Q1 results 2021

Casino growth drives revenue and profit up at Betsson in Q1

| By Robert Fletcher
Betsson has reported a year-on-year increase in revenue and profit for the first quarter of its financial year, helped by growth within its core casino business.

Revenue for the three months to 31 March was SEK1.59bn (£138.0m/€157.6m/$191.2m), up 12.3% from SEK1.42bn in the corresponding period last year.

Casino revenue for the quarter amounted to SEK1.12bn, which was 16.1% higher than in Q1 of 2020. Some SEK868.2m was generated via its mobile casino.

Betsson felt the benefit of expanding its content portfolio with 180 new games, with the operator now offering over 5,100 titles from more than 100 suppliers. Betsson also completed the integration of Playtech’s live casino products, while the operator reported that it processed almost four billion game rounds during the period, up 24.0% on last year.

Revenue from Betsson’s sportsbook business edged up 2.4% year-on-year to SEK394.0m, with SEK320.9m coming from its mobile sports betting platform.

The operator said its sportsbook was helped by the number of major sports events in Q1, including the knock-out stage of football’s Uefa Champions League in Europe, as well as the National Basketball Association and National Hockey League regular seasons in the US.

In terms of other products, including poker and bingo, revenue here climbed by 15.1% to SEK21.3m.

Looking at geographical performance and Central and Eastern Europe and Central Asia (CEECA) was the main source of income for the operator, accounting for SEK541.1m in revenue during Q1, up 27.5% year-on-year.

Nordic revenue edged up 0.9% to SEK487.0m, while Western Europe revenue slipped 5.6% to SEK383.6m. Betsson saw most growth within its rest of world (RoW) operations, with revenue here jumping 74.8% to SEK181.1m, driven by activities on Chile and Peru.

Betsson also noted a significant increase in the number of active customers in Q1, with this rising 39.2% year-on-year to 948,109.

“On several markets, such as Italy, Baltics, Peru and Chile, we continue to deliver strong growth and good profitability,” Betsson president and chief executive Pontus Lindwall said. “This is very encouraging, however, we are not fully satisfied as we have experienced difficulties in a few other markets, for various reasons. 

“Revenues from the German market have decreased significantly, due to the restrictions introduced and the fact that we closed several brands in connection with this. In Norway it´s still difficult finding efficient payment solutions, but with its own proprietary payment platform, Betsson manages the situation. 

“Operations in the Netherlands continue as before, pending the start of the licensing process for foreign operators. We are pleased by the continued favourable development in the CEECA and ROW regions, thanks to successful brand launches and continuous improvements in the product offering.”

Looking at expenses, costs of services reached SEK556.9m, leaving a gross profit of SEK1.04bn up 9.8% on last year. Earnings before interest, tax, depreciation and amortisation (EBITDA) also increased 2.5% to SEK361.7m.

Operating expenses were up 11.2% to SEK759.8m, with costs higher in all areas, with the exception of amortisation and depreciation, which was down 7.3% to SEK85.6m. This left an operating profit of SEK276.1m, up 6.0% year-on-year.

After accounting for SEK12.8m in financial expenses, Betsson had SEK263.3m in profit before tax, an increase of 8.9% on last year. The operator paid SEK23.2m in tax, leaving a net profit of SEK240.1m, up 4.6% on Q1 of 2020.

“Thanks to a broad and diversified product portfolio with many brands in several markets, Betsson can deliver results to continue to create growth,” Lindwall said.

Lindwall also referenced Betsson’s growth plans in the US, saying work is ongoing to adapt its sportsbook for the market for a potential launch in Colorado, as well as the rollout of a a B2B offering of its sportsbook.

“The work of adapting and making the sportsbook attractive for the US market has been further intensified,” Lindwall said. “Betsson´s sportsbook will be integrated on TG Lab’s new US facing entity’s PAM before the launch in Colorado.”

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