Veikkaus GGR dips 3.6% amid regulatory upheaval

This marked another year of revenue decline, with the 2022 total dipping 3.0% compared to 2021.

Veikkaus’ performance in 2023 was backdropped by a number of seismic regulatory changes. In June, the then-newly formed Finnish government confirmed that it would end Finland’s current gambling monopoly system “no later than 2026”. This would be replaced by a new licensing system.

The new process would see Veikkaus split into several different companies, which would form part of the same group.

In September, Veikkaus warned that staff layoffs would be incoming as part of the monopoly’s end and, in November, it confirmed that “about 185-215” employees would lose their jobs. Veikkaus’ Casino Tampere was also shut in December, just under two years after it opened.

Data from mandatory ID

For its 2023 results Veikkaus also made allowances for the effect of the identification process it introduced in May. This mandated all Veikkaus players to register as customers for the purpose of ticket-based games.

The scratchcard version of this mandate came into force on 1 January 2024, meaning that all Veikkaus games now require identification to play.

“Today, all of our games, including all physical scratchcards, are subject to the identification requirement,” said Susanna Saikkonen, vice-president for sustainability at Veikkaus. “This means that we have become a worldwide pioneer in ensuring the responsibility of our gambling operations.”

Saikkonen noted that the data gathered from the ID process helped Veikkaus to further understand player habits including identifying players at risk of gambling harm.

“Using the data, we can analyse our players’ gambling habits and identify the signs of high-risk gambling,” Saikkonen continued. “In 2023, our gambling harm prediction system helped us make over 3,700 calls to at-risk players and we also introduced an automation-based care and communication model for high-risk level customers.”

Figures sliding down in FY23

For Veikkaus Oy – Veikkaus’ parent company – profit for 2023 was €585m, down 14.0% year-on-year. Operating profit for the company was €580.2m, marking a decline of 14.7%. Veikkaus Oy also paid €51.7m in lottery tax, 42.4% more than in 2022.

Veikkaus’ sales revenue fell 3.5% to €1.03bn for the year. This consisted of GGR as well as turnover from other business activities.

Materials and services totalled at €130.3m for the year. Expenses arising from employee benefits hit €98.2m, up 14.8%. Other business expenses totalled at €127.2m, up by 24.9% year-on-year. Meanwhile depreciation and impairment increased by 15.4% to €55.4m.

The €573.6m operating profit was improved slightly by €5.3m in financial income, but affected by €513,834 in finance costs. This left the total profit for the year at €578.4m, as there was no tax recorded for the year.

Declines in both group profit and operating profit were attributed to an increase in lottery tax, Veikkaus investments and one-time cost entries generated by cooperation negotiations. Profit was down by 13.7%, while operating profit fell 14.5%.

Veikkaus noted that in 2023, authenticated gambling made up 90.6% of Veikkaus’ domestic gambling operations. This was up 11.1% yearly. The monopoly had an estimated 2.5 million registered customers by the end of 2023, an increase of 180,000 or 8.0%.

Digital channel success bolsters Veikkaus’ presence

The monopoly highlighted a shift in customer channelisation in 2023, with 54.8% of Veikkaus’ customer gambling activities coming from its digital channel. This was 4.5% higher year-on-year. According to H2 Gambling Capital, Veikkaus made up an estimated 54% of the Finnish digital gambling market in 2023.

In terms of game performance, Veikkaus saw most success in its Eurojackpot and Lotto games. Eurojackpot generated GGR of €151.1m, which was flat compared to 2022, while Lotto GGR fell 8.9% to €136m.

Regina Sippel, chief financial officer at Veikkkaus, praised the company’s performance in its digital channels for 2023.

“Veikkaus’ profits and performance in 2023 were as expected and we can be satisfied with these as a whole,” said Sippel. “The year was particularly successful for our online games and Veikkaus will continue to deepen its development investments in its digital channel.”