£765.5m market cap
706p last close
Gamesys Group (formerly JPJ Group plc) is a leading online gaming operator which provides online bingo and casino games to a global customer base.
Investment summary
Gamesys’ pro forma Q319 revenues increased by 20% to £144.3m due to 57% growth in Vera&John (international markets), strong momentum in the acquired Gamesys business and, encouragingly, a return to growth in the Jackpotjoy UK brand. The EBITDA margin declined 680bp to 26.7% as a result of higher taxes and marketing spend. We are raising our FY19 revenues estimate by 2.3% but keeping our EBITDA forecasts unchanged. We continue to forecast net cash flow of £105m in FY20 and our net debt/EBITDA falls from 3.0x currently to 2.0x at end FY20. The stock trades at 6.0x P/E and 7.1x EV/EBITDA, with a 13.8% FCF yield for FY20e.
Y/E Dec |
Revenue (£m) |
EBITDA (£m) |
PBT (£m) |
EPS (p) |
P/E (x) |
P/CF (x) |
|---|---|---|---|---|---|---|
| 2017A | 304.7 | 108.6 | 78.2 | 103.9 | 6.8 | 5.1 |
| 2018A | 319.6 | 112.7 | 92.7 | 118.5 | 6.0 | 4.9 |
| 2019E | 547.4 | 153.8 | 112.8 | 93.7 | 7.5 | 9.0 |
| 2020E | 578.4 | 175.4 | 141.9 | 117.8 | 6.0 | 4.8 |
Industry outlook
In the UK, the government has raised the remote gaming duty from 15% to 21%, with implementation from April 2019. Gaming companies must also comply with a number of social responsibility measures, including ID checking, source of funds and AML checks. Sweden has also introduced a gaming tax of 18% from FY19.
Last updated on 15/11/2019
Sector |
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| Consumer |
Share price graph
Balance sheet |
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| Forecast net debt (£m) | 458.5 |
| Forecast gearing ratio (%) | 93 |
Price performance
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Key management |
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| Neil Goulden | Chairman |
| Keith Laslop | CFO |
