and operating profit in-line with expectations."

George Salmon, equity analyst at Hargreaves Lansdown said: “It was only a brief first quarter trading update, but this announcement was important for GVC after market confidence was rocked by senior management dumping millions of shares last month. With the group still cantering towards its targets of double-digit online revenue growth, we think these numbers are generally reassuring.

"One blot on the copybook is that win margins are lower, meaning customers have had a comparatively good run recently. But the bookie always wins in the end. Punters often recycle a significant chunk of their winnings into another bet, and bookmakers can count on time taking its toll on a gambler’s roll. GVC will be hoping the tide turns over Grand National weekend, which is of course one of the most lucrative in the sporting calendar.“