888 Eyeing M&A Strategy After Posting Record Revenues
888 is considering mergers and acquisitions as part of its strategy for 2021. The online gambling operator has a $100m war chest after posting financial results, which showed a 52% rise in revenues.
While many parts of the gambling industry are struggling financially due to the coronavirus pandemic, online gambling operator 888 has posted financial results, which show a 52% surge in revenue in 2020.
Figures released by 888 show revenue totals of £608.3m, which has boosted cash reserves at the company by over £72m, which could be used to purchase existing companies as part of the operator’s strategy of organic growth combined with mergers and acquisitions.
End of year trading figures shows the London-listed operator achieved double-digit growth across all verticals except for its business-to-consumer bingo offering. Although this vertical did see an upturn of 9.9%.
The biggest surge in growth was 888’s business-to-consumer casino product. Returns of £424.82m is an uplift of 63% compared to 2019 figures. Poker generated £45.69m, which is an increase of 48% on the previous year.
Sports betting was also an important vertical for the company, with revenues of £88.39m, which are 36% higher than the 2019 numbers. This figure is likely to increase next year as sport betting opportunities were limited in 2020 due to the cancellation of several high profile events. Euro 2020 and the Olympics are just two events that have been postponed. The Euros have been moved to Friday June 11 until Sunday July 11, and the Olympics will now run from Friday July 23 until Sunday August 8, providing a windfall for their 888sport brand.
888 revenue separated by division:
- Casino-$586.8m, up 63.3% on 2019.
- Sport-$122.1m, up 35.7% on 2019.
- Poker-$63.1m, up 47.8% on 2019.
- Bingo-$42.3m, up 9.9% on 2019.
- Total consumer-$814.3m, up 18.9% on 2019.
- Business-to-business-$35.4m, up 18.9% on 2019.
- Group revenue-$849.7m, up 51.6% on 2019.
The company also released the revenue data for the different regions it operates in. These figures show that the UK is still an important market for the operator. The posted revenue figure of £241.44m is 63% higher than 2019. 888’s operations in Italy posted strong results. A revenue figure of $86.5 is 69% than the previous year.
The largest growth market was the United States. Although the revenue figure of $93.7m is modest compared to other regions, such as the UK, it does represent an increase of 81% on the previous year and an important market in the medium term.
On the results, 888 CEO Itai Pazner said: “2020 was a landmark year for 888, with our team navigating the many challenges presented by a global pandemic to deliver record financial results, and significant progress against our strategic priorities.
“Our product leadership strategy delivered outstanding results in 2020, with the launch of our groundbreaking Control Centre, our first ever in-house sportsbook and a totally new poker platform.
“We welcomed a record number of new members to our brands, nearly one and a half million, with our differentiated products and our big data supporting highly effective marketing.
We enter 2021 with strong momentum, with a record level of customers, and with a positive reaction to our suite of new products and innovations.– Itai Pazner, 888 CEO
In later interviews, Pazner said the company’s immediate plans are to continue realising organic growth in all verticals but highlighted sports betting and expanding US operations as a key focus. Stating:” Our plan in the US is a three-year plan. We want to launch in multiple states, to come up with our new infrastructure and to support the successful B2B deal that we have with Caesars.”