Annual Report & Accounts 2014 - REPORT OF THE CHIEF EXECUTIVE
in 2014 gvc delivered excellent operational and organic growth across the broad spread of markets in which
the group operates. the Board is pleased to report a series of significant increases over those achieved in
2013 across all key financial metrics as shown below.
percentage 2014 2013
increase (€) (€)
Sports wagers 25% 1.5 billion 1.2 billion
proforma revenue 23% 225 million 182 million
NGr 32% 225 million 170 million
contribution 20% 123 million 103 million
clean EBItDa 28% 49.2 million 38.3 million
operating profit 204% 42.9 million 14.1 million
profit before tax 217% 41.3 million 13.0 million
Basic EpS 195% 66.4 cents 22.5 cents
Dividends declared 14% 55.5 cents 48.5 cents
Totals may not sum due to rounding and percentages have been calculated on the underlying rather than the summarised
the group has achieved a record level of clean eBitda for 2014 at €49.2 million which is 28% higher than
the prior year, giving rise to clean net operating cash flows of €42.6 million.
while the focus of 2013 was the integration of the transformational sportingbet acquisition, 2014 was about
identifying where gvc's products and services could be improved, positioning the group for the 2014 world
cup and using this as an event to secure organic growth.
the world cup was a resounding success for the group. not only was the four week event itself prosperous
for the group, particularly in the host country, Brazil, but the event led to a 'step-change' in the retention and
acquisition of customers beyond the world cup final in many of the territories in which the group operates.
gvc invested approximately €7 million into marketing around the world cup and reaped an immediate benefit
in profitability which, following its policy on dividend distribution, allowed the group in september 2014 to
declare a special dividend of 1.5 €cents, and thus returned €1.5 million of the world cup net profits
(approximately €2 million) back to shareholders, in line with its stated dividend policy.
in line with its strategy for 2014, gvc invested in its products. these investments which totaled €3.3 million
(2013: €4k) have been capitalised as required under ias 38 'intangible assets'. given that mobile is fast
becoming the natural choice for players in many markets, continued investment in mobile is seen to be key
to future success. in addition, gvc has broadened its games offering through third party integration. as stated
previously, the ability to offer market leading in-play products is a significant milestone in unlocking additional
organic growth opportunities. in addition, efforts in widening our payments capability and content to assist
the expansion of our in-play market were key achievements as in-play represented 70% of sports gross
gaming revenue (“ggr”) in Q4 2014.
in order to continue the growth momentum achieved in 2014, the strategic product investments gvc plan for
2015 will be around 50% higher than 2014. we believe that increased investment will not only help maintain
gvc's position in its current markets but also be accretive to revenue, as already evidenced by the growth in
wagering and gaming revenues.
average daily KpIs expressed Year on year prior quarter history
in €000s Q1-2015* Q1-2014 change Q2-2014 Q3-2014 Q4-2014
Sports wagers 4,601 3,765 +22% 3,907 3,995 4,366
Sports Margin % 8.9% 10.0% 9.8% 10.5% 9.0%
Sports GGr** %
- In play 73% 67% 59% 61% 70%
- Mobile 35% 21% 24% 28% 34%
Sports NGr 306 279 +10% 296 330 302
Gaming NGr 355 280 +27% 306 325 345
total NGr 661 559 +18% 602 655 647
* to 18 March 2015.
** wagers less payouts before bonuses.
ANNUAL REPORT 2014 6
rEport oF thE chIEF ExEcUtIvE