Unprecedented revenue increase right on time for merger negotiations
The Canadian gaming giant The Stars Group has published a report on its activities and incomes for the first quarter of 2020. The company recorded a spectacular double digits increase in its revenues. According to experts, one of the major drivers of this extraordinary performance is, of course, the increase in the number of circumstantial online players, which has almost doubled in the last two months due to global confinement.
Many fans of sports betting have therefore turned to Pay n Play online casinos or poker sites, for lack of professional sports activities on which to bet. At the same time, business seems to be just as fruitful for Flutter Entertainment, which also recorded a nice revenue increase in Q1. Both companies are working on an unprecedented merger that will create the biggest listed online gambling company in the world.
Numbers don't lie! At least when it comes to STG
The future consequences of the current situation are a total mystery to all businesses regardless of the industry. We are all blindly navigating into uncharted territories. No experts can tell or precisely predict the outcome of the drastic measures imposed on more than a third of the world's population, nearly 3 billion people.
However, The Stars Group, which is the mother company of one of the biggest online poker sites “PokerStars”, saw their revenue increased by more than 27% during the first 3 months of 2020. In numbers, the 27% increase in revenue translates into $735 million. These high numbers are also in accordance with the predictions made for the iGaming industry in its entirety.
Interviewed on the situation, The CEO of TSG shared his thoughts on the matter and tried to explain the increase.
It is obvious that, since the beginning of the confinement policies caused by the world sanitary crises, we have noticed a significant traffic increase on our pokers and online casinos sites. In certain markets, we have seen a 44% increase in revenue. It is obvious that people are playing more than they usually do in this period of the year.
However, the British market driven by Skybet and other Gaming businesses has considerably contributed to the revenue growth, with a year over year increase rates estimated at around 66%. Making for around $297 million generated in the first quarter. Here, strong operational dynamism and a net profit margin of over 14% (Year over Year) are some of the principal causes of growth.
Looking into the future merger with optimism.
Given the current financial results, which are more than positive for both Flutter entertainment and the TSG, the road for the future merger is more than secured. Having brilliantly received most of the ratifications and agreements from market authorities of the concerned countries, the transaction, which will determine the fate of the two companies is likely to take place this summer unless there is an unforeseen event.