888 hails ongoing growth in regulated markets as Q3 revenue rises 7%
In a trading update, 888 said total revenue for the three months to 30 September amounted to £229.9m (€271.7m/$316.7m), up 7% from £215.6m in the same period last year.
B2C revenue was 7% higher at £220.3m, with B2C gaming by far the main source of income after generating £193.5m in the third quarter, up 11% year-on-year. The operator said this growth was led by its online casino offering, which was expanded in Q3 with the addition of more than 150 new games.
While B2C betting revenue fell 15% to £26.8m, 888 said this was down to what it described as a “very strong” comparable performance in Q3 last year, during which it benefitted from a condensed calendar of sporting events following disruption to the sports calendar earlier in 2020 due to the novel coronavirus (Covid-19) pandemic.
B2C betting revenue was up 21% when compared with Q3 levels in 2019.
Turning to B2B, revenue was 4% higher at £9.6m, with 888 reporting “moderate growth” across its bingo and US operational segments. Q3 also saw the launch of the World Series of Poker (WSOP) brand in Pennsylvania via a partnership with Caesars Interactive, with this set to be expanded to Michigan in the coming weeks.
Other business activity in Q3 included the roll out of a new sportsbook in Colorado, together with sports magazine Sports Illustrated, as well as a launch in the regulated German market under a newly issued sport licence.
In addition, September saw 888 agree a deal worth £2.2bn to acquire William Hill’s non-US assets from Caesars Entertainment. 888 said the deal would significantly enhance the enlarged group’s scale and create leading positions in several key regulated markets.
“Q3 2021 was a period of outstanding strategic progress for 888,” 888 chief executive Itai Pazner said. “During the period we announced the transformational acquisition of William Hill International, successfully launched SI Sportsbook in the US, and began operating 888sport under a new licence in Germany as we continued to execute our plan to build a global online betting and gaming leader.
“Alongside these important strategic milestones, I am pleased with the group’s continued positive trading, particularly as we lap very tough comparative periods.
“This performance reflects the continued success of our data-driven investments and execution against our product-leadership plan that delivers ongoing improvements in the usability, quality and safety of our sports betting and gaming products.”
For the year to date, revenue in the nine months to the end of September was 28% higher at £758.3m.
B2C revenue hiked 28% to £729.4m, with B2C gaming revenue up 27% to £622.3m and B2C betting revenue 41% higher at £107.1m. B1B revenue was also up by 7% to £28.9m.
888 said the group’s performance was in line with the board’s expectations and is currently on track to reach full-year targets, despite its decision to halt operations in the Netherlands.
On 1 October, the Netherlands opened its regulated market, with only 10 operators having been issued licences, with 888 not among those to be licensed, As such, 888 said it would block Dutch players until it secured a licence in the country.
While 888 said the timing of any licence award in the Netherlands remains unclear, it aims to be operational in the country during the second half of 2022.
The operator added that the temporary closure is expected to negatively impact its 2022 EBITDA – post certain mitigations at group level – by approximately $10m, with no change in the group’s expectations for 2023 and beyond.
“Underpinned by our advanced technology, leading products, and strong brands, as well as the increased scale, talent and diversification that the group will benefit from as a result of its combination with William Hill International, we have a very exciting platform for long-term growth,” Pazner added.