Super Group hits record revenue, deal to acquire platform revealed

Super Group’s revenue total for Q1 is 5.4% up on the €359.9m generated in the final quarter of 2024. It was also a 12.1% hike on the first quarter of 2023.

Super Group attributed the rise in revenue to growth in Africa and North America. Super Group’s Africa and Middle East revenue was 58.9% up year-on-year, while North America’s figure was an 8.2% rise. Africa now accounts for 38% of Super Group’s revenue from 27% in Q1 2023. However, Super Group did note decreases in its Middle East and Asia-Pacific markets.

Super Group announced a profit of €41m for Q1. However, that included a pre-tax gain of €40.1m from the sale of the B2B division of Digital Gaming Corporation (DGC) to Games Global, as well as a non-cash charge of €13.1m for change in fair value of option liability.

Adjusted EBITDA, meanwhile, reached €46.5m for Q1. That is 28.8% up from the €36.1m accumulated in the same quarter last year. This is also a 38.4% increase on the €33.6m generated in Q4 of 2023. Super Group accumulated €68.7m in adjusted EBITDA when excluding its US sector, which reported an adjusted EBITDA loss of €22.3m.

Super Group chief executive Neal Menashe lauded the company’s ability to continue its momentum from the end of 2023.

“This robust performance has been delivered by our global team’s ongoing focus and investment into core markets that are yielding strong returns, providing us with a solid foundation for the remainder of the year,” Menashe said.

Super Group looking to acquire sportsbook software

Super Group announced it has entered definitive agreements to fully acquire its sportsbook software technology. Apricot, Super Group’s software partner, currently licenses the sportsbook.

To acquire the platform, Super Group has reached an agreement with Apricot’s licensor. The deal involved a total consideration of €140m, as well as additional amounts payable if certain earn-out conditions are met. Additional payments of up to €210m could potentially be paid if Super Group’s sportsbook revenue doubles or more before the end of 2035. That earn-out would be calculated as a percentage of Super Group’s monthly sportsbook net gaming revenue.

Super Group will pay an initial consideration of €100m in the form of the cancellation of an outstanding loan. Additionally, Super Group will pay €40m in two equal amounts over the next two years. Up to €20m of that could be paid in ordinary Super Group shares at the company’s discretion.

Super Group previously stated it had opened talks to acquire its sportsbook platform back in 2022. The company outlined it couldn’t give assurances on reaching an agreement, although it has now managed to do so.

The deal brings Super Group closer to its objective of fully owning its sportsbook technology. It also gives the company the ability to apply the technology stack to its future properties.

Menashe is excited for the potential of the deal, stating: “This is an exceptional opportunity for Super Group to take full control of our sportsbook technology, which would enable maximum flexibility for organic growth as well as M&A opportunities.

“We’ll continue to deliver the best sports betting and gaming experience to our customers around the world as the benefits of this deal are realised.”

The deal is subject to supplemental licensing from regulators. Those approvals are predicted to take between six and 12 months to happen.

Betway online casino rises as sports betting falls

Betway’s total revenue over Q1 was €222m as rises in its online casino segment offset decreases in sports betting and brand licensing.

Sports betting revenue was €76.8m, a 5.7% decrease on the €81.4m generated in the same quarter last year. Meanwhile, brand licensing revenue fell 33% to €5.9m.

However, Betway’s online casino sector reported revenues of €135.3m. This was 31.4% up on the €103m accumulated in the same quarter last year. Online casino accounted for 60.9% of Betway’s total Q1 revenue.

Super Group’s casino brand Spin also saw its revenues increase year-on-year, reaching €156.9m from €140.2m in Q1 of 2023.

Monthly active customers across Super Group’s brands increased 33% to 4.7 million during Q1 from 3.5 million in the same period last year.

Super Group optimistic for the future

Cash and cash equivalents as of 31 March stood at €289.2m from €241.9m at the close of 2023. Super Group attributed the rise to inflows from operating activities of €69.8m. Meanwhile, outflows from its investing activities of €20.4m were largely down to further investment in assets, as well as the issuing of a €10m loan to Apricot Investments.

Both Super Group’s direct and marketing expenses rose to €303.9m from €275.7m in Q1 2023, while general and administrative expenses also hiked to €39.2m from €36.6m. However, depreciation and amortisation expenses dropped to €19.9m.

When announcing the company’s 2023 results, Menashe stated that the company was eyeing double-digit top-line growth for 2024. For 2024 guidance excluding the US, Super Group is looking for a total revenue increase of 10% to €1.6bn, as well as a net revenue rise of 12%.

Chief financial officer Alinda van Wyk believes the company’s focus on streamlining its business is paying dividends.

“Our laser focus on creating a leaner, more efficient operating model has delivered results, with Q1 operating expenses as a percentage of net revenue falling to below 19%,” Van Wyk explained.

“Investment into high-growth areas of the business continues at pace and we remain confident that we are in a strong position to realise our goals set for 2024.”