LatAm 70% uptick drives double-digit Betsson Q1 growth

Betsson reported an 18.3% year-on-year increase in group revenue during Q1, boosted by a record level of customer deposits during the period.

Revenue in the three months to 31 March hit €293.7 million (£249.4 million/$334.7 million). This comfortably surpasses the €248.2 million Betsson reported in Q1 last year but falls 4.3% short of Q4.

The company achieved particular success in Latin America and the company is eyeing further growth in the region driven by its exploits in the newly regulated Brazil market.

In LatAm, revenue jumped 70.3% to €74.5 million, a record-high for the region, on the back of deposits reaching an all-time high. Betsson highlighted growth across Argentina and Peru, with year-on-year increases for both casino and sportsbook revenue.

In his Q1 notes, Lindwall also referenced Betsson recently securing a full licence in Brazil. The group was awarded a full licence to offer online and sports betting in the country in March.

Betsson moved into Brazil in 2019 when it acquired a 75% stake in local sportsbook operator Suaposta. However, the full licence will expand its options in the country.

“Betsson’s ambition is to create long-term stable profit growth through geographical diversification and growth initiatives in existing and new markets,” Lindwall said. “Latin America, in particular, continues to be an important growth region where we are continuously strengthening our positions.”

Betsson optimistic despite uncertain global economic outlook

Data from Betsson shows growth across both the core casino and sportsbook businesses during Q1, with total customer deposits rising 15.2% to a record €1.59 billion. Active players increased 7%, but registered customers dipped 0.7% following the exit from certain markets.

This largely positive data, CEO and President Pontus Lindwall said, reflected the group’s overall position. He said despite “uncertainty” about the wider economy, gambling remains largely unaffected, with Betsson likely to see continuously higher demand for online gaming.

“The world around us is currently characterised by great uncertainty and concerns about reduced world trade, higher inflation and a weakening economy,” Lindwall said.

“We are closely monitoring macroeconomic developments, but at the same time we note that demand for gaming products has historically been relatively unaffected by the general economic cycle.

“Betsson operates in an attractive sector with structural growth driven by the continued online migration of gaming. The share of online gaming in the world will continue to increase for many years to come. We have a clear vision to deliver the best customer experience in the industry.”

Double-digit casino and sportsbook growth for Betsson

Looking at segment performance, casino was again the primary source of revenue for Betsson.

Casino revenue in Q1 topped €212.3 million, an increase of 17.6% and 72% of all revenue for the quarter. Some 470 new games were added to the Betsson portfolio during Q1.

As for sportsbook, revenue climbed 21.6% year-on-year to €79.7 million, or 27% of total Q1 revenue. Sportsbook margin for the quarter also increased from 6.6% to 8%.

The remaining €1.6 million in revenue came from other products including poker and bingo. This falls 27.3% short of last year.

Regional performance for Betsson

LatAm aside, Central and Eastern Europe generated €122.3 million of all revenue, up 11%. Betsson put this down to record-high deposits in Croatia and Greece, but reported declines across Lithuania, Estonia and Georgia.

Elsewhere on the continent, Western Europe revenue climbed 28.1% to €55.6 million, helped by record revenue in Italy. Revenue was also higher year-on-year in both France and Belgium.

Nordics revenue, however, was down 19.3% to €37.8 million, primarily due to lower casino activity. Betsson said this was the case in Sweden and Denmark, with sportsbook activity also lower in both countries.

An additional €3.4 million in revenue came from rest of world operations, down 14.8% year-on-year.

Net profit rises to €48.4 million

Turning towards the bottom line, gross profit after cost of services climbed 14.6% to €187.9 million. Operating costs were 16.9% higher but such was the impact of revenue growth that EBITDA was 8.5% higher at €77.7 million and operating profit up 9.5% to €57.9 million.

After finance costs, pre-tax profit was €61.8 million, up 13.4% year-on-year. Betsson paid €48.4 million in tax, leaving a net profit of €48.4 million, an increase of 13.1%.

“With a scalable, global business model and proprietary products and technology, we are well positioned for continued profitable growth going forward,” Lindwall said.