Betsson is to continue monitoring macro and geopolitical factors that could bring yet more uncertainty and influence business trends, particularly if a potential recession comes to reality, as the online gambling group reflects on its second quarter and full-year performance.
The sees the company record an eight per cent Q2 revenue uptick to €186.3m (2021: €172.8m), primarily driven by significant increases across the Latin America and Central and Eastern Europe and Central Asia regions.
Gross profit for the year increased three per cent to €111.8m (2021: €115.7m), however declines of 14 per cent and 16 per cent were felt across net income and EBITDA which closed the quarter at €28.5m (2021: €33.3m) and €39.3m (2021: €14.6m), respectively. Active customers increased by 21.3 per cent to 1.24m (2021: 1.02m).
For the year these trends are maintained, with revenue up eight per cent during January and June to €356.4m (2021: €330.2m), as gross profit reached €225.8m, up four per cent from 2021’s €218.1m.
However, net income and EBITDA slid 13 per cent and 12 per cent to close the six month time frame at €49.4m (2021: €57.1m) and €72.7m (2021: €82.3m).
This maintains the performance reported by the group following the close of the year’s first three month period, where both revenue and gross profit increased but net income and EBITDA fell.
“Betsson’s second quarter featured continued good growth with all-time high revenue and further investments to support our expansion,” noted Pontus Lindwall, President and CEO Betsson.
“The group’s organic growth was 13 percent, mainly driven by Latin America and the CEECA region, where we see long-term growth potential as these markets still have a low share of online gaming.”
Casino revenue recovered from a Q1 downfall to increase 1.3 per cent to €122.2m (2021: €120.6m) in the ensuing quarter, despite well documented regulatory changes in Germany and a cessation of services in the Netherlands.
Mobile casino revenue was €96.8m (2020: €85.8m) and accounted for 79 per cent (2021: 74 per cent) of the casino total, with the entire segment itself representing 66 per cent (2021: 70 per cent) of the €186.3m figure.
Sports betting recorded a second straight best quarterly revenue performance of €61.6m (2021: €50.3m), an increase of 22.4 per cent to occupy 33 per cent (2021: 29 per cent) of the aforementioned group total.
Mobile accounted for €48.2m (€41.4m) to represent 78 per cent (2021: 82 per cent) of total sportsbook revenue.
Revenue from other products, such as poker and bingo, closed the time frame up 28.9 per cent point to €2.5m (2021: €1.9m), which remains consistent year-on-year with one percent of total revenue.
On a geographical basis, CEECA captured the largest percentage of group revenue at 33, courtesy of a 23.4 per cent rise to close the period at €61.1m (2021: €49.5m).
This, which represents a best performance for the region, is driven by casino operations as well as continued positive trends across Croatia and Greece,
Next in line is the Nordics despite a 5.7 per cent downfall to €51.2m (2021: €54.3m), where an all-time high Danish performance, due to igaming, was not enough to offset declines across Sweden and Norway. The region represents 27 per cent of title revenue.
Yet another revenue record was felt in LatAm where levels of activity remained high, thanks to events such as World Cup qualifying, to account for 25 per cent of the group-wide total thanks to a Q2 increase of 86.2 per cent to €51.2m (2021: €54.3m).
In Western Europe, driven by the aforementioned German and Dutch impacts but helped along by a continually performing Italian market, revenue fell 39.1 per cent through Q2 2022 to €24.8m (2021: €39.1m), representing 13 per cent of the total.
Revenue from the group’s rest of the world division was €3.5m (2021: €3.7m), a decrease of 4.7 per cent, to represent the remaining two per cent.
“In conclusion, we see that macro and geopolitical factors continue to dominate the world around us, with great uncertainty and concerns around war, inflation, higher interest rates and potentially a coming recession,” Lindwall commented
“Despite uncertain capital markets, we recently refinanced our bond until 2025, which gives us financial flexibility to continue investing in both organic growth and selective acquisitions.
“We continuously monitor the macroeconomic trends but also note that historically Betsson’s business has been relatively unaffected by the general business cycle.
“The first weeks of July are off to a good start and despite the macro factors, we are rather optimistic as we look ahead to the rest of 2022, which has many planned activities for Betsson, including market launches in Mexico and Ontario, as well as the football World Cup during the seasonally strongest fourth quarter.”