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Annual Report & Accounts 2012 - PRINCIPAL RISKS, UNCERTAINTIES AND BUSINESS MODEL
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GVC HOLDINGS PLC BUSINESS REVIEW Risk description Potential impact Mitigation OPERATIONAL continued - Loss of major introducer of business - Poor sports results - Abnormal jackpot wins - Loss of major customer - Reliance on third party payment and multi currency processing systems Reduction of revenue streams Lower or more volatile earnings Lower or more volatile earnings Lower earnings Lower earnings bull; Competitive revenue sharing models applied and monitored regularly. Key introducers are offered long-term revenue prospects with the Group bull; Sports represents less than 25% of the Groups' NGR and sports results, are as a matter of policy not hedged as over the long-term they trend to the Group's expected margin percentage bull; Revenues from some business lines have a jackpot insurance scheme. Others do not have as a matter of policy bull; Highly diversified customer base with over 30,000 customers across all its brands bull; Spreading of risk across a multitude of payment processors with varying deposit and withdrawal methods COMPETITION RISK - The marketplace becomes more competitive via new entrants or by more attractive products available from those or existing competitors Lower revenues bull; Constant monitoring of the competitive landscape bull; Working with third party software providers where possible to enhance product offering TECHNOLOGY RISK - The Group may be threatened by Denial of Service attacks or similar - Hosting platforms may suffer critical failure Temporary disruption of service, blackmail demands Temporary disruption of service, undermining of the confidence built with customers bull; Group has highly advanced preventive measures with world-class technology firms 15