M&A Proven track record in delivering value from successful M&A Target identification • Dedicated M&A team • Global brands and presence create a rich flow of opportunities • Strategically disciplined Optimal deal structures • Highly flexible approach • Innovative deal structures • Partnership approach – a platform for entrepreneurial businesses Successful execution • • Successful integration of people and cultures Improving growth in acquired businesses • • Brand revitalisation Synergy delivery • • Retaining top talent System migration 13
Brands Well-established brands increase marketing efficiency and create barriers to entry 14
Quality of Earnings Vast majority of online revenues are generated in fast growing, regulated and taxed markets % of GVC FY18 Online NGR in countries… …that are …where the …where GVC …if taxed, …with online either online market is growing then are penetration taxed 1 at 15% regulated, is growing >10% pa currently less >5% pa regulating or more than 20% (ex UK) and/or taxed 98% 95% 92% 90% 81% Source: H2GC 15 1 Sports-betting and gaming duty or equivalents
Quality of Earnings: Product Diversification Revenues are well diversified by product, with football revenues spread over multiple leagues and bet type Group Online NGR Product Splits (2018) Remainder includes other Football by leagues League each <3% l World Cup 9% l Premier League 8% Gaming Sports l Spanish La Liga 5% l UEFA Competitions 5% 56% 44% l German Bundesliga 4% l Italian Serie A 3% Remainder Football by l Casino & Games l Football Prematch includes other 45% 9% Bet Type bet types l Poker l Football BiP 5% 12% each <3% l Bingo l Horse Racing 3% 12% l Other l Tennis Prematch 3% 1% l Tennis BiP 4% l Match Betting 36% l Other Sports Prematch l Number of Goals 2% 34% l Team Goals l Other Sports BiP 6% 4% l Double Chance 3% Diversification significantly reduces gross win margin volatility 16
Our Approach to Responsible Gambling Decisive action to improve player protection – we have a plan and are making good progress GVC call for action in the UK Increase in GVC funding for research, education Industry-wide ban on UK TV sports-betting adverts and treatment from 0.2% to 1% of UK GGR (excluding horse racing) at any time of the day (£4m to £20m) by 2022 Setting up an independent trust to fund Provide blocking software to customers treatment centres across the UK free of charge Applying learnings Working together as an industry Working with regulators across territories Sustainable and effective player protection framework Changing the narrative 17
Key Messages GVC is a truly global operator, gaining market share in all major territories The GVC operating model is highly effective and is a sustainable competitive advantage; we are exceptionally well placed for future growth Continued outperformance is driven by operational excellence 18
Integration, Technology & Product Shay Segev Co-COO 19 GVC Holdings PLC | Capital Markets Day | 16 May 2019
Introduction Agenda Shay Segev - Integration update Picture - Technology Co-COO - Product development Previous sector roles Joined 13 years within Previously include: GVC as COO the online Chief Strategy Officer • Playtech - COO in February 2016 gaming sector Gala Coral • Videobet - CEO 20
Key Messages Integration progressing well and driving business performance; accelerated platform migrations will unlock value Proprietary technology platform is a unique competitive advantage and growth driver Leading product range continuously enhanced and deployed across brands and territories + + + + TECH PRODUCT BRANDS MARKETING PEOPLE KEY ENABLERS (Covered in this section) LOCAL EXECUTION 21
Proven Integration Approach Track record of highly effective integrations using a proven process Integration always focused on revenue growth and efficiency improvements, not just cost synergies Delivered multiple successful integrations Significant experience in delivering technology/platform migrations – 23 successful platform migrations over last six years – 20m customers migrated to GVC platform without incident Holistic integration approach drives performance improvements e.g. – 2016: bwin.party turnaround delivered £125m synergies while accelerating growth – 2019: Foxy Bingo migration to GVC platform (Nov 2018) - six months later +40% monthly YoY NGR growth Proven approach: Clear Targets Solid Structure Rigorous Execution Define end-state Strong people Financial transparency operating model Clear ownership Executive focus Manage by KPIs Lean and effective Pragmatic decision Focus on quick wins governance process making 22
Ladbrokes Coral Integration: Status Update Integration progressing well without disrupting growth; accelerated £15m platform migration synergy in 2020 Ladbrokes Coral brands growth boosted by immediate improvements in product, platform and operations Focus on technology integration and preparation of online business migration; Playtech agreement provides flexibility Detailed integration plans in place for all other areas All synergy targets delivered to date; accelerated £15m platform migration synergy in 2020 (2020 total now c£72m) Main Integration Areas Technology Marketing Operations Corporate and Product (HR, Finance, Facilities, etc.) Delivering run-rate of £130m cost synergies and at least £30m capex synergies by 2021 23
