<< < > >>
 
| Full PDF report | Print this page |
Annual Report & Accounts 2016 - Performance of divisions
slide
<< < > >>
20 GVC Holdings PLC Annual Report 2016 B2B LEVERAGING TECHNOLOGY NON-CORE The Group provides B2B services to a number of well-known gaming businesses including Borgata (MGM), Danske Spil, Fortuna and PMU. Pro forma divisional revenues in 2016 were €14.2m compared to €14.2m in the previous year, with the contribution being €14.0m versus €13.9m in the previous year. Proprietary technology presents the Group with the opportunity to provide B2B services to third parties, but this has to be balanced with the potential presented from our own B2C operations. We will pursue B2B opportunities that are meaningful but only where there is no significant distraction to our core B2C operations or those that do not compromise our long-term strategy. Consistent with this focus, the B2B agreement with Betfred was mutually terminated. At the end of 2016, we were pleased to strengthen our B2B relationship with Borgata and the MGM Group. Under the new deal, GVC Group will provide an expanded offering beyond Borgata to additional MGM brands in New Jersey, with the potential for the partnership to be extended into other US states, as and when regulation permits. The Group is committed to B2B and currently has an active pipeline of opportunities in line with our strategic focus. Other revenues comprise the financials business, InterTrader. The business undertook a restructuring in 2016, consolidating to a single brand and also bringing in-house a significant part of the operation that was previously outsourced. Whilst this created some disruption in Q3, InterTrader enjoyed its strongest trading period of the year in Q4, reflecting the benefits of the actions taken in the previous quarter. In December 2016, we announced the disposal of payments processor Kalixa for a total cash consideration of €29m (plus potential adjustments up to a maximum €35.5m). The sale is expected to complete in H1 2017. Performance of divisions continued Via a strategic partnership with GVC, Austrian retail solution provider CBCX use GVC's leading live and pre-match content services to drive their dynamic sportsbook products in the retail environment. Leading Czech based sports betting operator Fortuna moved to GVC's live content feed in 2013, increasing the number of events offered to their customers by 60%, and driving double digit annual revenue growth. PMU is the French horseracing monopoly and one of the largest gambling companies in Europe. GVC has supplied online poker to PMU in the regulated French market since July 2010. The Borgata Hotel, Casino & Spa is New Jersey's largest casino property. GVC has supplied online casino and poker products to The Borgata since New Jersey regulated online gaming in November 2013. Danske Spil is the Danish monopoly lottery operator and market leader in online gaming. GVC has supplied online casino and poker in the regulated Danish market since January 2012. B2B Pro forma Change% Constant currency% Actual 2016 €m 2015 €m 2016 €m 2015 €m Revenue 14.2 14.2 0 0 13.3 - Contribution 14.0 13.9 1 1 13.1 - Contribution margin % 99 98 98 -