Increased marketing spend leads to 'expected' EBITDA drop for JPJ

Increased marketing spend leads to 'expected' EBITDA drop for JPJ

Tuesday, August 14, 2018 Posted by Joseph Streeter
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The firm looks to build on its elevated marketing presence

Online gambling group JPJ is looking for a strong finish to the year after reporting an expected EBITDA drop of 4% to £57m in H1 2018.

The key reason that the fall in EBITDA was expected by the firm for the first half of the year was down to a significantly elevated marketing spend, with the firm maximising Paddy McGuinness' presence as a brand ambassador in its marketing campaign.

Neil Goulden, JPJ Group executive chairman, commented on the progress the firm has made: "The first half of the year has seen a continuation of the strong momentum that JPJ Group plc has reported since listing in the UK in January 2017," he said.

“As expected, Adjusted EBITDA1 was down four per cent year-on-year, but is expected to return to growth in the second half of the year following the conclusion of the TV advertising campaigns and as we pass the anniversary of the introduction of the POC2 on gross gaming revenue in the UK.

"There were also several significant milestones for the Group during the period. In June, we announced the intention to move to a premium listing on the London Stock Exchange, which was effective from 26 July 2018. We believe this provides us with an appropriate platform for continued growth, as well as exposure to a wider investor base and enhanced liquidity in our shares.”

He went onto emphasise that it also confirmed the key acquisition of Botemania in this period, stating: “We made the final earn-out payment to Gamesys in relation to Botemania, which was comfortably met from existing cash balances, and today we announced that we have signed a share purchase agreement for the sale of the social business enabling us to focus solely on our core activity of real money gaming.

"Looking ahead, I am confident that the Group's strong cash flow generation provides us with the opportunity to create additional value for shareholders as we continue to deleverage."

Totally Gaming says: Although the results detail that it was a tough period for JPJ, with its strong marketing campaign and acquisitions, the firm has positioned itself well to prosper and build momentum to finish the year strongly. The firm also detailed the sale of its social business for £18.1m, further affirming that it wants to boost revenues and EBITDA as the year culminates.

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