Shares in on-line gambling company 888 Holdings (888) gained 3.3% to 421p after announcing record interim results and raising annual earnings guidance.
Pre-tax profits for the six months to the end of June, increased from $50.9 million to $57.9 million on a year on year basis as revenues increased by 39% to $528.4m. The interim dividend was increased by 41% to 4.5 cents per share.
LOCKDOWN BENEFICIARY
As with other on-line betting groups, 888 Holdings has been a key beneficiary of the extended lockdowns caused by the Covid crisis. A veritable plethora of live sporting events were cancelled due to the imposition of social distancing restrictions.
In response to this, many punters turned instead to the alternatives offered by on-line gambling firms including on-line poker and virtual casinos. A natural concern for the market and investors is to what extent growth levels can be sustained as the economy returns to some version of normality.
REASONS TO BE OPTIMISTIC
There are several reasons to be positive about the group’s future prospects, despite the tougher comparatives facing the company as the beneficial impact of lockdowns recedes.
First, the group is taking market share across key regulated markets. Second, the company will benefit from the strategic partnership in America with the upcoming launch of Sports Illustrated Sportsbook.
Sports Illustrated has over 12 million readers annually, over 30 million unique monthly visitors, and is the fastest growing sports media brand in America. Critically, according to research by Comscore the Sports Illustrated consumer is 78% more likely to wager and over 3 times as likely to visit a betting website.
