REG - GVC Holdings PLC - Notification of Transfer to a Premium Listing <Origin Href="QuoteRef">GVC.L</Origin> - Part 12
01/07/2016 07:07
- Part 12: For the preceding part double click ID:nRSA8980Ck
sensitivity analysis that measures the change to the fair value of the Group's financial
instruments arising from a 10% strengthening or weakening in the reporting currency against all other currencies from the
rates applicable at 31 March. The Group is exposed to currency movements in the euro, arising out of changes in the fair
value of financial instruments which are held in non-euro currencies. This analysis is for illustrative purposes only, as
in practice, market rates rarely change in isolation.
Whilst the Group is exposed to interest rate movements since it holds significant amounts of cash at floating rates as well
as cash equivalents and other assets to meet client liability obligations that are non-interest bearing), the exposure is
actually not significant as the Group's interest bearing assets and liabilities are naturally hedged. Therefore, interest
rate sensitivity analysis has been omitted from the table below.
The amounts generated from the sensitivity analysis are estimates of the possible impact of market risk, assuming that
specified changes occur. Actual results in the future may differ materially from these results due to other developments in
financial markets that may cause fluctuations in interest and exchange rates to vary from the hypothetical amounts
disclosed in the following table, which therefore should not be considered as a projection of likely future events and
losses.
(Decrease) increase in fair value of financialinstruments Impact on earningsgain (loss)
31 March 31 December 31 March 31 December
2016 2015 2016 2015
Emillion Emillion Emillion Emillion
10% weakening in the reporting currency (0.4) (2.3) (1.1) (1.8)
10% strengthening in the reporting currency 0.4 2.5 1.2 1.9
Insurance
The Group purchases insurance for commercial or, where required, for legal or contractual reasons. The Group also retains
certain insurable risk where external insurance is not considered an economic means of mitigating these risks.
29. Share-based payments
31 March
31 March 2015
2016 (Unaudited)
Period ended 31 March Emillion Emillion
Total Shareholder Return based 1.0 0.9
Clean EBITDA / Clean EBITDA growth based 0.4 0.9
Other 0.4 1.2
Associated taxes 0.1 0.0
1.9 3.0
Due to the acquisition by GVC there was an acceleration of the vesting of share options resulting in an increased
share-based payments charge in 2015 and 2016 prior to the acquisition. Included within the share-based payments charge and
current liabilities is E0.8m (2015: Enil) related to cash-settled share options that would otherwise have been settled in
shares. Following the acquisition of the business by GVC on 1 February 2016, all shares outstanding at the time
automatically vested and were able to be sold. Additionally all plans were then closed and no new shares will be granted
under any of the plans.
Valuation basis
The Group previously granted awards as a reward and retention incentive for employees, including the Executive Directors.
The Group used the Black-Scholes option pricing model to value these options unless the Monte Carlo option pricing model
was deemed more appropriate. An appropriate discount was applied to reflect the fact that dividends were not paid on
options that were not vested or had not vested and had not been exercised.
bwin.party digital entertainment plc 2014 Incentive Plan ('BIP')
The BIP was approved by the Company's shareholders on 24 February 2014 and succeeded the Bonus Banking Plan ('BBP') and
Value Creation Plan ('VCP'), which reached the end of their three year period of operation on 31 December 2013. The BIP was
split into two separate elements. Element A was virtually identical to the BBP except with a reduced maximum annual
contribution (250% instead of 300%). Element B of the BIP, which replaced the VCP, allowed for the annual grant of
restricted shares dependent on the extent to which the Company completed strategic and transformational objectives during
the previous year, these projects having been set by the Remuneration Committee at the beginning of that previous year. Any
award made under Element B was made in the form of a restricted share award or nil-cost share option. The shares previously
vested on the third anniversary of grant, but were only eligible for sale on the fifth anniversary of grant although,
following the acquisition by GVC, all shares vested and were eligible for sale.
