OPAP hit by Greek austerity tax rise as profit drops

OPAP has cited the impact of higher austerity taxes in Greece as the main reason behind a year-on-year decline in profit during the three month to September 30.

Net profit in the third quarter amounted to €29.3 million ($31 million), down 40.3% on the €49.1 million posted in the corresponding period last year and a drop on the €33 million collected in Q2 of this year.

Earnings before interest, tax, depreciation and amortisation (EBITDA) also fell 28.4% from €87.1 million to €62.3 million.

The company’s results were hampered by the gambling new tax rate, which now stands at 35% of gross gaming revenue (GGR).

However, OPAP did report a 6.1% year-on-year climb in GGR, which amounted to €319.2 million in the third quarter, up from €300.9 million last year.

The results place net profit for the year-to-date, through to the end of September, at €115.1 million, 21.2% lower than at the same point last year, while EBITDA was also down 28.4% to €223.8 million.

GGR for the nine-month period remained level at €998 million.

Damian Cope, chief executive of OPAP, said: “Despite the ongoing challenging environment, OPAP delivered a solid set of results in the third quarter of 2016 with both turnover and GGR showing year-on-year growth.

“Although this growth was partially inflated by weak comparables due to the introduction of capital controls last year, we saw positive underlying improvements across our major products.

“Understandably our overall profitability was severely impacted by the increased GGR contribution rate to the Hellenic Republic; we continue to stress that, at 35%, this is materially higher than the average of other European markets.

“Looking forward, we do not expect any material improvement in the economic environment, but we will continue to execute the delivery of OPAP’s key strategic priorities as part of our ‘2020 Vision’.

“In the last few months we have already made tangible progress on each of them and are particularly pleased that we are now able to re-start the long-awaited VLT project.

“This, together with our other key initiatives, means that 2017 will be a busy year delivering considerable change and acting as the foundation for profitable, long-term growth for the benefit of all our stakeholders”

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