Betsson ‘not fully satisfied’ despite delivering ‘strong growth’ during Q1

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Betsson Group has pinpointed a trifecta of key growth areas that, based on its strength and through market analysis, it’s hoped will enable the operator to make significant strides on a long-term ambition of outgrowing the total market.

Striving to do so in a profitable and sustainable manner, Betsson is aiming to ensure growth in existing markets; expansion into new markets; and development of its B2B offering with a focus on the in-house developed sportsbook.

The comments come as the group publishes its quarterly update for the January to March period, which Pontus Lindwall, president and CEO Betsson, says that, despite being encouraging, the group is “not fully satisfied” due to market difficulties encountered.

During the period the group scored a 12 per cent revenue increase to SEK 1.59bn (2020: SEK 1.41bn), with gross profit ten percentage points ahead at SEK 1.03bn (2020: SEK 943.9m), net income up five per cent to SEK 240.1m (2020: SEK 229.6m), and EBITDA slightly up at SEK 361.7m, a two per cent rise from 2020’s SEK 352.9m. Active customers increased by 39 per cent to 948,109 (2020: 680,938). 

Revenue gained during Q1 from the casino segment, which released 180 games and 14 of which came via a period of exclusivity, finished up at SEK 1.17bn (2020: SEK 1.01bn), an increase of 16 per cent. Casino represented 74 per cent (2020: 72 per cent) of group revenue.

Mobile casino revenue was SEK 868.2m (2020: SEK 674.8,), and accounted for 74 per cent (2020: 67 per cent) of total casino revenue.

Sportsbook revenue during the quarter was SEK 394m (2020: SEK 384.9m), an increase of two per cent, and represented 25 per cent (2020: 27 per cent) of group revenue. Mobile sportsbook revenue was SEK 320.9m (2020: 312.3m), and represented 81 per cent (2020: 81 per cent) of total sportsbook revenue.

Revenue from other products, including poker and bingo, was SEK 21.3m (2020: SEK 18.5m), an increase of 15 per cent. This represents one per cent (2020: one per cent) of total revenues.

During 2020, the migration of multiple brands to Playtech’s iPoker network was undertaken, which Betsson says received positive feedback during the first quarter and saw active players increase by 38 per cent year-on-year.

On a regional basis, revenue from Central and Eastern Europe and Central Asia came out on top with a 27 per cent increase to SEK 541.1m (2020: SEK 424.7m), ahead of a one per cent nudge in the Nordics to SEK 487m (2020: SEK 482.7m).

Western European revenue fell six per cent to SEK 383.6m (2020: SEK 406.5m), with decreases felt in the UK and Germany, the latter of which the group aligns to restrictions on online casinos introduced in December and its decision to close down several brands in the market in connection with these.

Revenue in the company’s rest of the world segment surged 75 per cent to finish at SEK 181.1m (2020: SEK 103.6m), driven by growth in Peru and Chile.

Dissecting Betsson’s global performance in a little more depth, Lindwall explained: “2021 began with a quarter that showed growth compared to the same period last year. On several markets, such as Italy, Baltics, Peru and Chile, we continue to deliver strong growth and good profitability. 

“This is very encouraging, however, we are not fully satisfied as we have experienced difficulties in a few other markets, for various reasons. As previously communicated, revenues from the German market have decreased significantly, due to the restrictions introduced and the fact that we closed several brands in connection with this. 

“In Norway it’s still difficult finding efficient payment solutions, but with its own proprietary payment platform, Betsson manages the situation. Operations in the Netherlands continue as before, pending the start of the licensing process for foreign operators. 

“We are pleased by the continued favourable development in the CEECA and ROW regions, thanks to successful brand launches and continuous improvements in the product offering.”

Betsson also reports that average daily revenue in the second quarter of 2021, until April 25, was 12 per cent higher YoY, with the firm also currently adapting its sportsbook for the US market, initially with the intention to offer it as an operator in the state of Colorado.