Stars Group confident of 2020 growth despite Covid-19 fallout

The Stars Group (TSG) remains confident it will continue to drive revenue growth despite the impact of the current coronavirus outbreak on global sports.

In a business update, TSG said 62% of its revenue was generated from poker and casino and it expected international revenue in the current quarter to grow on last year, with the UK having experienced “strong underlying trends” and favourable sporting results during the period.

“Overall, we are so far performing ahead of our expectations and currently expect to see strong year-over-year growth in revenues for the first quarter,” TSG CEO Rafi Ashkenazi said.

Ashkenazi said further postponement of cancellation of major sporting events would have a material impact on sports betting revenues in the near term.

TSG’s US-facing Fox Bet brand sent out an email telling customers that bets on events that have been postponed but not cancelled will still have action.

“For all sporting events that are still scheduled, we will strive to create unique betting options for your enjoyment,” the statement said.

Online poker and casino should receive a timely boost during the current period of self-isolation and social distancing, although at present both verticals are legal in only New Jersey and Pennsylvania.

TSG said it has cash and cash equivalents of $321m as of December 31, 2019.

The operator also has access to its revolving credit facility that, together with its current cash and cash equivalents, provides up to $1bn of liquidity.

Last week, Penn National Gaming, which operates multiple casino estates and online brands in the US, opted to borrow $420m from its revolving credit facility to minimize the impact of the coronavirus fallout.