The Stars Group Inc, formerly known as Amaya Inc, saw its revenue grow 7.9% year-on-year for 2Q17, despite a decline in its core online poker business.
Amaya reported revenue of US$305.5 million for the three months to 30 June 2017, up from US$285.8 million 12 months earlier, while revenue for the first six months of the year grew 8.4% to US$622.6 million.
The results included a 27.1% rise in net earnings for the quarter to US$114 milion and a 12.8% increase in Adjusted EBITDA to US$146.5 million.
However, The Stars Group saw real money poker revenues, which comprise 66.5% of the company’s total revenues primarily via its flagship PokerStars and Full Tilt sites, decline 5.9% to US$202.9 million. It attributed much of the decline to falling user rates at Full Tilt, with the number of unique users playing online poker across all sites for the quarter down 4% to 2.0 million.
Instead, growth came from the casino and sportsbook sector, which generated US$89.6 million – up 50.2% year-on-year for the second quarter of 2017. Casino and sportsbook comprised 29.3% of revenue for The Stars Group, up from 20.9% 12 months earlier.
“Our evolution and transformation into The Stars Group continued (in 2Q17) as we completed our name change and head office move, while our second quarter saw the strengthening of our core senior management team and continued solid revenue growth led by our real money online casino offering,” said CEO Rafi Ashkenazi. “We plan to use this momentum to continue improving and strengthening our business and pursuing our strategic objectives.”
The Stars Group had long term debt outstanding at the end of the quarter of US$2.55 billion, having prepaid without penalty this week approximately $US40 million under its second lien term loan using cash flow from operations, which it said will result in approximately US$3 million in annual interest savings.
In May, the company made its final payment on the outstanding balance of the deferred purchase price for its acquisition of the Rational Group, now known as Stars Interactive, in August 2014, which included the remaining balance of US$47.5 million and approximately US$870,000 of associated fees.
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