Integration: Immediate Value Drivers Major opportunity exists from sharing “best -of- both”; quick wins implemented but we have barely scratched the surface Examples of sharing to date: Trading Shared Gaming Content • • GVC odds-feed into Ladbrokes Coral – increasing Ladbrokes Coral in-house content available on GVC brands; Playtech content to follow from Q2 2019 product range and delivering operational synergies • • Shared trading performance models – driving GVC content (in-house and third-party games) increasingly available on Ladbrokes Coral UK brands improved risk management and increasing margins Customer Service Marketing • • Roll-out of the Coral Digital Marketing Platform to Implementation of GVC agile approach and best practices to Ladbrokes Coral customer service bwin Germany in Q4 2018 • • Enables enhanced customer segmentation and Resulting in significant performance improvements in tailored CRM customer response times (phone, chat, KYC) • First step in sharing of powerful marketing capability between GVC and Ladbrokes Coral Significant further opportunity exists across the business 24
Integration: Platform Migration Smart migration approach minimises risk and ensures a smooth user experience and seamless switch over Phased approach by brands – Wallet and gaming platform migration to GVC (Gala Spins in April 2019) Smart – Introduction of price feeds from in-house GVC sports (already started) Approach – Full migration to GVC in-house sports Fully co-ordinated with Playtech Minimal UX changes Smooth transition for players London Migration to GVC wallet Vienna Sofia New Jersey Gibraltar Rome/ Tel Aviv Starting Q2 2019 through to H2 2020 Milan Migrated April 2019 Material cost savings Improved performance and stability Significant Improved operational efficiency (best practice implementation, single toolset, Benefits unified processes) Global product platform advantages: build once, deploy multiple times Faster migration results in accelerated £15m synergies being recognised in 2020 25
Technology: Sustainable Competitive Advantage Powerful proprietary technology means we are in control of our destiny Sustainable Competitive Advantage OMNI-CHANNEL DEVICES Growth ready – highly scalable Quick to market API SERVICES Rapid deployment of changes Multi-jurisdiction 2 WAY INTEGRATION SERVICES compliant Seamless interaction between all components SPORTS CASINO POKER BINGO Highly stable and secure Cost efficient operation PLAYER MANAGEMENT SYSTEM and development SUPPORTING ECO SYSTEM TOOLS Integrated retail and omni-channel solution Fully integrated Full Cutting-edge Fully integrated Fully equipped All aspects are acquisition and product front-end proprietary supporting in-house CRM suite technology tech platform tools technology Ownership of a multi-territory fit for purpose sportsbook is a major differentiator – very difficult for competitors to replicate 26
Technology: Sustainable Competitive Advantage In-house technology enables rapid action and deployment Case Study 1: Processing (p.a.) Significant >350m sports bets Scale >10bn casino spins 2018 integration of GVC sports and gaming into Crystalbet >1bn poker hands Currently supports: 11 April 30 April 14 May 28 May 66+ front-ends Integrated GVC’s sports Acquisition Integration 300+ games added Flexible feed into Crystalbet’s sports complete commences 33 languages platform 2 weeks 42 currencies 4 weeks 99.93% service availability Availability 65+ changes deployed Case Study 2: per day Resource 1100+ IT staff 2018 integration of Stadium sports-betting platform into GVC platform Core locations in Backed Hyderabad and Vienna 20 Aug 20 Sept 4 weeks Integration Stadium sports-betting commences app fully integrated Rapid deployment with GVC platform M&A Enabler and synergy creation 27
Product Development Capability Extensive product development capability ensures a strong pipeline of new product and customer UX enhancements In-house Games, Third-party Games Sports Product Bingo and Poker and Live Casino Development Customer interface and user experience Industry-leading expertise London Vienna across all domains Tbilisi Sofia New Jersey Common product Gibraltar Rome/ Tel Aviv development approach Milan Global, scalable products Hyderabad Fast roll-out High local market relevance Brisbane Global product development organisation co-located with regional marketing teams Platform migration will further enhance the ‘develop once, deploy multiple times’ principle 28
Recent Product Development Continual improvements to product offering and customer user experience video 29
Going Forward Deliver integration with platform migrations from H2 2019 Accelerate growth and step- up “best -of- both” sharing into 2020 Proprietary technology driving significant benefits across the Group 30
GVC Brands Adam Lewis CMO – GVC Brands 31 GVC Holdings PLC | Capital Markets Day | 16 May 2019
Introduction Agenda Adam Lewis - Marketing strategy CMO – GVC - bwin Germany - partypoker Brands - Crystalbet Led the marketing Joined 26 years 18 years within turnaround International marketing the online GVC as CMO of Sportingbet (2013) and experience gaming sector in January 2013 bwin.party (2016) 32
