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Stride Gaming PLC

Stride Gaming comes on leaps and bounds

Stride spent over of £70mln on 8Ball, Netboost Media and the Tarco Assets as it roll-up strategy gained traction.

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The company is at the vanguard of online bingo.

The bingo group Stride Gaming PLC (LON:STR) revealed impressive growth in revenues and earnings as the impact of a recent spate of acquisitions was felt on the top and bottom lines.

Stride spent over of £70mln on 8Ball, Netboost Media and the Tarco Assets as it roll-up strategy gained traction.

They helped push net gaming revenue up 22% to almost £48mln and EBITDA 27% higher to £12.3mln in the 12 months ended August.

With £21.1mln cash in the bank, Stride was able to pay a 1.4p a share final dividend, taking the total payout to 2.5p – which equates to a 1% yield.

WATCH: CEO Eitan Boyd speaks to Proactive's Andrew Scott

READ: The results statement in full

A successful share placing brought in £27mln, while Stride has renegotiated an £8mln debt facility with Barclays, providing the fire-power to pick off other opportunities.

Operationally, the business appears to be performing strongly with real money gaming funded players up 37% at 71,220.

Importantly there has been underlying progress with the yield per player advancing 7% to £120.

"The business has never been in such a strong position to build on its excellent achievements of 2016,” said chief executive Eitan Boyd.

“Our focus in 2016/17 will be on integrating these recent acquisitions, continuing our strong organic growth and examining entry into other soft gaming verticals.

“Looking ahead, we are excited by the outlook for the Group as we build on our goal of being the leading UK based soft gaming company and maximising value for shareholders."

Shares in the owner of Kitty Bingo and Lucky Pants were changing hands for 230p. It listed on AIM last May at 132p.

“Stride has made significant progress since its IPO, building real scale in the soft gaming market,” said Canaccord Genuity, which reckons the stock is worth 344p.

“Margins will be diluted in 2017 following the Tarco/8Ball acquisition, but we see significant scope for additional rationalisation, and continued premium top-line growth through 2017 and 2018.

“And the current UK government review of pre-watershed advertising by Online Bingo companies would have little impact, given that almost all of its advertising spend is online.”

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Quick facts: Stride Gaming PLC

Price: £1.49

Market: AIM
Market Cap: £112.95 m
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