Revenue up, income down as European headwinds maintain impact on Betsson

Betsson

A series of drawbacks have continued to have negative effects on Betsson through the year’s first quarter, maintaining the impacts documented earlier this year in the gambling group’s Q4 and FY 2021 analysis. 

The company, which has firmly set its sights on recapturing ground across on the continent, as well as eyeing further opportunities in the Americas, saw revenue through the first three months of 2022 rise eight per cent to €170.2m (2021: €157.4m).

Casino recorded a 4.6 per cent downfall to €111m (2021: €116.4m) driven by well documented regulatory changes in Germany and a cessation of services in the Netherlands. Betsson has now confirmed that an application for a Dutch licence has been submitted.

Mobile casino revenue was €87.1m (2020: €85.8m) and accounted for 78 per cent (2021: 74 per cent) of the casino total, with the segment itself representing 65 per cent (2021: 74 per cent) of the €170.2m figure.

However, sports betting recorded a best revenue performance of €56.4m (2021: €38.9m), an increase of 45 per cent to occupy 33 per cent (2021: 25 per cent) of the aforementioned group total.

Mobile accounted for €45m (€31.7m) to represent 80 per cent (2021: 81 per cent) of total sportsbook revenue.

Revenue from other products, such as poker and bingo, closed the time frame up 29 per cent at €2.7m (2021: €2.1m), which is two per cent (2021: one per cent) of total revenue. 

Gross profit for the year increased five per cent to €107.1m (2021: €102.4m), however declines of 12 per cent and seven per cent were felt across net income and EBITDA which closed the quarter at €20.9m (2021: €23.7m) and €33.4m (2021: €35.8m), respectively. Active customers increased by 33 per cent to 1,256,449 (948,109).

“Once again, new records were set for sportsbook revenue and in several individual markets. It has been said many times before, geographic diversification makes Betsson’s business less sensitive to disruptions in individual markets,” reflected Pontus Lindwall, President and CEO of Betsson.

On a geographical basis, Western Europe, driven by the aforementioned German and Dutch impacts, saw revenue fall 43.5 per cent through Q1 2022 to €22.2m (2021: €39.3m).

The Nordics recorded an uptick of 12.5 per cent to €54.1m (2021: 48.1m), with the Swedish market said to be continuing to develop well in addition to Denmark reporting a high in revenue and deposits and Norway and Finland documenting year-on-year increases.

In Latin America, which has been a consistent focus of growth for Betsson and which Lindwall stated is “developing well,” revenue surged 174 per cent to reach €36.8m (2020: €13.4m).

Betsson, which sponsored World Cup qualifying games taking place in the region, said the all-time high performance in revenue and deposits was due to growth across “most of the countries in the region”.

Elsewhere,  Central & Eastern Europe and Central Asia dropped two per cent to €53.4m (2020: €53.5m), with Croatia and Greece showing “positive trends” and Estonia and Lithuania hitting highmarks despite a decrease in Georgia driven by igaming operations.

Revenue from the group’s rest of the world division was €3.7m (2021: €3.1), an increase of 19.3 per cent, mainly driven by Canadian operations.

“Looking ahead, we are seeing more undertakings on the horizon,” Lindwall added. “Our ambition is to further strengthen our presence in North America by operating under a new licence in the Ontario region in Canada starting this summer. We also aim to launch in Mexico together with our local partner Big Bola Casino in 2022. 

“Applications to operate in the Netherlands under the new licence model were submitted during the quarter in line with the group’s plan. 

“All in all, the year has been off to a good start as there are many important activities that we look forward to during the remainder of 2022.”

Average daily revenue in the second quarter 2022, up until and including April 25, is said to have been 13.5 per cent higher than the figure recorded through Q2 2021.