Part 1: Strictly bingo
deleveraging of the balance sheet and supports
But it might also be said that 888 is now
the introduction of a dividend”. The second point doubling down on a “clearly challenged” UK bingo
is important. The debt levels at JPJ, which funded market. It would appear to be a defensive measure
the JackpotJoy acquisition from previous owner – 888 could ill afford to ‘lose’ Mandalay entirely,
(and now platform supplier) Gamesys, remain particularly after having recently seen GVC
high – as of the end of December net debt stood migrate its Cashcade business (which includes
at £302.1m. This is gradually being whittled down; Foxy Bingo) onto its own proprietary platform.
the adjusted net leverage multiple has fallen
For 888, its own 17% fall in bingo revenues in
from 4.5 times EDITDA to 2.7 times. But it still 2018 makes it one of the big losers in the sector
represents a drag on the business. (see table 4). Whether the Mandalay acquisition
After the end of the quarter, JPJ moved to take
materially alters the course of the downward
charge of its own destiny with a £490m deal to organic growth trajectory remains to be seen.
acquire Gamesys’ technology platform, games The company is placing great store in its in-
brands and bingo studios. Regulus Partners house CRM to deliver “synergies and growth
lauded the deal for giving the operator enhanced opportunities” at Mandalay.
strategic flexibility and control, as opposed to
the previous agreement which it noted was Rank and file
“financially very rewarding for Gamesys while Faring better are the oldest brand names in
being both strategically and operationally highly UK bingo, Gala and Rank. For the first, parent
constraining for JPJ”. company GVC itself now hides its bingo light
somewhat under a bushel. There was barely a
Buyer of last resort mention of the performance of Gala Bingo in its
But what about the Mandalay buyer? The results announcement, and it said only that net
Mandalay brands sit on the Dragonfish platform gaming revenue at the Gala unit was up 11% for
and this was clearly seen as a handicap for JPJ. the year and mentioned that post-migration Foxy
So, to an extent, the buying of Mandalay shores up Bingo had managed a “positive” performance.
888’s position within the bingo-led segment. As
can be seen, this has been in decline for a number
We have more detail from Rank, which breaks
out Mecca Interactive revenue in its annual results.
of years, both at the B2C and B2B level, where
bingo makes up a large slice of the revenues.
Its most recent results, for the six months to
December, showed Mecca’s digital revenues rising
Table 4: 888 five-year revenues
888 2014 2015 2016 2017 2018
Revenue ($m) 46.6 44 41.8 39.3 32.4
B2B ($m) 63.9 59.8 60.6 55.2 50.6
Source: Company reports
Table 5: Rank – Mecca Interactive five-year financials
Rank – Mecca Interactive 2014 2015 2016 2017 2018
Revenue (£m) 58.9 65.2 66.2 67.6 75
Operating profit (£m) 15.9 14.1 8.6 Rank Interactive operating profit (£m) 14.6 16.7 13.7 22.7 20.9
Source: Company reports
iGaming Business Market Monitor • UK bingo market, Sweden and Germany • June 2019
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