Key Messages Highly effective operating model driving market share gains Sophisticated marketing techniques applied across territories Deep local expertise enabling deployment of territory-specific operating models + + + + TECH PRODUCT BRANDS MARKETING PEOPLE KEY ENABLERS (Covered in this section) LOCAL EXECUTION 33
Brands and Scale Diverse brand portfolio across wide geographical footprint • Operates in over 20 countries • Delivers £1.0bn NGR • 51% of Group Online NGR 34
Performance Highly effective operating model delivering sustained outperformance +22% +20% +11% 3-Yr Growth Q1 2019 NGR +62% +21% Total NGR € m 2018 vs 2015 Year-on-year 2016 2017 2018 NGR 1 1 Constant currency 35
Marketing Strategy and Structure Eight specific marketing strategic pillars driving increased player engagement; growth underpinned by data and analytics Analytics and Insight Brand and Customer Creative Experience Marketing strategic pillars Each headed by a Digital Divisional Director CRM Marketing Dedicated budget Player engagement Specialist divisions Delivers cutting-edge Revenue divisions practice across all regions and all brands Regional Casino Sports Poker Data and Analytics Genuine player engagement is driving long-term revenue growth 36
Analytics and Insight Analytics and insight are the most influential enablers of sustained player engagement and growth Optimised Acquisition Personalisation Budget optimisation through data-driven Present the most relevant content at the targeted advertising right time, for CRM, onsite and offsite Customer DNA Next Best Action Real-time Targeting The right message, bonus, contact or Increase customer engagement through real-time communication and offers pre- strategy for each individual customer at any stage of lifetime match and in-play 37
Analytics and Insight Sophisticated infrastructure drives optimal customer engagement Application Layer Data Layer Customer DNA Analytics Layer Intelligence Layer Biddable Platforms Return on Marketing Mix Transactional Marketing Modelling Investment (ROMI) Web AdServing Predictive Modelling • Churn Customer Services Targeted Comms • ALV Next Best Action • CLV • Bonus Opt • VIP models Social & App • RG • X-sell CRM orchestration Personalisation Engine Real Time Triggers • Customer Data • AlwaysON Propensities Recommend. • Customer Engine DMP Movements Survey • Attribution Feedback Loop …Third Party • External data Measurement Layer… 38 Additional text here
Analytics and Insight Marketing analytics delivering tangible benefits in sector specific trials – wider deployment planned from H2 2019 onwards Digital • New customer first-3-months NGR +28% 1 • Data Marketing Platform implementation delivered 8% improvement in CPA 2 Marketing • New player deposit limit changes and payment type removals driving NGR growth (Player Acquisition) • Bonus per active cost improved by 7% 3 • Player frequency +11% and churn 8% 2 improvement CRM • Increased customer insight enables greater customer protection • Average games per player increased by 10% driving +15% NGR 4 Casino • Record 35% 5 of sports customers cross sold to Casino in their first month Marketing • Cost per acquisition (CPA) decreased 47% whilst one year player value increased by 38% 4 26 ongoing digital marketing analytics and insight projects 1 bwin Spain Q1 2019 YoY 4 partycasino Q1 2019 YoY 39 2 bwin Germany Q1 2019 YoY 5 All GVC sports brands Dec 2018 3 bwin and Sportingbet Greece Q1 2019 YoY
Making Customer Experience a Key Differentiator Consistently exceeding player expectations 2019 2020+ The customer Beyond satisfaction at the heart of Cultivate loyalty, not just everything satisfaction we do Customer Satisfaction Introduce CX metrics and focus Active listening Manage both the reality and perception through cognitive science Intentionally designed experiences Across all touchpoints Customer rich data insight Constantly listening to drive change Relevant and valued Memorable peaks that strengthen engagement Purposely designed E2E Journeys Persistent and consistent Live, seamless and in control Brilliant basics from a single voice 40
Brand & Creative: 2017 Bringing bwin Back to Life A breakthrough campaign delivering a Hollywood-style adrenaline fuelled car chase, allowing the audience to predict the outcome of the chase 32% 250,000 YoY 78% 35% predictions made increase in increase increase in new unique active on the result customers in NGR players of The Race 41
World Cup: 2018 One Campaign - Global Appeal If you want to be the best then work with the best! Campaign delivered an epic heist of the most famous football trophy in the world, with the four protagonists each hatching their plans across four separate adverts, with the campaign crescendo at the start of the tournament revealing…“Who Stole the Cup” 25% 41% 11.8m 44% increase in unique increase in new views on social media increase in NGR active players customers 42
2019: Leverage Our Key Assets Globally ‘Welcome to the BIG League’ A pan-European brand campaign leveraging bwin’s sponsorship of football giants Borussia Dortmund, Valencia, Inter Milan and Atletico Madrid, creating an emotional and aspirational connection with fans, welcoming them to bwin and to the ‘BIG League’ 43
