LONDON (Alliance News) - Online gaming operator 32Red PLC Thursday reported strong growth in both profit and revenue for 2014, prompting a 33% increase in its dividend, and gave a confident outlook for 2015, stating that its already benefiting from fewer brands legally accessing the UK marketplace.
32Red declared a 33% increase in its total dividend for the year to 2.4 pence, as it reported a pretax profit of GBP3.4 million for 2014, up from GBP2.3 million in 2013, driven by a 26% increase in net gaming revenue to GBP32.1 million, from GBP25.4 million.
The group said growth in net gaming revenue accelerated in the second half of the year, while it said 2014 marked its fifth consecutive year of double digit organic revenue growth. It said growth is being driven by higher player activity levels following an increase in marketing, and a fast return on investment.
Casino represents around 95% of the group's total net gaming revenue, while the group's fledgling business in Italy it also starting to contribute to revenue growth, as it continues to pump money into the division.
32Red said that trading so far in 2015 to date have been "very strong" across its portfolio, with January and February net gaming revenue up 35% year-on-year.
"While it is too early to gauge the lasting effects of the new licensing regime on the UK market, there are fewer brands legally accessing the UK marketplace and 32Red has experienced strong trading over the last three months," said Chairman David Fish.
32Red shares were trading 5.9% higher Thursday morning at 67.00 pence.
Fish said that while the regulatory changes in the UK and additional tax burdens after some gaming operators' profits, it sees the changes in the industry as an "opportunity".
"The board believes that 32Red is well positioned to exploit such opportunities to accelerate the growth of the business, whether this growth is achieved organically or via acquisition, or both," said Fish.
32Red said it plans to once again increase its marketing investment this year, a move Chief Executive Ed Ware told Alliance News last month that the group would be making.
"We continue to optimise the player experience at the 32Red Casino and recent work on improving our messaging and proposition to the market puts us in a very good position to move forward. With modest levels of market share in the UK and in other markets, we believe a number of opportunities exist for 32Red to significantly expand its reach and profile," said Ware in Thursday's statement.
Last month, Ware told Alliance News that 32Red will increase marketing investment by more than a third this year, as it also seeks to expand into European markets including Germany and Scandinavia, as well as further afield in the lucrative market of Australia.
By Rowena Harris-Doughty; rowenaharrisdoughty@alliancenews.com; @rharrisdoughty
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