The Biggest Online Bookmaker in Latin America Flourishes Prior the World Cup

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The world will be all about football very soon with the World Cup tournament happening in Brazil this summer, and the largest online bookmaker in Latin America is already benefiting.

The World Cup betting at various online sportsbooks in the UK
online sportsbooks in the UK and around the world is already in full swing, giving football fans and experts an endless topic of conversations.

Most bookies expect the home country Brazil to win with odds at 13/4, Argentina is at 5/1, Germany comes at 6/1, Spain at 7/1 and England has almost no chances at 33/1.

Millions will be spend on the world football fiesta and it is more than certain that GVC Holdings will be even more successful this year.

The acquisition

The shares of the Isle of Man-based company, which operates under UK gambling laws
, rose with 18.5p or 5% ahead to 398.5p after it was announced that the operating profits had reached more than double levels to EUR 38.3 million in 2013, enhanced by the acquisition of Sportingbet in 2013. The overall revenue for 2013 rose 69% to EUR 180.6 million.

GVC Holdings makes an extremely successful deal with the acquisition of Sportingbet in partnership with William Hill

• GVC operating profits reached EUR 38.3 million in 2013

• GVC revenue for 2013 rose 69% to EUR 180.6 million

• Q1 2014 revenues of the company reached “record levels”

The success of Sportingbet under the new management definitely exceeded the analysts’ expectations proving that GVC made an extremely successful deal.

GVC was the junior partner to William Hill in the GBP 485 million takeover of the online gambling outfit in March 2013, obtaining Sportingbet’s operations in 24 countries for GBP 31 million approximately.

William Hill on the other hand took over the businesses of the better regulated Australia and Spain markets.

The businessman Richard Griffiths, who owns 14.9% and the rest of the major shareholders, took a 120% dividend increase to 48.5 cents. He has been supporting the company for long years now and first bought stock at 70p six years ago.

Company’s expectations

Kenneth Alexander, chief executive of GVC, commented: “Executing the complex acquisition and turnaround of Sportingbet has been a milestone for GVC and has led to greater geographical diversification and a significant increase in profits and dividends.”

He added: “We are now ready for the next stage in our corporate development and further geographic expansion through organic growth and acquisitions.”

Moreover: “Any deal would not be at the expense of a policy of paying out around 75% of operating cash flow in dividends.”

Daniel Stewart, a broker, announced a target price of 476p and added that GVC occupies top position in market share terms in Brazil.

This comment represents the prosperous future of CVC in Brazil, but it also hints about the significant opportunity for GVC to further grow the brand and expand in other Latin American markets.

The future

The future definitely looks successful especially looking at the performance of the sports betting last year, which rose 125% in 2013 to EUR 1.17 billion, of which the significant amount of EUR 662 million came only from Sportingbet.

Sports betting made 52% of GVC’s overall revenue, leaving the gaming revenue way behind for the first time in the company’s history. In-play wagers accounted for 70% of all sports bets and not surprisingly the hit mobile wagering increased nine points to 19% of the sportsbook revenue.

The most popular sports football, tennis and basketball accounted for 90% of GVC’s sports betting share.

GVC reported that the successful time for the company has transferred into 2014, which can be noticed in the Q1 revenues, which were at “record levels.”

The revenue for the first three months of 2014 is expected to be around EUR 50 million, which is significantly higher than the EUR 35.6 million achieved at the same period last year.

The sports betting business is around EUR 3.8 million/day, which is twice more than the results from a year ago, with margins of 10.1%. The net gaming revenue is also up 41% to EUR 556,000/per day, which definitely means that the full-year market expectations will be met for sure.

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