GVC boosted by £30m ‘synergies’
GVC Holdings revealed today (Thursday) an unexpected £30m (€34m/$39m) financial boost as a result of the takeover of Ladbrokes Coral Group earlier this year, with the company’s online performance and European retail operations helping to lift its half-yearly financial figures.
GVC had already set out anticipated cost synergies of £130m in relation to the Ladbrokes Coral acquisition, which was finalised at the end of March.
However, it said in today’s trading update that a further £30m in capital expenditure synergies relating to Ladbrokes Coral had been identified.
GVC’s proforma results – which for like-for-like purposes showed what the group’s performance would have been if the current structure, including Ladbrokes Coral, had been in place since the start of 2017 – revealed an 8% rise in net gaming revenue to £1.72bn.
Gross profit was also up by 6% to £1.16bn, while the firm’s underlying earnings before interest and deductions improved by 11% to £314.1m and underlying profit rocketed by 17% to £277.9m.
Kenneth Alexander (pictured), chief executive of GVC, said: “The performance of the GVC Group in the first half has been extremely pleasing in what has been a very busy period.
“Strong momentum in online and European retail has continued, and a positive World Cup helped improve trends in UK Retail in the second quarter.
“The acquisition of Ladbrokes Coral completed on March 28 and the integration of that business is progressing well. We have now identified capex synergies of at least £30m in addition to the £130m cost synergies and we are well placed to deliver those savings while driving top line growth.
“We are gaining market share in all our key markets and we will look to reinvest to further strengthen our market position.”
Alexander also said that the US Supreme Court’s decision to overturn a federal ban on sports betting in May had carved out new market openings for the company.
“The repeal of PASPA by the US Supreme Court in May provides a significant new market opportunity and we are delighted to have announced a joint venture with MGM Resorts to provide sports-betting and online gaming services in the US,” he added.
“The combination of MGM’s leading brands together with GVC’s proprietary technology, and both businesses’ combined betting and gaming expertise, puts the group in the best possible position to benefit from what could become the world’s largest regulated sports betting market.”
Image: GVC