Period ended Year ended
31 March 31 December
2016 2015
BIP million Million
Outstanding at beginning of period 6.2 3.1
Shares over which options granted during the period - 3.7
Shares in respect of options lapsed during the period - (0.3)
Exercised during the period (6.2) (0.3)
Outstanding at end of period - 6.2
Exercisable at the end of period - 0.0
Shares over which options granted during the period (number) - 3,727,742
Percentage of total issued share capital - 0.45%
Weighted average remaining contractual life of options outstanding upon satisfaction of performance conditions where relevant (days) - 32
Bonus and Share Plan ('BSP')
The BSP plan also covered a three year period with annual performance targets set at the beginning of each year. If the
targets were met the participant would receive nil-cost share-options which vested in equal instalments over the next three
years. Following the acquisition of the business all
Period ended Year ended
Bonus and share plan 31 March 31 December
2016 2015
Period ended 31 March million million
Outstanding at beginning of period 1.2 1.5
Shares over which options granted during the period - 1.3
Shares in respect of options lapsed during the period - -
Exercised during the period (1.2) (1.6)
Outstanding at end of period - 1.2
Exercisable at the end of period - 0.3
Shares over which options granted during the period (number) - 1,312,320
Percentage of total issued share capital - 0.16%
Weighted average remaining contractual life of options outstanding upon
satisfaction of performance conditions where relevant (days) - 32
Other share plans
All other share plans fully vested on acquisition by GVC and were exercised.
bwin.party Rollover Plan
These options were granted as a result of the Merger to replace the existing bwin options at the time using the same
exchange ratio as for Shares. They are subject to the original vesting conditions and have no performance conditions. No
new awards are to be granted under this plan.
Global Share Plan ('GSP')
Awards of free shares worth up to a maximum of £25,000 (or equivalent) may be made to each eligible employee each year. The
award may be subject to performance conditions. There is flexibility to grant different types of free share award including
nil-cost options, conditional awards of shares and restricted shares where the employee is the owner of the shares from the
date of award.
Additionally, where employees buy shares up to a maximum of £1,500 each, they may be awarded additional free shares on a
matching basis, up to a maximum of two matching shares for each purchased share. Purchased shares must be held for a
minimum of three years for the matching shares to vest.
Directors are not eligible to receive any awards under this plan.
FMV Plan
Options granted under this plan during the period generally vest in instalments over a three year period. There are no
performance conditions attached to options issued by the Group under the terms of the FMV Plan. Directors are not eligible
to receive any awards under this plan. No new awards are to be granted under this plan.
Nil-Cost Plan
These options are not generally subject to performance conditions as this is regarded as detracting from their attraction
and retention capabilities and instead usually vest on a phased basis over a four to five year period. No new awards are to
be granted under this plan.
bwin.party
rollover plan GSP plan FMV plan Nil-Cost plan
Number Number Number Number
Period ended 31 March 2016 million million million million
Outstanding at beginning of period 18.9 7.3 0.9 0.2
Shares over which options granted during
the period - - - -
Shares in respect of options lapsed during
the period - - - -
Exercised during the period (18.9) (7.3) (0.9) (0.2)
Outstanding at end of period - - - -
Exercisable at the end of period - - - -
Shares over which options granted during
the period (number) - - - -
Percentage of total issued share capital - - - -
Weighted average remaining contractual
life of options outstanding upon
satisfaction of performance conditions
where relevant (days) - - - -
bwin.party
rollover plan GSP plan FMV plan Nil-Cost plan
Number Number Number Number
Year ended 31 December 2015 million million million million
Outstanding at beginning of period 20.6 6.5 2.2 0.2
Shares over which options granted during
the period - 6.1 - 0.0
Shares in respect of options lapsed during
the period (1.5) (0.5) (1.3) -
Exercised during the period (0.2) (4.8) - -
Outstanding at end of period 18.9 7.3 0.9 0.2
Exercisable at the end of period 18.9 2.5 0.9 0.2
Shares over which options granted during
the period (number) - 6,099,466 - 26,880
Percentage of total issued share capital n/a 0.7% n/a 0.0%
Weighted average remaining contractual
life of options outstanding upon
satisfaction of performance conditions
where relevant (days) 32 32 32 32
30. Dividend
The Board is not recommending any dividend during the period and no interim dividends were paid during the period ended 31
March 2016.
31. Non-controlling interests
Non-controlling interests comprise a 10% holding in bwin.party entertainment (NJ) LLC, a company incorporated in the United
States. The loss attributable to the non-controlling interest in the period was E0.1m (Year ended 31 December 2015:
E0.8m).
It previously also included a 28% holding in BES S.A.S, a company incorporated in France. This minority shareholding was
acquired on 8 July 2015 for E8.8m with the accumulated losses of E6.5m attributable to this non-controlling interest
transferred to retained earnings.
The balance of retained earnings attributable to non-controlling interests is disclosed in the table below:
Emillion
As at 1 January 2015 7.0
Loss attributable to non-controlling interests 0.8
Transferral of minority interests on acquisition of minority interests (6.5)
As at 31 December 2015 1.3
Loss attributable to non-controlling interests 0.1
As at 31 March 2016 1.4
32. Ultimate controlling party
Following the acquisition of the Company on 1 February 2016 the immediate controlling party was GVC Holdings Plc. In the
opinion of the Directors there is no ultimate controlling party.
