JPJ Group revenues up 8% despite VIP cutbacks
Growth in Vera&John brand helps offset a 3% decline in Jackpotjoy revenues
JPJ Group this morning reported an 8% rise in Q3 revenues to £77.8m, as dot.com growth from Vera&John helped offset a slight decline from its Jackpotjoy brand in the UK.
Group EBITDA came in ahead of forecasts at £28.8m, up 13% year-on-year, thanks to “strong earnings growth” at Vera&John supported by the brand’s proprietary technology platform.
The Vera&John business segment, which accounts for a third of group revenues, was up 40% year on year, while the Jackpotjoy segment was down 3%.
JPJ said the latter’s performance was mainly due to a decline in the Mandalay brands that was somewhat offset by increases in Starspins and Botemania in Spain.
The operator said performance also impacted by lower revenues from Jackpotjoy UK following the closure of a number of high value accounts due to responsible gambling measures.
“The growth at Vera&John highlights our strategy of international diversification, with 44% of Group revenue generated outside the UK in Q3,” said JPJ executive chairman Neil Goulden.
“As part of our commitment to meeting the highest industry standards on responsible gambling, revenues at Jackpotjoy UK have been impacted by the responsible gambling measures we have implemented and the closure of a number of high value accounts.
“We expect that the impact of closed accounts will begin to annualise during H2 2019 and, provided there are no further regulatory challenges, the Jackpotjoy8 segment will return to revenue growth thereafter.”
Elsewhere, the firm said it will not seek to renew its non-compete arrangement with Gamesys when it expires in April 2019, meaning Gamesys will be free to launch new bingo brands in the UK, Spain and Sweden.
JPJ said the possibility was not a “significant incremental competitive threat,” given its existing strong position in these markets.
Analyst firm Regulus Partners echoed that sentiment. “We doubt that the change will amount to much commercially,” the company said.
“Indeed, a case could be made that a bigger stake in bingo for Gamesys could drive much needed development in the sector,” Regulus added.