Q3 results 2020

Gamesys revenue grows 31% in strong third quarter

4 minutes read
Gamesys Group has credited another period of strong growth in Asia, coupled with European and US progress, as key revenue drivers in the third quarter of its fiscal year.

In a trading update for the three months to 30 September, revenue climbed 31% year-on-year to £190.0m, with trends seen in the first half of the year continuing into Q3. 

This meant double-digit growth in Asia, aided by the launch of Intercasino in Japan, its second brand to go live in the market.

In Great Britain, its performance was described as solid, aided by the growth of Rainbow Riches Casino, which launched in December 2019.

Spain, meanwhile, continued to make progress, aided by the ongoing growth of Monopoly Casino. Launched in June, Gamesys said it was proving “one of the most successful new brand initiatives in the history of the group”.

While the operator did not provide a full breakdown of third quarter performance, it reported double-digit top line growth in the US, again continuing the momentum of the first half. 

“We have performed extremely well during Q3, with strong organic revenue growth, an increasing active customer base, and solid progress made across both our core and growth markets globally,” Gamesys chief executive Lee Fenton said.

The performance of the first three quarters of 2020 looked set to continue into the fourth quarter, the operator added. While it was still early in the period, Gamesys said operations to date reflected the same trends as H1 and Q3. 

This came despite the business being largely restricted to remote working during Q3, with Gamesys taking a “cautious” approach to staff returning despite offices starting to reopen from their novel coronavirus (Covid-19) shut-down. It had in fact seen improvements in productivity from remote working in certain areas, such as code deployment. 

Its focus on wellbeing extended to customers, with an “unwavering” commitment to responsible gambling. Its dedicated team has seen its resource and capabilities expanded in 2020, allowing the operator to increase awareness of player time and spend across all sites, through a combination of human and automated monitoring.

“In addition to our intensified scrutiny of player activity, we also continue to remind players of the responsible gaming controls and self-help tools they can utilise,” it continued. 

Gamesys said it took an “extremely proactive” approach to interactions with players, particularly new customers. In Q3 this led to an increase in players setting deposit limits, to the point that one third of total monthly actives in Great Britain during the quarter set a deposit cap. 

Again, it highlighted the fact that its British sites have been used extensively for remote socialising – something also noted in H1 – with more than half of all sessions in the market not including wagering. 

This “serves to emphasise the recreational and fun environment we have created for our community of players to enjoy”, Gamesys said. 

Fenton added: “Despite the challenges of Covid-19, our workforce is providing seamless business continuity as most of them continue to function remotely in line with guidance. 

“We also remain focused on player protection, with an emphasis on proactive engagement and the promotion of responsible gambling tools.”

This responsible growth was underpinned by a sustainable approach to finances, with the group reducing its net debt to earnings before interest, tax, depreciation and amortisation (EBITDA) ratio from 2.27x in H1 to below 2.1x in Q3. This resulted in its cost of borrowing falling, and contributed to Gamesys’ inaugural dividend being paid to shareholders in October. 

“Our strong cashflows will continue to provide opportunities to deliver value to shareholders through investment in growth, a pay-down of debt, a progressive dividend policy and potential share buybacks,” the operator said.

The performance of the first three quarters of 2020 looked set to continue into the fourth quarter, the operator added. While it was still early in the period, Gamesys said operations to date reflected the same trends as H1 and Q3. 

“Looking ahead, our portfolio of established and trusted brands, complete ownership of our technology platforms and a strong balance sheet, underpin our ability to thrive in the long term,” Fenton said.

Image: Gamesys Group