Svenska Spel posts Q1 revenue decline following Casino Cosmopol closures

Svenska Spel
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Svenska Spel has reported a decline in net revenue and profit in the first quarter of 2024 following the closure of its Casino Cosmopol properties in Malmö and Gothenburg.

Although the February closures impacted results, the Swedish operator has stated that its underlying business remains stable with strong results from Tur, as the company restructures with the aim of creating “long-term sustainable value”.

Publishing its Q1 results, Svenska Spel declared a net gaming revenue of SEK 1.96bn (€168m), down one per cent year-over-year (Q1 2023: SEK 1.98bn), which the operator attributes to the restructuring of its casinos.

Sport & Casino revenue amounted to SEK 549m, down three per cent YoY (2023: SEK 565m) after impacts were seen on sports betting margin and pool game outcomes.

Tur revenue improved by six per cent in comparison to the same period the previous year to SEK 1.24bn (SEK 1.16bn), assisted by Eurojackpot and continued growth for Triss. 

Casino Cosmopol & Vegas revenue fell by 32 per cent YoY to SEK 169m (2023: SEK 247m) after the closure of two of its casinos in Malmö and Gothenburg, as well as the reduction in opening hours for its Stockholm casino.

Online revenue improved by six per cent YoY to SEK 1.09bn (SEK 1.03bn), amounting to 56 per cent of the total net gaming revenue.

During the quarter, Svenska Spel reorganised its operations to allow for future investments, which resulted in a reduction of its workforce.

Commenting on the past quarter, Svenska Spel CEO and President, Erik Strand, said: “We have reorganised, reduced the workforce, and from April 1 have a new organisation in place. 

“In this way, we have freed up resources that we can invest in transformation, a strengthened gambling responsibility work and growth. These are important investments for long-term sustainable value creation.”

Near the end of the quarter, Svenska Spel Sport & Casino was handed a warning and a SEK 100m penalty fee from the Swedish gaming authority Spelinspektionen for duty of care failures in 2021, a decision which the operator has appealed.

Svenska Spel’s operating profit came in at SEK 310m, down 49 per cent YoY (2023: SEK 612m), with an operating margin of 16 per cent (2023: 31 per cent).

Both figures were negatively impacted by SEK 375m in non-recurring costs, which included the closing of the Malmö and Gothenburg casinos, restructuring costs, as well as a provision for the Spelinspektionen penalty fee.

Excluding non-recurring costs, operating profit was SEK 683m (2023: SEK 612m) with an operating margin of 35 per cent (2023: 31 per cent).