(Reuters) - Spanish gambling company Cirsa said on Tuesday its second quarter net profit fell 11%, as its casino business was hit by what it called an "unusually adverse" foreign exchange effect.
Cirsa Anticipates Reduced FX Impact in H2 as Online Revenue Surges
Cirsa's Financial Outlook and Business Performance
By Javi West Larrañaga
Impact of Foreign Exchange Rates
(Reuters) - Spanish gambling company Cirsa said on Tuesday its second quarter net profit fell 11%, as its casino business was hit by weakness in the Mexican and Colombian pesos though its online betting unit soared.
Growth in Online Betting Revenue
Foreign exchange headwinds, however, were not expected to continue throughout the rest of the year, Chief Financial Officer Antonio Grau said in a call with analysts.
Company's Market Performance
"Unless there are big changes ... I expect a lower (FX) impact in Q3 and Q4," Grau said, adding that it depended on the dollar's valuation.
Cirsa's quarterly net profit stood at 9.7 million euros ($11.43 million) in the quarter, down from 10.9 million euros a year ago. The company, which operates casinos and betting platforms in Spain, Portugal, Latin America, Italy and Morocco, booked a foreign exchange loss worth 16 million euros in the quarter.
Colombia and Mexico are very important countries for the company and the negative performance of their currencies relative to the euro dragged the casinos down, a spokesperson for Cirsa said.
Barcelona-based Cirsa reiterated its full-year guidance, saying it expects its core profit to grow by 6% to 7% compared to last year's.
Weakness in casinos was partly offset by its online betting business, which grew 64% year-on-year in terms of revenue.
Shares in the company were up 1.9% in morning trading after rising as much as 3.4% earlier in the session.
The company, which is controlled by behemoth private equity Blackstone, has in recent years focused on online gambling to follow the changing trends of the gambling industry.
Cirsa was listed in July by Blackstone in an IPO which valued the company at 2.52 billion euros. The fund kept a 78% stake in Cirsa.
($1 = 0.8490 euros)
(Reporting by Javi West Larrañaga, editing by Inti Landauro, Alexandra Hudson)
