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MarketScreener Homepage  >  Equities  >  London Stock Exchange  >  GVC Holdings PLC    GVC   IM00B5VQMV65

GVC HOLDINGS PLC

(GVC)
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Gambling companies reel as coronavirus means most sports bets are off

03/16/2020 | 11:09am EST

The owners of gambling brands Paddy Power, Betfair, Ladbrokes and William Hill warned on Monday of a big hit to earnings because of an unprecedented shutdown of global sports events caused by the coronavirus, hammering shares across the sector.

Flutter Entertainment Plc, which operates the Paddy Power and Betfair brands, estimated that it would face a 90 to 110 million pound impact on full-year earnings if curbs on sports fixtures remained in place until the end of August.

That figure was based on horse racing continuing but only behind closed doors, as is the plan in Britain.

GVC Holdings Plc, owners of the Ladbrokes betting shop chain, said its full-year core earnings may be reduced by 130-150 million pounds because of fewer sports fixtures.

That calculation was based on the soccer season remaining on hold until July, the Euro 2020 tournament being delayed for a year, and major horse racing meetings such as Aintree and Royal Ascot being cancelled.

William Hill suspended its dividend and warned of an impact of 100-110 million pounds on core earnings if its British high street shops had to close for a month and most sports events remained suspended until August.

Shares in William Hill plunged 34%, GVC lost 20% while Flutter's London-listed shares fell 12%.

BETTING ON DOGS, E-SPORTS

Flutter generated around 78% of its revenue through bets placed on global sporting events last year.

Sports accounted for 53% of William Hill's revenue in 2019, while GVC generates around 45% of its core revenue from sporting events.

Major sports events suspended or cancelled due to the virus include elite soccer competitions such as the English Premier League, Spain's la Liga, Germany's Bundesliga and the Champions League, as well as golf's first major of the year, the Masters, all big events for bookmakers.

Ulrik Bengtsson, the chief executive of William Hill, said the company had taken bets on horse and greyhound racing, the international soccer that was still being played and virtual sports in recent days.

Bookmakers are already under pressure from rising taxes in major markets and a crackdown in Britain which includes limits on the size of stakes on gaming machines in betting shops. They have responded with a push into the U.S. market where rules have been relaxed.

"The challenge currently facing our business and the industry more widely is unprecedented in modern times," Flutter Chief Executive Peter Jackson said in a statement.

Flutter agreed last October to buy Canadian Poker Stars operator Stars Group Inc (TSG) in a $6 billion share deal set to create the world's largest online betting and gambling company by revenue.

(Additional reporting by Patrick Graham and Tanishaa Nadkar in Bengaluru, editing by Emelia Sithole-Matarise and Keith Weir)

By Padraic Halpin and Tanishaa Nadkar


© Reuters 2020
Stocks mentioned in the article
ChangeLast1st jan.
AT HOME GROUP INC. -1.04% 18.94 Delayed Quote.244.36%
FLUTTER ENTERTAINMENT PLC -1.09% 153.85 Delayed Quote.45.92%
GVC HOLDINGS PLC 0.29% 1047.5 Delayed Quote.17.11%
JUST GROUP PLC 0.44% 56.1 Delayed Quote.-29.11%
LETS HOLDINGS GROUP CO., LTD. -1.52% 9.08 End-of-day quote.50.33%
LOOK HOLDINGS INCORPORATED -6.51% 976 End-of-day quote.-22.04%
NEXT PLC 1.43% 6675.675 Delayed Quote.-6.64%
THE GLOBAL LTD. 6.25% 289 End-of-day quote.-38.64%
THE NEW HOME COMPANY INC. -2.43% 5.62 Delayed Quote.20.60%
THE STARS GROUP INC. 0.00%End-of-day quote.10.62%
WILL GROUP, INC. -3.36% 979 End-of-day quote.-21.81%
WILLIAM HILL 0.24% 268.7 Delayed Quote.42.32%
WORLD CO., LTD. -3.68% 1282 End-of-day quote.-52.36%
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Financials
Sales 2020 3 548 M 4 727 M 4 727 M
Net income 2020 107 M 142 M 142 M
Net Debt 2020 1 930 M 2 571 M 2 571 M
P/E ratio 2020 129x
Yield 2020 0,47%
Capitalization 6 058 M 8 081 M 8 071 M
EV / Sales 2020 2,25x
EV / Sales 2021 2,05x
Nbr of Employees 18 980
Free-Float 99,3%
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Technical analysis trends GVC HOLDINGS PLC
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Income Statement Evolution
Consensus
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Mean consensus BUY
Number of Analysts 18
Average target price 1 310,40 GBX
Last Close Price 1 035,50 GBX
Spread / Highest target 54,5%
Spread / Average Target 26,5%
Spread / Lowest Target -5,84%
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Managers
NameTitle
Shay Segev Chief Executive Officer & Director
John Michael Barry Gibson Non-Executive Chairman
Sandeep Tiku Chief Operating Officer
Robert Matthew Wood Chief Financial Officer & Director
Stephen Morana Senior Independent Non-Executive Director
Sector and Competitors
1st jan.Capitalization (M$)
GVC HOLDINGS PLC17.11%8 081
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GALAXY ENTERTAINMENT GROUP LIMITED2.79%33 047
FLUTTER ENTERTAINMENT PLC45.92%28 774
EVOLUTION GAMING GROUP AB160.00%15 524
ARISTOCRAT LEISURE LIMITED-4.78%15 044