A turbulent first half of 2017, has seen FTSE-listed online gambling group 888 Holdings declare pre-tax losses of $17.3 million (H1 2016: £21.5 million), with the company impacted by ‘exceptional costs’ of +$50 million recorded during the period.
Updating investors, 888 governance reported that the costs would offset a ‘record’ H1 performance for the company, as 888 recorded key metric growth and KPI gains across its product verticals.
The firm would record H1 2017 corporate revenues of $270 million, up 3% on corresponding H1 2016’s $262 million, driven by the strong performance of its B2C casino division within regulated markets.
The firm’s strong revenue performance would see 888 declare a period Adjusted EBITDA of $47.6 million representing a 8% increase on H1 2016: $44 million.
Nevertheless, 888’s growth would be impacted by exceptional charges of $50.8 million booked during the period, of which the gambling firm has prioritised $45 million to cover “potential past VAT matters” relating to the German market.
Adding to 888 earning woes, last week the UK Gambling Commission (UKGC) ordered the operator to pay a record £7.8 million fine relating to social responsibility failures relating to vulnerable customers.
In it H1 interim results, 888 governance detailed that it had set aside £4.2 million in preparation for its UKGC fine.
Closing a turbulent H1 2017 period Itai Frieberger, Chief Executive Officer of 888, commented on company performance
“888 has delivered further revenue growth and operational progress in the first half of 2017 resulting in a 9% increase in revenue at constant currency. This pleasing outcome was driven by continued growth in 888’s core Casino vertical, strong momentum in the fast-growing 888Sport and a good performance in Poker.
The Group’s strong strategic momentum continued as 888 developed its positions in regulated geographies, achieved greater diversification across products and markets and further enhanced operational efficiencies.
Our progress was driven by 888’s technology, leading CRM capabilities and cutting-edge marketing expertise. 888 is an agile business with an adaptable and entrepreneurial culture and team. Whilst the industry will continue to face regulatory headwinds in the second half of the year as further described below, trading in Q3 has started well and in line with the Board’s expectations. Underpinned by this momentum as well as the proven strengths of the Group’s business model the Board remains confident that 888 will achieve further progress and deliver its expectations for the full year.”