Kindred Group has praised the possibilities of the newly re-regulated Swedish market, in addition to strong US foundations, as the organisation eyes a successful 2019 after getting off to a strong start.
Releasing its latest financial report, in which revenues hit an all-time high £250.1m (2017: £238) in Q4 and £907.6m (2017: £751.4m) for the full year, a series of significant events sealed at the turn of the year has seen gross winnings for the period January 1 to February 10, 2019, come in at 17 per cent higher than for the full first quarter last year.
The online gambling group has sealed a duo of strategic partnerships in the US, with last year’s agreement made alongside Hard Rock Hotel & Casino Atlantic City added to with the Mohegan Sun Pocono in Pennsylvania, giving Kindred the ability to offer online gaming and online and offline sports betting in the Keystone State.
Striving to gain further new market entry with a licence application submitted in Spain in December, Kindred Group successfully went live under the new local license in Sweden with its Unibet, Maria Casino, iGame, Storspelare and bingo.com brands.
Henrik Tjärnström, CEO of Kindred Group, spoke about both the US and Sweden, the latter of which saw plans go back to last summer’s Russian World Cup: “On 1 January, we successfully went live under the new local license in Sweden with five of our brands, and we have also continued to lay the foundation for the USA early this year with the agreement in Pennsylvania.
“In the fourth quarter of 2018 we have seen strong levels of activity, together with an all-time high in active customers”
“Always planning ahead, the group prepared for the opening of the Swedish market and enlarged the customer base through bonus offers, and marketing investments already from the start of the World Cup last summer.
“During the first six weeks of 2019, we awarded our Swedish customers with one additional bonus under the terms of the new licensing system, which resulted in new depositing customers up by 166 per cent, and active customers up by 97 per cent over the last 90 days. As expected, we can now see the bonus expenditure tail off.”
Highlighting a tough quarterly comparison, due to “exceptional sportsbook margin in the fourth quarter of 2017,” EBITDA of £58.8m (£74.5m) pushed full year figures to £203.7m (2017: £185m).
With the number of active users for the quarter rising to 1,568,574 from 1,329,124, profits after tax came in at £39.3m (£50.8m) and £131.6m (2017: £117.4m) for Q4 and FY respectively.
Tjärnström explained: “In the fourth quarter of 2018 we have seen strong levels of activity, together with an all-time high in active customers. This has resulted in record gross winnings revenue, proving that our long-term strategy, to maintain a sustainable business by increasing the number of active customers rather than the ARPU, is paying off.
“Despite the exceptional sportsbook margin in the fourth quarter of 2017 making the comparatives for this quarter very tough, we have still managed to grow the business by 5 per cent.
“During the fourth quarter, gross winnings revenue from mobile grew by 11 per cent compared to the fourth quarter last year, and amounted to 74 per cent of our total gross winnings revenue. Of the group’s gross winnings revenue, 45 per cent came from locally regulated markets.
“For the full year 2018, betting duties increased by 40 per cent with an EBITDA margin of 22 per cent, which shows the group’s ability to absorb betting duties through its focus on scalability and cost control.”