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Swush sale pushes up Danske Spil profits in Q1

| By Robert Fletcher
The sale of Danske Spil’s 60% stake in fantasy sports platform Swush contributed to an 11.1% year-on-year rise in net profit, while lottery growth offset weaker performances from its digital and gaming hall operations in Q1.
Danske Spil Q1

Group revenue at Danske Spil during the three months to 31 March hit DKK1.24bn (£140.5m/€166.2m/$178.3m), a 2.2% increase from DKK1.22bn in Q1 of last year.

The Danske Lotteri Spil lottery business contributed the majority of revenue, rising 4.9% year-on-year to DKK711m.

Danske Spil said that this was helped by high jackpots in the Eurojackpot game, aided by changes such as additional draws taking place and higher jackpots. 

Digital and retail struggle for Danske Spil

As for other business units, revenue from Danske Licens Spil, which includes sports betting and online casino, fell 1.0% to DKK393.

Danske Spil said growth in customers helped grow revenue for casino, although this was offset by sports betting declines.

Fierce competition and weak margins, coupled with retail market in decline since the 2021 introduction of mandatory player ID cards are holding back the vertical, it explained.

Danske Spil also noted DKK1m in revenue from Swush fantasy sports platform, down 50.0% year-on-year. This came after the group agreed to sell its 60% ownership stake in Swush to Danish tabloid newspaper Ekstra Bladet in early Q1. This sale generated an additional DKK27m in income during the quarter.

Elite Gaming, its gaming hall and land-based slots business, also reported a 1.3% decline in revenue to DKK75m.

Meanwhile, revenue from Danske Klasselotteri, which was merged into Danske Spil in April 2022, remained level at DKK64m. That business only holds twice-yearly draws, with 65% of ticket sales going into the prize fund.

Net profit up as Swush sale offsets higher costs

In terms of costs, agent commissions were relatively level at DKK156m and other gaming costs were down 8.2% to DKK101m. All other expenses were more or less level year-on-year, although external costs were up as a result of prices for goods and services rising, offset by lower depreciation and a marginal decline in personnel costs.

However, the DKK27m generated from the Swush sale offset both these increases. Coupled with the rise in revenue, this left a pre-tax profit of DKK646m, up 9.9% year-on-year.

Danske Spil paid DKK137m in tax, leaving a net profit of DKK510m, compared to DKK459m in Q1 last year.

The operator’s full-year projections for revenue between DKK5.0bn and DKK5.2bn for the 2024 financial year remain unchanged. Dankse Spil expects to post profit after tax between DKK1.8bn and DKK1.9bn for FY 2024.

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