The UK-headquartered, leading betting and gaming company that acquired William Hill’s non-US business in 2022, 888 Holdings Plc, has published its post-close trading figures.
The report indicates an 8% decrease in the group’s annual revenue for the full year 2023, emphasizing important drops in the UK online and global markets.
The fourth quarter’s revenue reached £424 million ($538 million), a number that marked a 7% decrease compared to £457 million ($579 million) in the same quarter in 2022.
The Q4 revenue was also 5% higher compared to Q3 2023, with activities up 5% on a YoY basis. In the context of the continuous growth in the customer base, 888 believes it has what it takes to set the “foundation for sustainable future revenue growth.”
Full Year 2023 Revenue Down Because of a Mix of Factors
As explained in the same update, the group’s FY23 revenue of £1,711 million ($2,170 million) down 8% compared to 2022 was the result of a number of factors including the shift away from dotcom markets, which dropped revenue by around £80 million ($101 million) during FY23.
The customer mix changes recorded in the UK resulting from the additional measures to ensure safe gambling and 888’s marketing changes with a bigger focus on profitability and sustainable revenue have all triggered “a higher quality and more sustainable business mix.”
This featured roughly 95% of FY23 revenue generated from taxed and regulated markets. 888 recorded an 11% increase in the average number of monthly active users in the UK online segment. However, the figure did not suffice to fight off the 18% drop in average revenue per customer.
The FY23 retail revenue went up 3% at £535 million ($678 million) compared to FY22 at £519 million ($658 million). The main triggers were the improvements brought to the product offerings, including the introduction of self-service betting terminals and gaming cabinets.
Outlook for 2024
The company has also expressed a “positive outlook for FY24 revenue with consistent growth in active players driving confidence in strong revenue growth online in both the UK and International segments.”
The group’s compliance and implementation of safer gambling practices are expected to “annualize in February 2024,” which would lead to a more positive outlook in terms of average revenue per user.
888’s profitability, in the long run, will also be positively impacted by the new cost savings program of around £30 million ($38 million) initiated at the end of last year and the additional investments in a greater strengthening of the group’s core capabilities in intelligent automation and artificial intelligence-powered data and insights.
While these measures are expected to boost the group’s profitability in the long term, the additional investments that are underway are also leading 888 to project the 2024 Adjusted EBITDA to be “at the low end of consensus range.”
Chief executive officer Per Widerström commented on the “important strategic and operational progress in the face of some significant regulatory and compliance headwinds” in FY23 while happily announcing the enhancement of the foundations for sustainable and profitable growth.
The CEO also announced that he would outline the group’s 2024-2026 plan together with the full-year results toward the end of March.
Last week, the group announced job cuts in Israel amid its global restructuring plans.