Gala Coral Turns In Solid Second Quarter Results


19th May, 2014 at 15:50:32

Online and mobile bolster retail business impacted by poor football results

Gala Coral Group delivered strong results in its Quarter 2, 2014 trading update despite experiencing abnormally adverse football results during the quarter.

Key trading highlights for the Continuing Operations for the twelve week period ended 12 April 2014 include:

- Turnover was 8% ahead of last year and gross profit of 215.0 million was 6.2 million or 3% ahead, reflecting growth in the Online business, Eurobet Retail and Gala Retail.

- Continuing Opco EBITDA (pre-exceptionals) of 62.7 million was in-line with last year, despite particularly poor football results.

- Underlying EBITDA (pre-exceptionals) grew y-o-y by 9.9 million or 16% after adjusting for the adverse impact of exceptional football losses ( 8.1 million), MGD, weather and the phasing of machine costs.

Coral Retail:

- Gross profit was 5.6 million behind last year, due to the abnormally poor football results in the quarter ( 5.4 million), and the phasing of machine costs recorded in gross profit ( 2.1 million). - Machines continued to outperform the market, delivering gross win per machine per week of 965 ( 12 ahead of 2013). - EBITDA (pre-exceptionals) was 8.9 million behind.

Eurobet Retail:

- Gross profit was 3.1 million or 61% ahead of last year. - EBITDA (pre-exceptionals) was 2.2 million or 63% ahead. - Sports stakes were 24.7 million or 63% ahead of last year, with 445 of the new tender licences open at the end of the quarter and the remaining 55 licences due to open in quarter 3.

Gala Retail Bingo:

- Grew like-for-like admissions (3% ahead of last year) - EBITDA (pre-exceptionals) was 5% ahead for the second quarter running.


- Gross profit of 10.1 million was 44% ahead of last year. - EBITDA (pre-exceptionals) of 11.4 million was 6.6 million or 138% ahead. - Stakes were 62% ahead driven by increasing active numbers and spend per head.

Actives were 38% ahead of last year, driven by TV advertising, Coral Connect sign-USA and improved site performance. Sports stakes were 43.5 million or 64% ahead of last year. Live streaming bet in play stakes increased by 84% year-on-year. Gaming stakes were 56% ahead of last year and a 0.9pp improvement in margin resulted in a gross win increase of 6.8 million or 103% ahead at 13.4 million. Mobile penetration increased by 12.3pp to 64% of actives. :

Actives were 20% ahead of last year. Sports stakes were 5.3 million or 24% ahead Gaming stakes were 28.7 million or 26% ahead, driving total gross win to 1.7 million or 22% ahead of last year. Sports gross profit was 0.1 million ahead, benefiting from less volatile sports margins than Eurobet Retail. Gaming gross profit was 0.2 million ahead, with virtual betting and growth in in-house games offsetting a decline in poker. Mobile penetration is now at 42% of actives Online sportsbetting market share is 9.4 percent, an increase of 1.0 pp over the past year.

39% increase in spend per active. YTD real money players are 5% ahead of last year. Stakes were 51.5 million or 24% ahead of last year Gross win was 2.6 million or 17% ahead. Mobile penetration increased by 21.7pp to 52% of actives.

Actives were 38% ahead of last year Spend per active was 70% ahead, driving a 133% increase in stakes and a 2.0 million or 73% increase in gross win. Mobile penetration increased by 9.9pp to 31 percent.

Carl Leaver, Group Chief Executive of Gala Coral Group, commented:

The Group delivered strong underlying growth for the second quarter in a row. Online growth momentum is very encouraging with now coming through strongly. The combination of a single online wallet, improved content and simplified customer journeys is driving both actives and spend per head significantly ahead of expectations.

"The take-up on mobile is particularly pleasing with over 66% of sportsbook actives now using our mobile platform.

"In Italy, the demand for the new virtual betting products launched in the new year remains very strong in both Retail and Online, and the rollout of the tender shops continues to drive market share gain, with retail sportsbook market share now at 11.5 percent, up 4.1pp in twelve months.

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