Euro 2016 marketing costs hit bet-at-home H1 profits
Operator reports double-digit revenue growth but a 75% increase in marketing spend sees EBITDA tumble 44%
Bet-at-home has reported a 44% year-on-year decline in H1 profits after double-digit revenue growth failed to offset a substantial rise in Euro 2016 marketing expenditure.
EBITDA for the six months ended 30 June stood at 9m (£7.6m), down from 16m (£13.6m) in H1 2015, with marketing expenses soaring 75% year-on-year to 26.6m (£22.5m).
The increase in marketing costs was part of a significant investment in the bet-at-home brand during the 2016 UEFA European Championship in France over the summer, which the operator claims will lead to greater future growth.
However, the Frankfurt-listed firm performed strongly on a revenue basis during the six-month period, with gross betting and gaming revenue increasing 15.2% year-on-year to 65.4m (£55.4m).
“Despite significantly higher marketing expenses due to the European Football Championship in France, a positive contribution to earnings was realised in Q2 between April and June 2016,” bet-at-home’s investor relations manager, Klaus Fahrnberger, told EGR.
“The further strengthening of brand recognition as well as the expansion of customer base will have a strong impact on the course of the business in the second half of 2016 and will lead to strong earnings development in Q3 and Q4.”
During the tournament, bet-at-home unveiled a number of new advertising campaigns, including TV commercials, posters, online ads and an “extensive” bonus campaign.
According to today’s results, bet-at-home had nearly 4.5 million registered customers, up from 4.1 million during the same six-month period last year.
The Betclic Everest-owned operator’s share price was up 3.4% to 64.50 on the Frankfurt Stock Exchange at the time of writing.