888 revenues down on the back of responsible gambling measures
888 has announced an 18% decline in revenues in the UK for the first half (H1) of 2018, with the company saying “proactive and prudent customer protection measures implemented over the last 18 months have adversely impacted revenue”.
Group revenue actually increased 1%, but UK revenues were down 18% to £739m. UK revenues accounted for 32% of total group revenues for the period. The share price dropped 7% immediately after the news was announced.
Regulatory measures, such as industry crackdowns on anti-money laundering processes, along with other responsible gambling measures, like customer protection and due diligence, are one of the main forces behind the revenue drop in the UK.
The trend has also carried over into H1, where daily revenue is also down in the UK.
Speaking about the results, chief executive officer, Itai Frieberger, said:
We have been adapting the way that we operate for the long-term growth of our business by enhancing customer protection practices through innovation and automation as well as diversifying marketing investment into higher growth areas of the business, thereby reducing exposure to any one single market. I am pleased to report that since the period end we have started to see positive trends in the UK on the back of the optimisation efforts implemented over the past 18 month.– Itai Frieberger, 888 chief executive officer
Frieberger also pointed out that the implementation of the responsible gambling measures are now complete. Other firms, that have perhaps taken customers from 888 during the process, must soon start to implement their own measures.
There are of course operational and business highlights from the first half of 2018. The group referenced the launch of 888Poker in Italy and the renewed deal with the Delaware Lottery made in May.
888Sport has also been rolled out in New Jersey. Frieberger called the US a key growth market for the firm, which will look to capitalise on its existing networks and partnerships there, saying:
We have continued to invest in our US operations for long-term growth including extending our inter-state poker network across all three currently regulated states, significantly enhancing our casino product and, most recently, launching sports betting in New Jersey.– Itai Frieberger, 888 chief executive officer