888 Holdings Announces First Quarter 2024 Trading Update
Published: April 21, 2024 | Author: Ron Clarke
888 Holdings, a prominent player in the online gambling industry, has released its trading update for the first quarter ending 31 March 2024. The company, which operates several high-profile gambling brands including 888casino, 888poker, and 888sport, has reported revenues exceeding its earlier forecasts, positioning itself for expected year-on-year growth starting from the second quarter of the year.
Financial Overview
The group reported a revenue of £431 million for the quarter, which is above the guidance range of £420-430 million provided after the full year 2023 results announced on 26 March 2024. This represents a 2% increase compared to the fourth quarter of 2023, indicating positive sequential growth. The company continues to anticipate a return to year-on-year revenue growth from the second quarter of 2024, with expectations to maintain a mid-term target of 5-9% annual growth.
The UK and Ireland online segment saw a 1% decline in revenues, despite a 9% increase in average monthly active users. This was mainly due to reduced sports revenues, which were affected by increased customer investments at the Cheltenham Festival. However, the company expects this segment to return to growth driven by strong customer engagement and new product introductions.
The international segment exhibited a positive trend with a 6% increase in revenues compared to the fourth quarter of 2023. This improvement came after fully integrating the effects of significant regulatory changes over the past year, which helped stabilize operations and contributed to a 4% revenue growth in key markets such as Italy, Spain, and Denmark.
The retail segment experienced a 7% decrease in revenue compared to the first quarter of 2023, influenced by a strategic reduction in the number of physical shops. This decline also reflects challenging comparisons due to particularly strong performance in the same period the previous year. Despite this year-on-year decline, revenue for the quarter remained steady when compared to the fourth quarter of 2023.
Strategic Initiatives
The announcement underscores 888 Holdings’ strategic adjustments and operational efficiencies aimed at securing long-term growth and stability in the competitive online gambling market. Last month, 888 outlined its Value Creation Plan (VCP), which includes ambitious revenue growth targets, margin improvements, and a focus on reducing debt levels. The company also announced a significant rebranding initiative, transitioning its corporate identity to evoke plc, which will be finalized pending shareholder approval in May 2024.
Furthermore, the company has concluded a strategic review of its US B2C operations, deciding to sell selected assets and shut down remaining operations within the year, subject to regulatory approvals. This move is expected to contribute an ongoing improvement in EBITDA of £25 million annually starting in 2025.
Moving Forward
888 Holdings’ CEO, Per Widerström, commented on the results, noting the company’s resilience in navigating regulatory changes and its strategic investments in marketing and product development. With these efforts, the company remains optimistic about achieving sustained growth in the upcoming quarters.
As the company moves forward with its rebranding and strategic realignments, industry observers will be watching closely to gauge the impact of these changes on its market position and financial health.
