Just months before it gets ready to acquire its bookmaker rival, the online gambling company has hit record sales, passing the USD 1.2 B landmark in revenue 2017.
GVC announced its net gaming revenue passed the €1bn (USD 1.2 B) mark for the first time in 2017 after a 13pc rise on a pro forma basis. This assumes its Bwin acquisition had completed at the start of 2016 rather than in February of that year.
Moreover, if shareholders back its latest attempt to buy up Ladbrokes, the move would catapult it into the FTSE 100, with a market capitalization of roughly £5.3bn (USD 7.2 B) - larger than retail stalwart Marks & Spencer.
Although the amount of money wagered on sports betting in the three months to Dec 31 dropped 6pc on a constant currency basis to €11.2m (USD 15.1 M) a day, its net gaming revenue rose 40pc to €1.2m daily, suggesting more bets went its way rather than that of its customers.
GVC’s move for Ladbrokes was described as “genius” by some investors as the deal's structure means a different price will be paid depending on how damaging the Government’s review into fixed odds betting terminals (FOBT) will be.
If the Government decides to cut stakes on the machines from their £100 maximum limit now to £2, then GVC will simply pay the £3.1bn it has offered for the company. But if the Government only cuts stakes to £50, then GVC would end up paying roughly £3.9bn because Ladbrokes shops would likely remain more profitable making the entity worth more.
The Government is consulting on what FOBT stakes should be with the industry and responses are due by Jan 23. The options it outlined in the consultation consider whether to introduce a cap of £2, £20, £30 or £50, or make no change.
The machines have courted controversy for their high stakes and have been blamed for contributing to a rise in problem gambling.