888 nets 5x profit jump ahead of critical B2C portfolio enlargement 

888 Holdings has branded 2021 as a year of ‘strategic progress’, in which the company has realised its transformative objective to become a global leader in online betting and gaming. 

Full-year 2021 trading saw 888 register record group revenues of $980 million, up 15% on corresponding FY2020 results of $850 million.

Headline growth was achieved despite 888 countering “$70-100 million regulatory-related revenue headwinds” related to Q4 German market adjustment and UK safer gambling measures.

Accounting for 86% of corporate revenues, 888’s flagship Gaming B2C unit. registered a 17% increase in revenues to $814 million (FY2020: $693m) – as the unit achieved continued growth in the ‘core markets’ of the UK, Spain and Italy (+18%). 

“2021 was another record year for 888, as we delivered mid-teens revenue growth and continued to execute against our core growth strategy,” cited Group CEO Itai Pazner.

“We delivered record revenues of $980m, with 74% derived from locally regulated and taxed markets as we continued to see market share gains in our key markets.” 

Core market growth helped 888 generate $647 million of gross profits from operations, up 15% on FY2020 results of $562 million.

Group-wide expenses for FY2021 totalled $482 million (FY2020: $407), attributed to higher marketing costs of $306 million and total operating expenditure of $175 million.

Higher operating costs combined with the significant investment in US SI Sportsbook venture, saw 888 declare an adjusted EBITDA of $165 million, up 6% on FY 2020 results of $156 million.

Improved bottom-line results saw 888 declare a 5x jump in profits after tax to $69 million, matched against FY2020 profits of $11 million, in which the company had been dragged by an impairment charge of $80 million.

Pazner outlined: “Our focus on growth in regulated markets continued, with locally regulated or taxed revenues reaching 74% of our total (up from 73%).

“Our core markets (UK; Italy; and Spain) saw revenues grow by 18% in the year despite the very strong comparative period, and we believe that we continue to hold or take market share.

“This is more important than ever in Italy and Spain, where marketing restrictions mean we must compete on product and leverage our established brand presence.

“As the UK Gambling Act also considers marketing restrictions, we must continue to focus on establishing our brand, and ensuring we continue to offer best in class products and customer experiences.”

Entering 2022, 888 looks forward to a further transformative year for its business. The FTSE250 firm will significantly expand in the UK integrating the assets of William Hill and grow its Nordic market-share through the integration of  Mr Green as a new brand.

Of note, during 2022 888 will significantly bolster its B2C capacity, having finalised its $50 million to sell  its B2B Dragonfish bingo network to Broadway Gaming.

“We have made strong progress in our plans to integrate William Hill and, as we move into 2022, we are excited about the opportunities ahead of us, particularly as we significantly expand the management capabilities of the enlarged group. We have significant confidence in our integration plans and the delivery of substantial synergies, creating a powerful, scalable global business.” Pazner concluded.

“We are excited about the growth potential of the enlarged business, which would benefit from a global, scalable technology stack, that delivers world-class betting and gaming products into high structural growth markets across a range of iconic and market-leading brands.”

 

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