888 Holdings FY profit and revenue jump, special divi announced

Online gaming entertainment and solutions provider 888 Holdings reported a rise in revenue for the year ended 31 December as it lifted its dividend and announced a special dividend.

Revenue rose to an all-time high $520.8m from $462.1m the year before, up 13% or 18% at constant currency, while pre-tax profit increased to $59.2m from $32.5m.

B2C revenue was up 15% to $460.2m, Casino revenue increased 21% to $279.3m, and revenue from Sport was up 49% to $51.9m.

Basic earnings per share rose 74% to 14.4 cents and the board recommended a final dividend of 5.1 cents per share, up from 4 cents the year before. Along with a 10.5 cents per share additional one-off, this brought the total dividend for the year to 19.4 cents per share, up from 15.5 cents.

888 said Mobile continues to drive growth across all verticals and now represents 60% of UK B2C revenue, up from 47% the year before.

Meanwhile, the number of active players increased 27% in Casino, and 49% in Active Sports.

Chief executive officer Itai Frieberger said: "2016 was another fantastic year for 888 during which we continued to deliver very strong organic revenue and profit growth. This was again underpinned by further outstanding progress in Casino, Sport and across regulated markets. 888's further expansion in the UK, Spain and Italy is a strong demonstration of the group's ability to drive excellent growth and build leading market positions across regulated markets as the industry continues to head in this direction.

"These strong results demonstrate the truly outstanding underlying momentum in the business. In addition, the group's strong free cash flow and confidence in the outlook has enabled the board to propose a 25% increase in total dividend for the year.

The company said current trading since the start of the year remains healthy, with average daily revenue more than 11% above the previous year at constant currency.

Numis said this was "a very strong set of results", with revenue 2% ahead of consensus.

"Earnings quality continues to improve with regulated revenues now representing 61% of the group. 888 is well diversified, with proprietary technology and a strong balance sheet. Having sat on the M&A sidelines for several years, we still see scope for it to be involved in industry consolidation," said Numis, as it reiterated its 'buy' recommendation.

At 0950 GMT, the shares were up 8% to 252.75p.