The Stars Group Posts Q3 Results, Reveals Strong Revenue Growth
The Canadian gaming giant The Stars Group has announced the results for the third quarter of this year, revealing a solid increase in revenue.
According to available information, The Stars Group recorded a 73.6% rise in revenue during the three-month period ending on September 30, while the acquisitions of Sky Betting and Gaming, CrownBet and William Hill Australia have been cited as the main factors behind such an impressive result.
Numbers Going Up
Revenue for the period reached $572 million, while a slight drop in poker revenue made no significant impact on the overall results as gaming and betting posted substantial increases.
Poker revenue dropped by 2.6% to $215.7 million, while gaming revenue generated $180.9 million or 116.7% more than in the same period of last year.
Such a staggering increase in gaming revenue was mainly due to the acquisition of SkyBet, while improvements in PokerStars Casino offering, which added more than 250 new titles in the first nine months of the year, also made a significant contribution.
Betting also saw a rise in revenue, with several factors being responsible for such an increase, including the FIFA World Cup in Russia, the SkyBet acquisition, a rise in betting margin for BetStars, as well as the launch of new products in New Jersey. All these factors led to betting revenue rising from $11.7 million to $158.4 million in Q3 2018.
Commenting on the latest results, The Stars Group Chief Executive Officer Rafi Ashkenazi said this had been a landmark quarter during a transformative year, as the company began to deliver on its vision to become the world’s favourite online gaming destination.
He pointed out the company had completed the acquisition of Sky Betting & Gaming, which had been cleared by the CMA in October, making The Stars Group the leader in the UK online betting and gaming market, and added the gaming firm had also launched BetEasy in Australia and sports betting in New Jersey.
Acquisitions Were a Significant Factor
The purchase of SkyBet and the acquisitions made in Australia led to the rise in gross profit for the quarter to $442.8 million, which is 65.8% more than in the corresponding period of 2017. On the other hand, gross profit margin dropped by 4.5 percentage points to 77.4%.
Adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) also went up, jumping by nearly a third to $198.3 million.
Operating expenses rose due to the acquisitions to $276.5 million (145.2%), as well as marketing expenses, which went up by 179.5% to $92.5 million. Research and development costs nearly doubled to $11.9 million, while net financing charges reached $74.4 million.
Ashkenazi stated the company was pleased with the quarterly results, which reflected both continued organic growth from its International business and contributions from both BetEasy and Sky Betting & Gaming, despite unfavorable sporting results during the period.
He added The Stars Group was excited to take advantage of the opportunities ahead of it by leveraging its leading positions in attractive markets, strong brands, technology and operating expertise.
- Totally Gaming: https://totallygaming.com/news/online/acquisitions-drive-strong-revenue-growth-stars-group-q3
- News Wire: https://www.newswire.ca/news-releases/the-stars-group-reports-third-quarter-2018-results-699919701.html
- Gaming Intelligence: https://www.gamingintelligence.com/finance/49777-strong-q3-for-the-stars-group-as-sbg-and-beteasy-drive-revenue-growth