Gamesys Group PLC Announces Interim Financial Results 2021

Rhea-AI Summary

Gamesys Group plc reported its financial results for the six months ending June 30, 2021, revealing a 17% revenue increase to £398.8 million and a 16% rise in adjusted EBITDA to £110.3 million. The adjusted net income improved by 20% year-on-year, reaching £81.6 million. However, net income was down 40% to £14.0 million compared to the previous year. The company maintained strong cash flow with a cash conversion rate of 94% and reduced its leverage ratio to 1.17x. An interim dividend of 15.0p per share has been declared for October 15, 2021.

Positive

• Revenue increased by 17% to £398.8 million.
• Adjusted EBITDA rose 16% to £110.3 million.
• Adjusted net income increased 20% to £81.6 million.
• Cash conversion rate of 94% from adjusted EBITDA.
• Leverage reduced to 1.17x.

Negative

• Net income decreased by 40% to £14.0 million.
• Diluted net income per share dropped by 41% to 12.7p.
• Revenue in Europe declined by 29% due to regulatory challenges.

Excellent financial performance and operational execution

Revenue ahead 17%, adjusted EBITDA up 16%, leverage reduced

LONDON, UK / ACCESSWIRE / August 10, 2021 / Gamesys Group plc (LSE: GYS) (the 'Group', 'Gamesys') announces its financial results for the six months ended 30 June 2021.

Financial summary

	Six months ended 30 June 2021 (£m)	Six months ended 30 June 2020 (£m)	Reported change (%)
Revenue	398.8	340.0	17
Adjusted EBITDA[1]	110.3	95.0	16
Net income (as reported under IFRS)	14.0	23.3	(40)
Adjusted net income1	81.6	68.1	20
Diluted net income per share[2]	12.7p	21.4p	(41)
Diluted adjusted net income per share1,2	74.2p	62.6p	19

Financial highlights

• Excellent financial performance across the Group
  • Revenue grew by 17% with good momentum in the UK and Asia
  • Adjusted EBITDA¹ increased 16% year-on-year, driven by strong revenue growth
  • Adjusted net income¹ increased 20% year-on-year
• Cash conversion of 94% from adjusted EBITDA¹; adjusted net leverage ratio^[3] reduced to 1.17x
  • Operating cash flow of £103.5 million
• Cash balances at 30 June 2021 increased to £253.7m and post period-end, the Group paid down £100.0 million towards its outstanding term loan debt

Operational highlights

• The Group continues to execute successfully across key LTM performance indicators⁴:
  • Average Active Players per Month^[4] grew 16%, from 640,436 to 744,807
  • On a monthly average basis, Real Money Revenue per Month⁴ increased 23%, from £50.9 million to £62.8 million
  • As a result, Monthly Real Money Revenue per Average Active Player⁴ increased 5%, from £80 to £84
• In the UK, revenues increased 20% in H1 2021 with Virgin Games, Monopoly Casino and Rainbow Riches Casino driving strong performance
• Asia continues to deliver significant double-digit growth with revenues increasing by 30% year-on-year on a constant currency basis^[5]
• In Europe, revenues declined by 29% reflecting a more challenging regulatory environment in Germany, Scandinavia and, to a degree, in Spain
• Revenues in ROW fell marginally by 1% year-on-year, with growth in North America offset by a contraction in other smaller markets

COVID-19 and responsible gambling

• With the pandemic still present in all our operating markets, we remain fully committed to ensuring the health and safety of both our players and employees throughout our global communities. This will remain a top priority whilst the virus is still in existence across our markets worldwide
• We have continued to see 100% continuity in our global business operations, and this is a testament to the commitment and diligence of our teams across the globe. We remain committed to creating a working environment which allows for increased flexibility for all employees in the future
• We continue to take proactive steps to enhance our responsible gambling approach through ongoing investment in new capabilities and resources. This is strengthening our position as a best-in-class operator in protecting our recreational players
• We remain fully supportive of the UK Government's review of the 2005 Gambling Act and reiterate the need for a rigorous evidence-based approach to potential policy change to ensure the complete protection of vulnerable customers whilst also allowing the majority to continue to enjoy their play in a responsible way

Capital allocation, dividend and completion of combination of Gamesys and Bally's Corporation

• The Group has further strengthened its robust balance sheet in the first half of 2021, as exceptional cash generation supports ongoing deleveraging and the paydown of debt on 30 July 2021
• In the scheme document relating to the combination of Gamesys and Bally's Corporation, the Board reserved the right to declare an interim dividend of up to 15.0p. The Board has approved and declared an interim dividend for the year ending 31 December 2021 of 15.0p per ordinary share in the Group ('Ordinary Shares'). The interim dividend will be paid on 15 October 2021 to shareholders on the register on 10 September 2021 and the Ordinary Shares will become ex-dividend on 9 September 2021, subject to the scheme of arrangement not becoming effective before that date
• The combination of Gamesys and Bally's Corporation is expected to become effective in Q4 of the current financial year

Lee Fenton, CEO, Gamesys Group plc, commented:

'The Group has delivered another set of excellent results for the first half of 2021 with revenue growth of 17% and adjusted EBITDA¹ increasing by 16% during the period. This performance reflected significant double-digit revenue growth in our key markets of the UK and Asia and our continuing strong cash flow has seen leverage reduce further. We are fully focused on operational execution, product innovation and the enhancement of safer gambling initiatives across all of our markets and we remain fully confident in the Group's ability to deliver long-term sustainable growth.'

Conference call

There will be a conference call for analysts and investors today at 1.00pm BST / 8.00am ET. To join the call, participants should dial one of the following numbers, using the password 'Gamesys', approximately 10 minutes ahead of the scheduled start time.

UK toll free	0808 109 0700
Canada toll free	1 866 378 3566
USA toll free	1 866 966 5335
Standard international access	+44 (0) 33 0551 0200

A replay facility will be available for 30 days and can be accessed by dialling one of the numbers below and quoting conference 5896372#

Standard international access	+44 (0) 20 8196 1480
USA toll free	1 866 583 1035

A transcript will also be made available on Gamesys Group plc's website at www.gamesysgroup.com/investors

Enquiries

Gamesys Group plc	jason.holden@gamesysgroup.com
Jason Holden	+44 (0) 207 478 8150
Director of Investor Relations	+44 (0) 7812 142118
Finsbury	gamesysgroup-LON@finsbury.com
James Leviton, Robert Allen	+44 (0) 207 251 3801

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SOURCE: Gamesys Group PLC

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FAQ

What were Gamesys Group's revenue and EBITDA figures for H1 2021?

Gamesys Group reported a revenue of £398.8 million and adjusted EBITDA of £110.3 million for the six months ended June 30, 2021.

What is Gamesys Group's interim dividend for 2021?

Gamesys Group declared an interim dividend of 15.0p per share, payable on October 15, 2021.

How much did Gamesys Group's net income change in H1 2021?

Net income for Gamesys Group decreased by 40% to £14.0 million compared to the same period last year.

What was the adjusted net income for Gamesys Group in H1 2021?

The adjusted net income for Gamesys Group in H1 2021 was £81.6 million, reflecting a 20% increase year-on-year.

How did Gamesys Group's performance vary across different regions in H1 2021?

Revenue in the UK increased by 20%, while Asia saw a 30% rise, but Europe experienced a 29% decline due to regulatory issues.