We employ c2,800 people across 15 offices and four
continents. Creating a Group-wide identity and culture
based on common values has been an important
part of the integration process. Our core values of
collaboration, dynamism, ownership, recognition and
transparency, reflect the culture of our business and
what we believe is required to succeed in a highly
competitive and rapidly evolving industry.
It is a reflection of the progress made and the potential
of GVC, that the Group has been able to attract
a number of highly regarded professionals from
across the gaming industry and beyond. This has
enabled us to strengthen our business in a number
of areas, the benefits of which have already begun
to be experienced, but with much more to come.
The Group's financial performance during the year
exceeded our original expectations both in terms
of Net Gaming Revenue (NGR) and Clean EBITDA.
Pro forma NGR increased 9% to €894.6m and by
12% in constant currency. Meanwhile, pro forma
Clean EBITDA increased 26% to €205.7m, reflecting
an increase in margin to 23% from 20%. Net debt
as at 31 December 2016 was €131.5m, just 0.6x
We remain on target to secure €125m of synergies by
the end of 2017 with the full impact being derived in
2018 in line with the timetable we set out at the time
of the bwin.party acquisition. In addition to this, annual
capital expenditure is expected to be approximately
€20m lower per annum than the combined Group
spent in 2015.
The Group's progress is clearly reflected in the
development of our financing structure. In October
2016, we secured a short term €250m loan facility
from Nomura International plc (the "Nomura Loan"),
which was used in part to fully retire the €400m
loan provided by Cerberus Business Finance LLP.
The Nomura Loan significantly lowered our
In February 2017, we launched our inaugural
syndicated debt offer to great success. A €250m
Senior Secured six year term loan (the "Term Loan")
was significantly oversubscribed. This was used to
pay down the Nomura Loan in full. In addition, we also
secured a €70m Revolving Credit Facility ("RCF").
The new financing gives us both significant financing
visibility and also access to a broad number of debt
investors. Given the ongoing industry consolidation
and GVC's proven track record of adding shareholder
value through mergers and acquisitions this is an
important development for the Group.
The strong underlying performance of the business
together with the favourable refinancing enabled the
Group to declare a special dividend in November,
which was subsequently increased by 49% in
December to euro 14.9c per share. The dividend
was settled in sterling at 12.5p per share and paid
14 February 2017. In addition, we have also declared
a second special dividend of euro 15.1c, giving total
declared dividends of euro 30c per share for the
financial year ended 31 December 2016. For the 2017
financial year and beyond, we will pursue a progressive
dividend policy, reflecting the growth in the business
and aiming to return no less than 50% of free cash
flow. In addition, the Board will also give consideration
to returning future excess cash to shareholders.
Excess cash will be determined by the capital
requirements of the business, together with the
trading outlook at the appropriate time.
I would also like to take this opportunity to thank
Richard Cooper, who retired as Group Finance Director
and from the Board in February 2017. Richard joined
the Group in 2008 and has been a major part of the
Company's success over the past eight years. We wish
him all the success in the future. I would also like to
welcome aboard Paul Miles who joined us as Chief
Financial Officer in February.
Finally, as announced separately today, Will Whitehorn
has been appointed to the Board as Senior Independent
Non-executive Director. Will is a highly experienced
business professional and is a significant appointment
for the Group. He is the Deputy Chairman and Senior
Independent Director of Stagecoach Group plc and is
an Independent Non-executive Director of Purplebricks
Group plc. This builds upon the strengthening of the
Board in 2016 when Stephen Morana, Peter Isola and
Norbert Teufelberger joined the Group.
Through the combination of talented people, proprietary
technology and strong brands, GVC is well placed to
pursue the many opportunities and face the challenges
presented by the dynamic industry in which we operate.
GVC will be posting its Annual Report to shareholders
the week commencing 1 May 2017 and it will be
uploaded on our website (www.gvc-plc.com) from
that date. The AGM will be held in Gibraltar and is
scheduled for 20 June 2017.
WE NOT ONLY ACHIEVED
ALL OF OUR TARGETS,
BUT IN MOST CASES
WE EXCEEDED THEM.
23 March 2017
2016 was the most significant year in the Group's
history. The acquisition of bwin.party was
completed on 1 February 2016 and transformed
GVC into one of the leading global businesses in the
online gaming industry. Importantly, the purchase
of bwin.party was consistent with our strategy; to
deliver increased scale, further international diversity
and enable us to leverage our proprietary technology
and exceptional management team. In a competitive
and rapidly evolving global regulatory environment,
we believe this strategy leaves GVC well placed to
continue to create shareholder value.
In August, just six months after completing the
bwin.party transaction, the Group was admitted to
the Premium Segment of the Official List. A month
later GVC became a constituent of the FTSE 250
index, having grown from a market value of less than
£100m four years ago to over £2bn today.
GVC is highly ambitious and focused on measurable
delivery. Therefore, it is pleasing to report the
Group achieved a strong operational and financial
performance in 2016.
A year of significant progress...
As a management team and a business we set
ourselves a number of targets in 2016, and
I'm pleased to be able to say that we not only
achieved all of these targets but also in most cases
The integration of bwin.party was a key focus of
2016 and whilst all such large scale transactions
present challenges, the assimilation of the business
has progressed positively and is ahead of our initial
expectations. Our talented, hardworking team and the
corporate culture we have fostered have been the key
drivers for a smooth integration.