2019: German Regional Campaign ‘This is our game’ DAS IST UNSER SPIEL “This is our game” – grassroots campaign setting bwin apart from the competition Building an emotional connection between bwin and authentic football by leveraging players and real fans including Borussia Dortmund, Koln, St Pauli, Dynamo Dresden, Union Berlin and the 3 rd Bundesliga 44
Introduction Stephan Heilmann Head of bwin Germany Joined as 15 years 11 years within Head of bwin Germany in marketing the German Online January 2016 experience gaming sector 45
Germany: Performance Market leading performance +23% +26% +18% Q1 2019 NGR +83% +26% Total NGR € m NGR growth since acquisition Year-on-year 2016 2017 2018 NGR 1 1 Constant currency 46
Germany: 2018 Brand Positioning Making the bwin brand authentic and passionate Authentic Passionate Factual Humorous Artificial 47
Germany: Current and Future Strategy Making bwin the standout No.1 sportsbook in Germany 2017 2018 2019 2020…2021…2022 48
LATAM LATAM double digit growth for the last five years ‘Welcome to the Big League’ Strong brand Proven & highly Q1 19 Growth recognition: Considering LATAM competent +48% expansion options sportingbet, bwin regional team and partypoker 49 49
partypoker Significant market share gains driven by leading live event offerings and continued UX enhancements Geographical Cash Games Ecology Expansion FastForward Prevention of Recent: Sweden animations third-party tools and Spain Short deck My game - poker Future: Italy and Real name Greece 42% 41% Product Live Events Enhancements Largest Recent: New Global Tour lobbies and new PPL Dollars Live tables YoY growth % Partnerships NGR GROWTH +128% 1 Future: Mobile Events and gamification 14% 2018 vs 2015 2016 2017 2018 Multi-table Recreational Recreational Increase ROI Tournaments Player Retention Player Acquisition Improve and Festivals Gamify Poker Spins Marketing Powerfest Offering Team Online Capabilities KO Series Optimove ATL Spend Monster Series Cycles Social Media 1 Constant currency 50
Crystalbet: Effective M&A Crystalbet performance demonstrates our effective M&A model – local expertise while leveraging Group assets +41% +61% +79% +76% Total NGR GELm Q4 2018 Q2 2018 Q3 2018 Q1 2018 NGR 1 +58% Q1 2019 vs Q1 2018 Existing Group BI, CRM and Enhanced casino New sports feeds Crystalbet acquisition product 8000 additional technology management 338 games added markets daily team combined increasing player with GVC assets acquisition & LTVs 1 Constant currency 51
Going Forward Rigorous focus on analytics, driving marketing efficiency Next phase in the radical evolution of the bwin brand Continue to leverage our extensive local expertise to drive market leading performance 52
UK Online Andy Hornby Co-COO 53 GVC Holdings PLC | Capital Markets Day | 16 May 2019
Introduction Agenda UK Online: - Market - Operating model Andy Hornby - Marketing Co-COO - Brands UK Retail: - Triennial Review update - Fit for the future Previous sector roles include: Previous roles include: • GVC Co-COO Ladbrokes Coral Group • 8 years within Alliance Boots – COO since the 2018 acquisition • the gaming sector Halifax/HBOS of Ladbrokes Coral • Gala Coral Group – • ASDA Chief Exec Coral 54
Key Messages The UK market is a well-regulated high growth market Market leading CRM and acquisition capability driving outperformance Multi-brand strategy presents further growth opportunity + + + + TECH PRODUCT BRAND MARKETING PEOPLE KEY ENABLERS (Covered in this section) LOCAL EXECUTION 55
UK Online Market UK market is still a high growth, well-regulated market dominated by scale operators with significant barriers to entry UK Online NGR Forecast Growth Total Online NGR (FY17) High single- digit growth l bet365 13.0% 7,000 18% l TSG 12.6% 16% l PPBF 12.5% 6,000 14% l GVC 12.2% 5,000 YoY Growth 12% l WH NGR (£m) 9.0% 4,000 10% l Jackpotjoy 3.4% 8% l 888 3,000 2.6% 6% l Kindred 2.0% 2,000 4% l Rank 1.8% 1,000 2% l Others 30.9% 0 0% 12.2% 2012 2013 2014 2015 2016 2017 2018E 2019E 2020E Total NGR YoY Growth Online Gaming NGR (FY17) Online Sports NGR (FY17) l bet365 l GVC 24.9% 13.6% l PPBF l TSG 21.2% 9.6% 13.6% l TSG l William Hill 16.4% 7.2% l William Hill l Jackpotjoy 11.4% 6.1% l GVC l PPBF 10.0% 5.9% l Others l bet365 16.1% 3.8% 10.0% l 888 3.8% l Rank 3.2% l Stride 2.5% l Kindred 2.5% l Tombola 2.2% l Others 39.6% Source: Gambling Compliance FY17 estimates 56
Driving High Growth Market leading growth in 2018 2018 Year-on-year Online NGR growth Sports-led brands Gaming-led brands 14% 11% 7% 6% 5% 3% 0% Lad/Coral Skybet PPBF WH Galabingo Rank JPJ Competitor 6 Competitor 1 Competitor 2 Competitor 3 Competitor 4 Competitor 5 -20% 1 Excludes acquisitions 57
Driving High Growth Outperformance continuing into 2019 Q1 2019 Year-on-year Online NGR growth Sports-led brands Gaming-led brands 15% different time period 8% Reported on a Not reported Not reported Competitor 1 Competitor 2 Competitor 5 Competitor 3 Competitor 4 Competitor 6 -1% -7% -12% 1 Excludes acquisitions 58
