Peel Hunt, a prominent brokerage firm, has reaffirmed its positive stance on Gaming Realms PLC, maintaining a 'buy' recommendation and a 60p price target. This decision comes in the wake of the company's pre-close trading update, which highlighted another year of robust financial performance with double-digit growth in both revenue and profit. The key driver for this impressive growth has been the company's continued momentum in the United States market.
The financial results for the past year indicated approximately a 10% increase in revenue and a roughly 15% rise in adjusted EBITDA. This strong performance was predominantly fueled by a substantial 23% surge in US revenues, calculated at constant exchange rates, which now constitute a significant 61% of the group's total revenue. In contrast, the UK market experienced a revenue decline, attributed to new staking limits implemented in April 2025; however, this adverse effect is gradually diminishing. Peel also observed a minor £0.4 million impact on EBITDA due to foreign exchange fluctuations, leading to a slight adjustment of its FY25 estimate by £0.5 million and a 5% trim to FY25 EPS, while FY26 forecasts remain unchanged.
Looking ahead, Peel views the risks associated with the UK market as increasingly marginal, projecting that the UK will contribute only 16% of core revenue by FY27. The brokerage also noted that recent duty increases in the UK had already been factored into its financial models. Gaming Realms' strategic strength lies in its widespread geographical reach and diversified partnerships, with its content now available in 30 regulated markets and the popular Slingo portfolio benefiting from an expanding network of global licensees, underscoring its resilient business model.
Gaming Realms' journey exemplifies how strategic market focus and agile adaptation to regulatory changes can lead to sustained success. By capitalizing on global expansion opportunities, particularly in high-growth regions like the US, and effectively mitigating challenges in more mature markets, the company continues to build a strong foundation for future prosperity. This proactive approach not only drives financial growth but also reinforces the importance of innovation and diversification in a dynamic industry.