warns of Covid-19 impact on results

30 March 2020

Affiliate giant Group has issued an update on the effects of the novel coronavirus (Covid-19) on its business, reporting that it generated revenue of €2.4m (£2.1m/$2.7m) for January and February 2020, down 27.4% year-on-year.

Adjusted earnings before income, tax, depreciation and amortisation (EBITDA) came to €390,000, down 66.7%.

The group said that sports betting - which will see a sharp drop in revenue after the near-total shut-down of major global sporting events - made up less than 20% of revenue for the two month period.

This contribution was still enough for Group to warn that it expects the sporting suspensions to lead to a “meaningful negative impact” on revenues.

However, the group said that it does not expect a significant impact on revenue in March, as most events continued as normal for the first half of the month. Group said casino, which is its largest source of revenue, has experienced a slight increase in revenue in the past month.

It has implemented cost-saving measures, through which it expects to save around €150,000 on outgoings, while an unspecified, temporary measure put in place for the second quarter is expected to save €300,000.

The business ended February 2020 with net interest-bearing debt of €9.4m.

Last month (28 February), the group announced that it saw total revenue grow by 6% year-on-year to €17.3m in 2019. However, the group saw a tightening of adjusted earnings during 2019 as it contended with declining contributions from the UK and Sweden, and changes to Google's search algorithms.