DAVY VIEW

A strong start to the year and more resilient trading through the disrupted period suggest that GVC is better positioned to withstand the current period of uncertainty. With cost savings expected to halve the estimated P&L impact and limit cash outflow to a maximum of £15m per month, liquidity, leverage and broader balance sheet strength all appear better than previously feared. Despite this, the group has withdrawn its final 2019 dividend. In relation to estimates, its updated guidance suggests that each month of disruption will reduce our prior EBITDA expectation by a mid-single-digit percentage amount. The shape of our 2021F forecasts remains more difficult to assess for the time being.