European headwinds offset by strong sportsbook growth for Betsson in Q1
A 45% surge in sports betting revenue coupled with “geographic diversification” contributes to overall growth of 8%
Betsson has pointed to strong momentum in its sportsbook and geographic diversification as key factors in an 8% year-on-year (YoY) increase in group revenue during Q1 2022 to €170.2m (£143.3m) compared with €157.4m in Q1 last year. Posting figures of €56.4m, the sportsbook vertical recorded an “all-time high” revenue increase of 45%. Sportsbook margin was 8.3%. Strong returns from domestic football leagues, the Champions League and Europa League were pinpointed as particularly beneficial. Despite this, group EBITDA was down 7% to €33.4m on last year’s Q1 announcement, equating to an EBITDA margin of 19.6%. Operating profit, or EBIT, fell 13% to €23.6m, while net income was €20.9m, or €0.16 per share. On a more positive note, active customers increased (YoY) by 33% to 1,256,449 from 948,109 in the comparative period in 2021. Casino revenue was down 5%, which was blamed on governmental regulations mainly in Western Europe, notably the Netherlands and Germany, however Russia’s invasion of Ukraine was also been highlighted. The firm stated: “The conflict has also brought that Betsson-contracted developers in Ukraine could in some cases be evacuated to Malta and Budapest, in other cases to less dangerous areas of Ukraine.” The company added: “Belarus’ active choice to get involved in the conflict on the Russian side led to Betsson’s decision to return the local license and completely shut down the operations that was building up in the country.” Operations in the Netherlands were shut down in 2021 following regulation, however Betsson insists that licence applications are well underway and the goal is to complete proceedings during Q2. “Applications to operate in the Netherlands under the new licence model were submitted during the quarter in line with the group’s plan.” This resulted in a decline of 43.5% in revenue across Western Europe to €22.2m from €39.83m for the same period last year. A widely hailed expansion into Latam, including launching in Buenos Airies, saw revenue in the region rocket by 174% to €36.8m. At the time of writing, Betsson’s share price was up 7.4% to SEK62.96 (£5.13).