Ladbrokes owner first-half profit dips but outlook upbeat on online betting surge
By Pushkala Aripaka
(Reuters) - Ladbrokes and bwin brand owner GVC <GVC.L> reported lower first-half core profit on Thursday, while forecasting growth for the rest of the year as its online betting business flourishes and the company looks to cash in on a growing U.S. market.
Betting shop closures and sport events cancellations during the COVID-19 lockdowns hurt overall revenue, but GVC's online sales jumped nearly 20%, with growth in both sports and gaming categories and double-digit growth across major markets.
It now expects full-year underlying core profit to be between 720 million pounds and 740 million pounds, down from 761 million it reported last year, but above a company supplied consensus estimate of 715 million pounds.
The company also scrapped its interim dividend and its shares fell almost 1% to 778 pence by 0813 GMT, having risen as much as 3% earlier in the day.
Online profits surged 53% to 368.6 million pounds, while in Britain like-for-like sales halved on government-mandated restrictions.
"Given the unprecedented trading environment, GVC has delivered an encouraging performance in the first half, underlining the strength of our diversified business model," new Chief Executive Shay Segev said.
Segev took over from long-time CEO Kenny Alexander in July and the results bode well for him and the company as it shifts strategies.
British bookmakers, including GVC and peer William Hill <WMH.L> have been expanding into the U.S. market to offset a hit from tighter regulations at home.
GVC, which has a U.S. presence through a venture with casino operator MGM Resorts <MGM.N>, on Thursday said the United States represented the "single biggest growth opportunity for GVC".
Underlying earnings before interest, taxes, depreciation and amortization for the six months to June slipped 5% to 348.6 million pounds on a reported basis.
However, sporting events, such as horse-racing, Britain's Premier League and Germany's Bundesliga and Major League Baseball, resumed in recent weeks, aiding bookmakers.
(Reporting by Pushkala Aripaka and Yadarisa Shabong in Bengaluru; Editing by Amy Caren Daniel, Patrick Graham and Emelia Sithole-Matarise)
