Kambi optimistic on ‘promising’ future as Q3 endures expected declines

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A difficult third quarter has delivered an expected series of declines for Kambi, with a quiet sporting calendar, absent of a major men’s football tournament, said to be primarily responsible.

Alongside this, a period that the group further noted as being one where “seasonality impact is felt greatest,” a “particularly light” US output is dominated by the MLB as NBA and NFL rests off season.

“The third quarter is always the most challenging for the sports betting industry given the quiet sporting calendar and this year was no exception,” noted Kristian Nylén, CEO of Kambi.

“It was also a quarter marked by growing global economic uncertainty and higher cost of living, trends which show little sign of subsiding any time soon. 

“Despite this, Kambi proved its resilience once more and I am pleased to report another busy quarter for the business with operator turnover growth of 12 per cent.”

However, he does point to “great commercial momentum” via the signings of ilani, Mohegan, Oaklawn and Ondiss, with PENN Entertainment and Great Canadian Entertainment subsequently following suit post the close of Q3.

During the July to September time frame revenue dropped 12 per cent to €36.7m (2021: €36.7m), with operating profit and EBITDA enduring a similar fate with drops of 74 per cent and 47 per cent to €3.9m (2021: €14.7m) and €10.7m (2021: €20.4m).

Furthermore, with GGR up 17 per cent, Americas led the way via a constitution of 53 per cent (2021: 43 per cent), followed by Europe 43 per cent  (53 per cent ) and the Rest of the World four per cent (two per cent).

A similar picture is painted through the year-to-date, with revenue, operating profit and EBITDA each down by 15 per cent, 68 per cent and 45 per cent to €108.2m (2021: €127.5m), €16.1m (2021: €50m) and €36.1m (2021@ €65.8m), respectively.

Operating expenses for the third quarter of 2022 were €32.8m (2021: €26.9m), which included €800,000 from the Shape Games post acquisition, and €92.1m (2021: €77.6m) for the first three quarters.

“Our future is looking promising, operating from a strong position as we enter an economic recession which, while it will no doubt present challenges, may prove positive for B2B businesses such as Kambi in the long term,” added Nylén.

“When also taking into consideration the recent start of the US basketball season and a World Cup still to come, we look forward to ending 2022 on a high before embarking on an exciting 2023.”