Marketing Tools Scalable real-time marketing engine delivering unique experience to each customer Models are highly accurate Bespoke predictive models include: Organic FTDs – Adj R 2 97% • pNGR : predicts 12 month player value • pVIP : predicts propensity for customer to become high value Predictive Actives • pChurn : predicts propensity of a customer to churn analytics models Week 1 Week 52 Existing Active Customers – Adj R 2 89% Macro and micro segmentations defining player cohorts: • Lifestage – e.g. early life, retained, churned • Preference – e.g Sports / Football / Horse Racing Behaviour Actives • Socio-demographic Segmentation models Week 1 Week 52 Reactivated Customers – Adj R 2 94% Real-time decisions defining next best offers: • Rules/activity based – e.g. Half Time market settles – > promote second market Actives • Browsing Behavior – e.g. Browse Rugby content – > change Next Best Offer banner offer to Rugby • Machine Learning/AI based models – suggest next best bet Models Week 1 Week 52 Actual Model prediction These models are unique IP – driving efficient and effective marketing 59
Marketing: Leading Real-time CRM Advanced marketing capabilities enable unique interaction with every customer Example customer interaction: Saturday – Cross-sell and up-sell Customer Profile Friday - Activation Offer Media Push • Customer A bets £100 per 15:00 Customer A sees 12:00 Customer A 16:10 Post half-time an ad on Racingpost.com that receives a bespoke Odds Customer A receives an week was purchased using offer for a second-half Boost as part of an anti- programmatic techniques. We churn campaign. Mobile bet on the Manchester • Has opted-in to all do not buy ads on this site for derby app is configured to communications non-horse racing customers promote this after they receive the push • VIP flag is set to medium notification Push • 20:10 : Real-time betting Flagged as favouring Push Email/ engine predicts that SMS 17:00: Customer A 13:00 Customer A football, but with a high Customer A will be bet on Spurs last week – receives an incentivised offer to propensity to horses and interested in El Classico. place a bet on the Saturday The real-time engine Customer A receives a occasionally bets on rugby 15:00 kick-off football match. sends a push notification push notification This offer is restricted to about the Spurs game “churning medium value” • ‘Bonus abuse’ flag is low this week customers • Clean Responsible Banner Gambling score – no 14:00 Customer A logs-in and browses the previous problem gambling Social rugby page. The on-site 19:00 Customer A sees an triggers banner is immediately ad on their Facebook feed for changed to “Rugby Offer” “1 -2- Free” free -play games at • pChurn model indicates Ladbrokes likely to churn 15:00 Customer A places a bet on the Manchester football derby Media 20:00 Customer A sees an ad on Racingpost.com that Push was purchased using 15:02 Customer A programmatic techniques. We receives a push do not buy ads on this site for notification advertising non-horse racing customers “1 -2- Free” free -play game Highly relevant personalised CRM drives increased customer retention 60
Marketing: Real-time CRM Advanced marketing capabilities are a competitive advantage 61
Marketing: Brand Brand differentiation reinforced through new campaigns ‘Where the nation plays’ ‘Don’t bet silly, bet savvy’ 62
Ladbrokes.com: Improving Profitability The on-going turnaround of the Ladbrokes online brand in the UK presents a significant opportunity Year-on-year quarterly NGR growth rate 38% Merger completion 36% 33% 29% 23% 21% 21% 18% 13% 11% 5% 2015 2016 2017 2018 -5% -6% -6% -7% -9% Q1 Q2 Q3 Q4 Annual marketing / 35% 26% 32% 26% NGR % Poor Inefficient reinvestment of marketing Corrective actions Recovery Performance Poor profitability Improved profitability Ladbrokes at merger completion (Nov 2016) Corrective actions: • Tired brand • High levels of marketing to reinvigorate brand Plugged in marketing models and real-time CRM • Poor ROI Marketing mix changes • Over dependence on affiliates New brand marketing launched ahead of the • Inefficient marketing channels & conversion World Cup • Low gaming cross-sell Team realignment to focus on separate brands 63
Marketing Efficiency Rigorous CRM and acquisition marketing driving material improvements in marketing ROI Driving higher marketing ROI Impact on ROI of applying these models to Ladbrokes.com Data Orchestration Improvement in ROI 1 Channel TV 1.3x + + Branded PPC 2.2x Non-branded PPC 1.1x Display 2.7x Print 1.0x Segmentation Execution Affiliate 3.1x Sponsorship 2.3x 1 Comparisons of market spend return on investment 2016 vs 2018 64
Coral.co.uk: Consistent Outperformance Coral.co.uk has consistently outperformed the market Year-on-year quarterly NGR growth rate 84% 65% 61% 54% 40% 33% 31% 30% 29% 21% 17% 13% 13% 13% 10% 8% 2015 2016 2017 2018 Q1 Q2 Q3 Q4 Growth driven by market leading CRM and continued improvements to user journeys and product offering 2014 2016 2018 • • • Launch of Coral Connect Migration to in-house mobile front- Real-time CRM capability deployed • • Exclusive ‘Build -Your- Bet’ product Cash-out launched end • • Launch of Coral Football Jackpot Increased range of exclusive in- launched • Innovative value offers eg : ‘Brazil to • house games Coral Live Casino studio launched Wear Yellow’ • Multi- channel loyalty ‘Bet and Get • Mobile app reskinned Club’ launched 65
Galabingo.com: Leading Growth Very high marketing ROI driving sustained growth Year-on-year quarterly NGR growth rate 41% 23% 21% 18% 17% 14% 12% 11% 10% 10% 9% 8% 6% 2% 0% 2015 2016 2017 2018 -8% Q1 Q2 Q3 Q4 2018 year-on-year Online NGR growth 66
