Stride predicts full-year revenue rise despite challenging operating climate

Stride predicts full-year revenue rise despite challenging operating climate

Wednesday, September 26, 2018 Posted by News Team
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Bingo operator has set aside £4m to cover a UK Gambling Commission fine

Online bingo operator Stride Gaming said today that it expects revenue for its 2018 financial year to grow to £85m, following a “resilient” performance in the second half of the year. 

However, it also admitted that earnings are likely to be hit by higher taxes and exceptional costs.

Revenue for the year ended August 31st is expected to grow 3.7%, with the company noting that it had traded in line with board expectations in the final six months of the reporting period. 

This, it said, had been achieved against a backdrop of challenging trading conditions, and higher taxation, with total tax for the year expected to amount to £4m.

During the period, the company completed earn-outs for the Tarco and 8Ball businesses which were acquired in 2016, and have since been successfully integrated into the group. It will now look to deliver further operational synergies from the businesses.

Its B2B division Stride Together is also said to be performing well, with its client Aspers Casino achieving strong growth, and additional partnerships in the UK and other markets being explored.

The second half also saw the operator work to implement further measures to ensure it maintains a high standard of responsible gaming controls. This comes with the UK Gambling Commission expected to hand out a fine to Stride as a result of historical operations conducted by one of its subsidiary businesses. 

Stride says that after taking legal advice on the matter, it has now set aside £4m to cover the fine. When the UKGC originally issued a notice of its intention to fine the operator, Stride’s share price was hit, falling 33% in the wake of the announcement.

As a result of the higher taxes and penalty provision, full year adjusted earnings before interest, tax, depreciation and amortisation is expected to fall from £20m in 2017 to £16m. 

"I am pleased to report that the group has traded well during the second half of the year despite a number of headwinds impacting the UK online gaming market,” Stride chief executive Eitan Boyd said. "Our focus remains on delivering further market share growth in the UK, driven by continued product innovation and increasing player loyalty. This is underpinned by the strength of our proprietary technology as well as our proven business analytics capabilities.

"We have an excellent technology platform as well as a highly experienced team driving the group forward, and as a result we look forward to the future with confidence.”

Stride will report its results for the 12 months ended August 31st on November 21st.

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