Evolution sees revenue and profit more than double in H1 after NetEnt deal

| By Robert Fletcher
Live dealer supplier Evolution has revealed that operating revenue and profit more than doubled in the first half of its 2021 financial year, primarily due to the impact of its acquisition of NetEnt late last year.

Revenue for the six months through to 30 June amounted to €492.5m (£425.9m/$579.2m), up 102.3% from €243.5m in the same period last year.

Evolution said that the completion of its acquisition of NetEnt in December last year played a major part in this growth, with its portfolio of games and services now significantly larger than in the first half of 2020.

Live casino games accounted for €387.4m of all revenue in H1, up 59.1% on last year, while the impact of the NetEnt acquisition could be seen with the revenue derived from random number generator (RNG) games. This amounted to €105.2m in H1 of 2021, whereas last year, Evolution did not receive any income from RNG activity.

Operating expenses for the period reached €195.0m, up 59.8% on last year, but the large rise in revenue meant earnings before interest, tax, depreciation and amortisation (EBITDA) was 130.4% higher at €334.8m.

Operating profit, meanwhile, jumped 126.6% to €297.5m, while after accounting for €3.7m in financial items, profit before tax was €293.8m, up 124.1% year-on-year.

Evolution paid €17.4m in tax, leaving an overall profit for the half of €276.4m, an increase of 121.8% from €124.6m in 2020.

“Our products are global, and our long-term ambition is to be the global market leader,” Evolution chief executive Martin Carlesund said. “We want to re-shape the online casino market in the world. It is that simple. 

“The expansion potential lies in both existing geographies and in new markets. It is a very active time within the company right now.”

Turning to the second quarter, Evolution saw revenue increase 100.1% to €256.7m, with live casino accounting for €203.7m in revenue and RNG games €53.0m.

Evolution also published details of its geographical performance during the three months to the end of June, with the rest of Europe – which covers all of Europe except the UK and Nordic countries – the supplier’s core market on €104.0m in revenue.

Asia accounted for €65.7m of all revenue, with North America on €27.2m, the UK €19.8m and the Nordics €16.4m. A further €23.5m in revenue was generated in other regions. 

Expenses were up 86.3% year-on-year to €100.8m, EBITDA increased 176.4% to €174.7m and operating profit jumped 110.1% to €155.9m.

Profit before tax was 106.6% higher at €153.1m, while after paying €8.7m in tax, Evolution was able turn an overall profit of €144.4m in the quarter, up 105.1% on last year.

“We are in the middle of reshaping our RNG road map and revenues in the RNG business increased slightly from the first quarter this year but declined by 2% compared to Q220,” Carlesund said. “I expect the year-on-year RNG-growth to improve in the coming quarters this year.

“The live casino business continues to see exceptional world-wide demand and grew with 59% compared to Q220. It is good to see live casino continue to deliver such a high growth rate yet another quarter. 

“I am happy with the performance in the second quarter but as always we can do better and should always strive to do more.”

Q2 also saw Evolution complete its acquisition of Big Time Gaming and secure a partnership with Scientific Games to bring our Lightning Roulette game to land- based casinos, marking the first time the game will go live in a physical facility.

“I very much look forward to the second half of the year, and to continue to widen the gap to competitors,” Carlesund said. “We remain ever as paranoid, only by working hard to improve our offering step-by-step, day by day – every day can we reach our goals.”

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