Foxy Bingo: Turnaround Foxy brand awareness remains very high; turnaround plan underway JOIN THE FOXY FABULOUS. New TV campaign focusing on ‘The Foxy Fabulous’ with new • brand positioning and Foxy as the lead • Key partnership with exclusive products, bespoke TV and C5 sponsorship • New brand team managed from Gibraltar • Relaunch of VIP scheme • New GVC back-end enables richer promotional plan One brand, two worlds – Foxy Casino (rebranded Foxy Games) • will re-embrace the Foxy character to lead the brand • 40% YoY NGR growth in April 2019 67
Going Forward Further enhance real-time CRM capability to drive growth Leverage the benefits of operating on single Group technology platform Continued turnaround opportunity for Ladbrokes.com and Foxy Bingo 68
UK Retail Andy Hornby Co-COO 69 GVC Holdings PLC | Capital Markets Day | 16 May 2019
Triennial Review Update Six weeks trading since implementation of £2 stakes First six weeks vs model Key Model Assumptions expectations 1. B3 Migration - Some >£2 play will migrate to slots In-line 2. OTC Migration - Some displaced machines spend will migrate OTC Positive 3. Online Migration - Some displaced machines spend will migrate online In-line 4. Shop Closures - Losses will be capped by closing loss making units No update yet • Previous guidance was £120m fully mature EBITDA impact • Now expect to beat that guidance by c£15m from FY20 onwards 70
Fit for the Future: OTC / SSBTs / Machines Investment in machines, SSBTs, shop fabric and a new proprietary EPOS system leaves the business well positioned SSBTs Machines OTC • • • UK terminal density-per-shop to 6,800 Equinox machines rolled Market leading Best-Price- increase by 30% out across 1,700 shops Guarantee (BPG) all-day every- day • • New wide-screen terminals are Slots games launches continue • delivering strong double-digit at pace Multi-channel sign-ups >150% − 29 games launched in Q1 growth ahead YoY since launch of BPG − 24 games planned in Q2 • “Bringing the app experience • Multi-channel sign-ups >100% in- shop” ahead YoY across both brands during Grand National Q1 2019 LFL SSBT Q1 2019 LFL Machines Q1 2019 LFL OTC wagers NGR growth: +14% NGR growth: +4% growth: improved to flat 1 1 Includes SSBTs 71
Fit for the Future Leading offer on the high street Highly Cash Generative Reinforcing Brand Recognition Driving Online Growth Post Triennial (2022 onwards): • • Market leading multi-channel Retail presence key in driving offering is a material competitive overall brand recognition • Cash generation >£100m p.a. advantage • Steady OTC NGR decline partly • 2m+ Retail customers signed up offset by SSBT and slots growth to Connect and Grid • Rigorous focus on cost control • Multi-channel customers 2 contributed 14% of • ladbrokes.com and 20% of Increasingly relevant post TV coral.co.uk NGR advertising restrictions Total awareness of Online brands 1 Retail brands 80% 79% 78% 74% 72% 70% 69% Ladbrokes William Paddy Coral Bet365 Betfair Sky Bet Hill Power Competitive advantages in the battle for market share 1 Source: Betscope Q1 FY18 to Q4 FY18 72 2 Customers who have a Grid/Connect account who have registered/deposited in shop
Key Messages Triennial Review impact £15m better than expected from 2020 onwards Well-placed for market share gains A right-sized UK Retail estate is a core asset – driving online growth through unique multi-channel offerings and delivering cash 73
Break 15 minutes 74 GVC Holdings PLC | Capital Markets Day | 16 May 2019
US Adam Greenblatt CEO – ROAR Digital (US JV) 75 GVC Holdings PLC | Capital Markets Day | 16 May 2019
Introduction Agenda Adam Greenblatt - The opportunity CEO – ROAR Digital - The JV - Progress to date (US JV) - Technology and product Previous sector roles include: • Ladbrokes Coral – Previous roles include: CEO – US JV 16 years within Director of Corporate • Rothschild - Gaming since October 2018 the gaming sector Development and Practice Strategy • Stadium Technology – President 76
Key Messages The US is undoubtedly the largest sports-betting opportunity to emerge in the last 20 years Established brands, proprietary technology and market access will create a leading position in the US Clear JV roadmap exists + + + + TECH PRODUCT BRANDS MARKETING PEOPLE KEY ENABLERS (Covered in this section) LOCAL EXECUTION 77
The Opportunity US is expected to be an online-led market worth at least $6bn GGR by 2023; Roll-out is likely to be gradual, state-by-state and retail-first in some states ME WA VT NH MA MT ND MN NY OR RI ID WI MI SD CT PA NJ WY DE IA OH MD NE NV IN IL WV D.C. VA UT KY CA CO KS MO NC TN SC OK AR AZ NM GA MS AL AK TX LA FL Legend – legal sports betting: HI l Live in 2018 (8 states) l Live in 2019-2020 (11 states + DC) l Live in 2021-2022 (11 states) l Live after 2022 (16 states) l Unlikely to legalise (4 states) Source: Eilers & Krejcik – April 2019 78
The Opportunity: Live States Currently c10% of the US population can bet on sports through retail outlets and only c4% online State Population (m) % of US population Retail betting Online betting Online casino l l l Pennsylvania 12.8 3.9% l l l New Jersey 8.9 2.7% 1 l l l Nevada 3.0 0.9% l Mississippi 3.0 0.9% l New Mexico 2.1 0.6% l l l West Virginia 1.8 0.6% l l Rhode Island 1.1 0.3% 1 l l l Delaware 1.0 0.3% Total 33.7 10.3% l Sports-betting operational l Sports-betting legal but not yet operational l Enabling bill(s) pending Source: Eilers & Krejcik – April 2019 79 1 Poker only
