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Increased marketing to drive further interactive growth for Gala Coral

21st August 2013 9:53 am GMT

Gala Coral has reported turnover of £72.4m from its interactive businesses for the first nine months of its financial year, an increase of 36 per cent compared to the same period a year ago, with increased marketing expected to drive further growth from the business into the next financial year.

The online growth helped overall turnover increase by 9 per cent to £259.1m for the quarter, with gross profit rising 3 per cent year-on-year to £194.0m, reflecting growth across all of the company’s businesses except Gala Retail.

Q3 2012/13 Gross Profit

British Pounds (£) Q3 2011/12Q3 2012/13
    
Coral Retail 111.3m115.7m
Coral Interactive 3.7m7.6m
Coral Telebet 0.8m1.4m
Italy 4.6m4.7m
Gala Retail Bingo 52.7m47.8m
Gala Retail Casino 4.6m4.4m
Gala Interactive 9.8m12.4m
TOTAL 187.5m194.0m

Amounts staked from Coral Interactive soared 128 per cent to £298.1m, with triple digit growth across both sports betting and gaming, up 160 per cent and 120 per cent respectively to £67.4m and £230.7m.

This generated total gross win of £12.0m, double the level of last year, with sports betting up 119 per cent to £4.6m and gaming up 90 per cent to £7.4m.

Buoyed by a 15 per cent increase in Coral.co.uk players to 197,100, the business reported gross profit of £7.6m, up 105 per cent versus a year ago.

Gala Interactive also performed well during the period, with amounts staked across Galabingo.com and Galacasino.com climbing 44 per cent to £332.4m. Total gross win rose 50 per cent to £19.0m following strong growth in Galacasino.com which saw gross win soar 190 per cent to £3.9m on the back of a 424 per cent rise in active players to 38,800.

Gross win from Galabingo.com grew by 33 per cent to £15.1m, with active players up by 4 per cent year-on-year to 137,900 following investment in TV campaigns and a further release of the new mobile app at the end of the quarter.

Gala Interactive generated gross profit of £12.4m, an increase of 27 per cent compared to last year.

Gala Coral Group CEO Carl Leaver said: “The performance of both Coral Interactive and Gala Interactive remains encouraging with both returning significant year-on-year growth in actives and gross profit for the third quarter in a row. This improved performance has been supported by an increased level of marketing that will drive growth into the next financial year.”

In Italy, online sports betting amounts staked increased by 44 per cent to £18.6m, generating gross win of £1.9m, up 58 per cent year-on-year. Other gross win rose 15 per cent to £5.4m, primarily as a result of the availability of a wider range of online games.

Overall gross profit from Eurobet Italia rose 19 per cent to £12.6m, with the business becoming the first operator to receive 500 new licences in July.

The first of the 500 new shops opened at the end of July, with the company on course to open over three quarters of the new shops by the end of the calendar year.

Coral Retail remains the company’s largest individual business, contributing gross win of £146.6m during the quarter, up 1 per cent compared to last year. Total amount stakes fell by 2 per cent to £2,550.0 however following declines across both over-the-counter (OTC) and machines.

Gala Retail saw gross profit fall 9 per cent to £47.8m following a 6 per cent drop in admissions to 3,585,000 and a 4 per cent decline in spend per head to £34.62.

“The group posted a resilient performance in the quarter, which saw underlying gross profit growth in all our businesses with the exception of Gala Retail,” continued Leaver. “Both Gala Retail and Coral Retail continue to face a challenging consumer environment, with footfall down in both businesses.”

For the 40-week period ended July 6th, Gala Coral reported a 6 per cent increase in total turnover to £870.6m, with gross profit rising 3 per cent to £654.2m.

Year-to-Date Turnover (including discontinued operations)

British Pounds (£) YTD 2011/12YTD 2012/13
    
Coral Retail 465.4m497.9m
Coral Interactive 19.3m26.8m
Italy 52.4m57.0m
Gala Retail 235.4m225.8m
Gala Interactive 34.0m45.6m
Gala Casino 105.9m87.3m
TOTAL 912.4m940.4m

Gala Coral added that trading since the end of the quarter has become “increasingly challenging” with the hot weather having a significant impact on footfall in its UK Retail businesses.

The company’s bookmaking businesses have also been impacted by adverse horse racing margins during the 5 weeks since the end of Q3 as smaller fields have impacted results, although Coral Interactive and Gala Interactive continue to show positive year-on-year growth in active users and stakes.

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