Casino closures and RG focus lead to decline at Svenska Spel in 2024

Revenue for the 12 months to 31 December 2024 hit SEK7.74 billion (£570.9 million/€683.9 million/$709.9 million). This falls 3.7% short of the SEK8.03 billion posted by Svenska Spel in the previous year.

The figures, published today (7 February) by Svenska Spel, show declines in three out of four core business areas. Most apparent was a 65.1% drop in revenue from the Casino Cosmopol segment after two sites were closed in January 2024.

However, other factors impacted wider performance for 2024. These include strengthened responsibility measures such as income checks on high-staking players and more welfare calls.

There was also Sweden’s decision to increase gambling tax from 18% to 22% of gross gaming revenue in July. 

Uncertain future for Casino Cosmopol

When analysing the performance of each segment of the group, and starting with Casino Cosmopol, unsurprisingly this area saw the largest decline. Revenue dropped 65.1% to SEK165 million.

Only one Casino Cosmopol location remains after facilities in Gothenburg and Malmö were shuttered during 2024. However, the future of the Stockholm site remains uncertain after Sweden’s government in May proposed discontinuing the monopoly’s land-based business altogether.  

Elsewhere at Svenska Spel, the group’s primary source of revenue by some distance remains its Tur lottery division. This was also the only area to report growth in 2024 with revenue up 4.3% to SEK5.14 billion, helped by growing interest in the Eurojackpot product.

However, the online Sport & Casino business records a drop in revenue of 4.3% year-on-year to SEK2.07 billion. Svenska Spel said this was mainly due to its heightened responsible gambling measures.

Finally, the Vegas gaming machine segment saw revenue fall by 22.4% SEK364 million. The group again referenced its new approach to responsible gambling, as well as the economic situation in Sweden.

Net profit slips 8.9%

Turning to costs, Svenska Spel was able to save on personnel expenses after closing the two casinos. However, external costs were higher year-on-year, partly due to the one-off costs referenced by CEO Johnson.

This, coupled with the decline in revenue, meant operating profit slipped 9.3% to SEK2.12 billion.

After including SEK149 million worth of positive financial items, pre-tax profit for the year hit SEK2.26 billion, down 7.7%.

Svenska Spel paid SEK493 million in tax, meaning a net profit of SEK1.77 billion (down 8.9%).

Caring about Svenska Spel customers

Reflecting on the data, CEO Anna Johnson said despite the declines it was not all bad news for Svenska Spel.

She said when excluding one-off costs related to reorganising the group and closing casino venues, operating profit and operating margin were higher year-on-year and meant the operator had exceeded its financial targets

“This shows that we are well equipped for the investments we need to make going forward,” Johnson said.

Johnson also referenced the responsible gambling focus. She said that while this impacts the group’s financial performance, it is in its interest to further protect players from harm.

“We continue to strengthen responsible gaming,” Johnson said. “We do this because caring for our customers is one of our highest priorities. This negatively affects our revenues and profitability, but it is a conscious choice as we want all our customers to play healthily with us.

“It also has the intended positive effect on healthy revenue, that is, revenue from customers with a low risk of developing gambling problems.”

Ending 2024 on a strong note

While Svenska Spel saw decline for the full year, in the three months to 31 December revenue topped SEK2.23 billion, marginally higher than SEK2.12 billion in Q4 of the previous year.

Reduced spending meant operating profit was able to climb 10.3% to SEK535 million while pre-tax profit was also 25.1% up at SEK608 million.

Svenska Spel paid SEK126 in tax resulting in a net profit of SEK482 million for the quarter, a rise of 25.9%.

“2024 has been a year of major changes for Svenska Spel and a weak economy in Sweden,” Johnson said.

“It is a message of strength that the year ended with a quarter with revenues in line with the previous year and improved operating profit linked to lower operating costs.”

Could the government offload Svenska Spel?

Towards the end of 2024, more doubt was cast over the government’s future ownership of Svenska Spel.

Gustaf Hoffstedt, the secretary general of the Sweden Trade Association for Online Gambling (BOS), urged Sweden’s government to sell off Svenska Spel. This, he said, would help remove concerns over regulatory authority and competition within the market.

Writing in an op-ed on Swedish news site Dagens Industri, Hoffstedt reflects on the Swedish government’s decision to sell vehicle inspection company Bilprovningen to TÜV Rheinland, comparing the state-owned business to monopoly operator Svenska Spel.

The two most-represented parties in parliament, the Moderates and Sweden Democrats, have both previously declared support for privatising Svenska Spel.