The Opportunity: Regulatory Roadmap to 2021 Additional 11 states + DC, (c23% of population) expected to be regulated by 2021 State Population (m) % of US population Retail betting Online betting Online casino l l l New York 19.5 6.0% l l Illinois 12.7 3.9% l l l Michigan 10.0 3.1% l l Massachusetts 6.9 2.1% l l Indiana 6.7 2.0% l l Oregon 4.2 1.3% l l l Connecticut 3.6 1.1% l l Iowa 3.2 1.0% l l Arkansas 3.0 0.9% l l Kansas 2.9 0.9% l l New Hampshire 1.4 0.4% l l District of Columbia 0.7 0.2% Total 74.8 22.9% Total by 2021 108.4 33.1% l Sports-betting operational l Sports-betting legal but not yet operational l Enabling bill(s) pending Source: Eilers & Krejcik – April 2019 80
The JV: A Winning Combination Combination of established brands, proprietary technology and market access will create a leading position in the US Established brands Proprietary technology Online: GVC Technology Retail: GVC Stadium Technology Market access 19 states; expect to access all markets that regulate where commercially viable Efficient financial Proprietary technology + efficient marketing + market access = efficient cost model Target EBITDA margin of 30% model • 50/50 JV • All existing and future sportsbooks transferred to JV – current run rate NGR >$100m • 25 year agreement • Access to 32 million M Life members 81
Market Access The JV is well-placed with current access to 19 states; expect to enter every regulating state where commercially viable ME WA VT NH MA MT ND MN NY OR RI ID WI MI SD CT NJ PA WY DE IA OH MD NE NV IN IL WV VA D.C. UT KY CA CO KS MO NC TN SC OK AR AZ NM GA MS AL TX LA AK FL Legend – legal sports betting: l Live in 2018 (8 states) l Live in 2019-2020 (11 states + DC) l Live in 2021-2022 (11 states) HI l Live after 2022 (16 states) l Unlikely to legalise (4 states) l JV market access (19 states) Market access, technology and brand awareness are major barriers to entry. We expect the market to be dominated by a small number of scale operators Source: Eilers & Krejcik – April 2019 82
Operating Model NGR run-rate of over $100m across Retail, Online and B2B RETAIL ONLINE B2B Technology and product: proprietary, flexible, omni-channel sports and gaming platform SPORTS Trading: 600 traders globally, dedicated US-based team, proprietary trading models Marketing and BI: leveraging leading retail, online and omni-channel expertise Brands and assets: powerful brands and partnerships, well-invested retail assets, far-reaching customer database Responsibility: leading the way in Responsible Gambling Flexible model that is fully customisable state-by-state 83
Progress Since JV Formation Putting an optimal structure in place to capitalise on the long-term opportunity • Management team now in place : CEO, CMO, CTO, CHRO • Head office established in Exchange Place Jersey City, minutes from Manhattan • Hiring progressing well – current 70 FTEs • Dedicated technology delivery team in place ; H2 2019 roadmap agreed • Over 40 developers ring-fenced to focus on US requirements, in addition to the 1,100+ IT heads within GVC supporting the platform and shared elements • New Jersey launch in both retail and online (with limited marketing to date) • Market access commitments signed in California and Montana • Strategic partnerships with multiple sports leagues secured • Build-out of MGM retail sportsbooks progressing well 84
Technology Powerful proprietary technology is resource backed and provides operating leverage OMNI-CHANNEL DEVICES IOT MOBILE TABLET API SERVICES US Retail 2 WAY INTEGRATION SERVICES US Online US Online US Online Full US Online: H219 US Online (light) STADIUM SPORTS CASINO POKER BINGO SPORTS PLAYER MANAGEMENT SYSTEM SUPPORTING ECO SYSTEM TOOLS Stadium Sports Technology Fully integrated into the GVC technology platform Default US Retail solution – used by over 80% of sportsbook operators in Nevada Provides a ‘light’ online solution – current basis for JV offering in New Jersey Migration of online sports offering to the main GVC sportsbook in H2 2019 US Online sports offering migrated to the GVC technology sports platform in H2 2019 85
Roadmap: Product Full product range available to customers ahead of the new NFL season 86
Technology and Product Milestones Launch on the GVC technology platform in H2 2019 will significantly enhance offering In-play sports-betting on New sports-betting mobile mobile and desktop and desktop front-end Online sports- Borgata Sports on betting on desktop mobile and desktop GVC marketing and Additional BI tools deployment payment methods US core platform upgraded to the MGM NV Retail global version sportsbooks migration MGM MS Retail to GVC platform sportsbooks migration to GVC platform 30+ new casino MGM NJ Retail Sports affiliates games exclusive sportsbook migrated Full GVC platform deployment for the US market to GVC platform online sports platform deployment Start of 2019 NFL Season (September) 87
US Marketing Matt Prevost CMO – ROAR Digital (US JV) 88 GVC Holdings PLC | Capital Markets Day | 16 May 2019