33. Post balance sheet events
On 19 April 2016 the Group agreed to dispose of its interest in Conspo for at least E15.5m with additional consideration
due to the Group for certain working capital adjustments. A profit will be realised on the carried value of the asset of
approximately E11.6m.
On 22 June 2016 the Group received initial cash consideration of E6.5m in respect of the disposal of the investment in Visa
Europe Limited.
Glossary
'Active player days' aggregate number of days in the given period in which active players have contributed to rake and/or placed a wager. This can be calculated by multiplying average active players by the number of days in the period
'active player' or 'active real money' in relation to the Group's products, a player who has contributed to rake and/or placed a wager
'average active players' or 'Daily average players' the daily average number of players who contributed to rake and/or placed a wager in the given period. This can be calculated by dividing active player days in the given period, by the number of days in that period
'B2B' business-to-business
'B2C' business-to-consumer
'Board' or 'Directors' the Directors of the Company
'bwin' bwin Interactive Entertainment AG, its subsidiaries and its associated companies
'bwin.party' bwin.party digital entertainment plc, the name of the Group formed by the Merger of PartyGaming Plc and bwin Interactive Entertainment AG
'bwin.party Shares' the Company's existing Shares and the new shares issued to the bwin shareholders in conjunction with the completion of the Merger
'Cashcade' Cashcade Limited and its subsidiaries
'Clean EBITDA' EBITDA adjusted for exchange differences, reorganisation expenses, income or expenses that relate to exceptional items, and non-cash charges relating to impairments and share-based payments
'Company' or 'PartyGaming' or 'bwin.party' PartyGaming Plc prior to completion of the Merger and bwin.party digital entertainment plc ('bwin.party') after the Merger. Following the takeover by GVC, the Company reregistered as bwin.party digital entertainment Limited.
Conspo The Group's investment in Sportsman leisure industry solutions Gmbh (previously known as Conspo Sportcontent Gmbh)
'EBITDA' earnings before interest, tax, depreciation and amortisation
'Employee Trust' the bwin.party Shares Trust, a discretionary share ownership trust established by the Company in which the potential beneficiaries include all of the current and former employees and self-employed consultants of the Group
'Foxy Bingo' www.foxybingo.com, one of Europe's largest active bingo sites that was acquired as part of the purchase of Cashcade
'Gioco Digitale' www.giocodigitale.it, one of the Group's principal bingo websites
'gross win margin' gross win as a percentage of the amount wagered
'gross win' customer stakes less customer winnings
'gross gaming revenue' or 'GGR' gross win added to rake
'Group' or 'bwin.party Group' the Company and its consolidated subsidiaries and subsidiary undertakings
'GVC' GVC Holdings Plc
'IAS' International Accounting Standards
'IASB' International Accounting Standards Board
'IFRS' International Financial Reporting Standards
'InterTrader' Our financial markets service, operating on Intertrader.com and Intertraderdirect.com
'Kalixa' The Group's payments business
'KPIs' Key Performance Indicators such as active player days and yield per active player day
'Merger' the merger of bwin Interactive Entertainment AG and PartyGaming Plc that was completed on 31 March 2011, accounted for under IFRS 3 as an acquisition of bwin
'new player sign-ups' new players who register on the Group's real money sites
'partycasino' www.partycasino.com, the Group's principal casino website
'partypoker' www.partypoker.com, the Group's principal poker website
'player' or 'unique active player' Customers who placed a wager or generated rake in the period
'POCT' Point of Consumption Tax, the tax introduced by the UK Gambling Commission in 2014 on all bets made by UK customers
'PXP' PXP Solutions Limited
'rake' the money charged by the Group for each qualifying poker hand played on its websites in accordance with the prevailing and applicable rake structure
'real money sign-ups' or 'sign-ups' new players who have registered and deposited funds into an account with 'real money' gambling where money is wagered, as opposed to play money where no money is wagered
'Shareholders' holders of Shares in the Company
'Shares' the ordinary shares of 0.015 pence each in the capital of the Company
'sports betting' placing bets on sporting events
'wager' a bet on a game or sporting event
'WIN' the Group's Social Gaming business unit established in May 2012
'WPT' The World Poker Tour
'yield per active player day' net revenue in the period divided by the number of active player days in that period
This information is provided by RNS
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