Stricter regulation has made some UK-based gambling groups a riskier bet, and it's safe to say 888 Holdings (888) isn't immune. Chief executive Itai Frieberger called the UK a "challenging market" as scrutiny from regulators intensifies, and as UK sales fell 18 per cent to $86.5m (£65.9m) during the first half. As a result, 888 is now investing more in what it calls "higher growth" markets. Strip out the UK, and group revenue increased by nearly a third over the period, while group sales post period-end are down 4 per cent, albeit up 6 per cent excluding the UK.
But 888 investors still have reason to cheer. Regulated markets in continental Europe, including Spain and Italy, increased sales by 28 per cent, with strong performance across sport, casino and bingo. 888 also has ambitions to expand into the US after legislation banning sports betting was overturned in May. The company already has a presence in the three states where gambling is allowed, and management is hoping to leverage existing partnerships into new states.
Analysts at Numis expect earnings per share (EPS) of 21.2ȼ during 2018, compared with 20.1ȼ in 2017.
| 888 HOLDINGS (888) | ||||
| ORD PRICE: | 209p | MARKET VALUE: | £ 762m | |
| TOUCH: | 209-209.6p | 12-MONTH HIGH: | 327p | LOW: 203p |
| DIVIDEND YIELD: | 5.7% | PE RATIO: | 11 | |
| NET ASSET VALUE: | 36ȼ* | NET CASH: | $16.1m | |
| Half-year to 30 Jun | Turnover ($m) | Pre-tax profit ($m) | Earnings per share (ȼ) | Dividend per share (ȼ) |
| 2017 | 270 | -17.3 | -5.0 | 4.0 |
| 2018 | 284 | 60.1 | 15.4 | 4.2 |
| % change | +5 | - | - | +5 |
| Ex-div: | 04 Oct | |||
| Payment: | 31 Oct | |||
| *Includes intangible assets of $160m, or 44ȼ per share £1=$1.31 | ||||