Introduction Agenda Matt Prevost - Marketing strategy CMO – ROAR Digital - 2019 roadmap (US JV) Previous roles include: Previous sector roles CMO – US JV • 6 years within Cerberus include: • since January 2019 the gaming sector Avon - Chief Digital • Coral Interactive – CMO Officer • McKinsey & Co. 89
Marketing Strategy Building the foundation for growth; ready for the start of the 2019 NFL season Leverage powerful Highest awareness of Las Vegas resort operators at c90% MGM brand Extend MGM’s investment 50+ marketing deals including MLB, NBA, NHL and MLS in sports partnerships Leverage experience and tactics developed in the wider Group; predictive Develop data-driven analytics and real-time CRM marketing approach Connect land-based and online experiences; 7m+ annual guests at MGM Build omni-channel experience properties 90
Leverage Powerful MGM Brand Very high awareness of the MGM brand enables higher ROI acquisition spend • • Highest awareness among the Las Vegas resort operators (c90%) 32m+ M Life Rewards members • • Operates 8 of the top 12 brands in Las Vegas 7m+ annual guests at MGM properties • Significant regional properties in key markets “To Entertain the Human Race” 91
Leverage Powerful MGM Brand Very high awareness of the MGM brand enables higher ROI acquisition spend Video 92
MGM: Significant Commitment to Sports Driving awareness and loyalty through sports partnerships Billions of advertising impressions annually National Las Vegas Regional Hosted-events provide opportunities for VIP engagement as well as new player acquisition Pac 12 UFC Stanley Cup Canelo vs. GGG The Match NBA Summer League • A proud heritage: e.g. Tyson vs Holyfield, NBA All-Star, Mayweather vs Pacquiao • Wide range of sports in MGM properties: 35 live entertainment venues, 8,000+ events, 8m+ tickets sold annually 93
Building an Unmatched Omni-Channel Experience Efficient player acquisition and retention Customer Journey (Las Vegas example): MGM Guest 1 MGM Guest Reservation Reservation Online sports-betting introduced pre-arrival (Awareness) 1 2 MGM Guest Arrival Incentives to trial retail and online experience (Conversion) Return to MGM Home State Guest 3 MGM On-property Experience 5 2 7m+ Arrival Personalised experience from annual MGM welcome to VIP host (Retention) guests MGM Guest Checkout 4 Online extension of on-property experience (Retention) 4 3 5 Return to Home State MGM On- MGM Guest property Sign-up with home state Checkout Experience offering, extension of Vegas experience (Retention) Omni-channel customers at Borgata are 2.5x more valuable than online-only customers 94
Marketing Roadmap: Early Focus Activity will ramp-up considerably with product and retail sportsbook development • Invest in team development; continue to leverage GVC capabilities Capability • Integrate marketing efforts with MGM marketing campaigns Development • Build-out M Life points integration • Borgata • Launch Retail sportsbook; market-leading in Atlantic City New Jersey • Launch Borgata Online sports; integrated casino and sports • Launch repositioned MGM online brand • Launch new mobile app in market and increase marketing efforts • Expand off-strip deposit points and access for locals Nevada • Develop omni- channel experience; focus on tourist market and MGM’s 45,000+ rooms • Build-out retail sportsbook operation and marketing • Leverage Beau Rivage’s premium brand Mississippi • Commence online and omni-channel advertising 95
Going Forward Technology launched ahead of the NFL season, providing the full GVC product offering Full marketing deployment in H2 2019, leveraging Group expertise Further develop and capitalise on the omni-channel opportunity 96
Regulation and Responsible Gambling Rob Hoskin - Group Director of Legal and Regulation Grainne Hurst - Director of Responsible Gambling 97 GVC Holdings PLC | Capital Markets Day | 16 May 2019
Introduction Picture Picture Rob Hoskin Grainne Hurst Group Director of Legal Director of Responsible and Regulation Gambling Previous sector roles include: Group Director of Legal • Ladbrokes Coral – Director of Responsible and Regulation since Gambling Director Corporate 14 years within February 2016: previously since the 2018 acquisition Affairs the gaming sector held similar roles at • of Ladbrokes Coral Former Special Advisor bwin.party and in the David Cameron PartyGaming Government 98
Key Messages Regulatory agenda is broad; regulation can benefit scale operators with established brands Decisive action being taken by GVC on Responsible Gambling initiatives Positive direction of travel on German regulation 99
Regulation Summary Scale, diversification and multi-channel offerings are advantages in new markets and markets where regulation is increasing • Key themes: Regulating Advertising Responsible UK Germany Markets Restrictions Gambling • As a global operator we have a broad regulatory agenda (we operate licences granted in more than 20 countries) • GVC has unparalleled regulatory expertise, staying at the fore-front of developments • Regulation can be an opportunity • New markets opening up – e.g. US • Markets regulating – e.g. Brazil • Tighter regulations create barriers to entry, benefiting large established operators • Greater revenue stream certainty We are supportive of well-regulated markets 100
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