Investors keen on gambling site’s optimistic outlook
Stars Group boosts 2017 revenue, earnings guidance
THE STARS Group Inc. has updated its previously announced guidance ranges for the full year 2017 and will prepay an additional $75-million of second lien debt. All dollar amounts are in U.S. dollars.
“It’s been a great three months since joining The Stars Group and the team is energized,” said Brian Kyle, chief financial officer. “As I am now fully familiar with our forecasting and given our solid trends across all business lines, which reinforce our conviction and commitment to our strategy, it is now appropriate to update our financial guidance. In addition, given our progress to date, we
are also able to make another meaningful prepayment of our debt.”
Full year guidance
Based on year-to-date performance, The Stars Group has updated its previous full year 2017 guidance and now expects:
• Revenues of between $1,285-million and $1,315-million, as compared with the prior range of $1.2-billion and $1.26-billion. The revised guidance implies 2017 revenue growth of between 11 per cent and 14 per cent compared with t he prior year and includes an expectation that real-money on-line poker revenue will be slightly higher year over year as The Stars Group, among other things, continues to experience a very positive consumer response to Stars Rewards, which was rolled out globally in July;
• Adjusted earnings before interest, taxes, depreciation and amortization of between $590-million and $610-million, as compared with the prior range of $560-million and $580-million. The revised guidance implies 2017 adjusted EBITDA growth of between 13 per cent and 16 per cent compared with prior year;
• Adjusted net earnings of between $445-million and $469-million, as compared with the prior range of $413-million and $437-million and as compared with approximately $367-million in 2016;
• Adjusted net earnings per diluted share of between $2.17 and $2.31, as compared with the previous range of between $2.01 and $2.15 and as compared with $1.88 in 2016.
Next week, The Stars Group will prepay without penalty an additional $75-million under its second lien term loan using cash on the balance sheet and cash flow from operations. Following this prepayment, The Stars Group will have repaid $115-million of its second lien debt thus far in 2017, resulting in a total reduction in annual interest expense of approximately $9.5-million, and reducing the principal balance of the second lien term loan to $95-million.
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Karen Baxter condensed this news release (firstname.lastname@example.org).
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