UK growth sees NetEnt Q1 profits soar 60%
Further international expansion with 11 new licensing agreements helps gaming supplier's revenues rise 37% and transactions increase 31%
NetEnt chief executive Per Eriksson (pictured) this morning lauded a “very strong” set of Q1 2015 results after the company posted a 60% year-on-year increase in profit and a 37% rise in revenues.
Total operating profit for the three months ended 31 March amounted SEK81.8m (£6.2m), on the back of revenues totalling SEK258.3m (£19.7m) at a margin of 32%.
The hike in revenues and profits came following a quarter of continued expansion for the gaming supplier, with seven new customer casinos launched and the release of a range of games via Full Tilt.
Following improvements made to its mobile offering, mobile gaming was also a highlight, accounting for 21% of total game win, almost double the level recorded in in Q1 2014.
“We have made a very strong start to 2015, reaching new record levels for both revenues and profits,” Eriksson said. “Our innovative gaming solutions as well as our strong expansion on new and existing markets are among the reasons for the high growth and good profits,” he added.
In total NetEnt signed 11 new licensing agreements in the quarter with the likes of Danske Spil in Denmark, Gamesys in the UK and Codere in Spain as part of a regulated push with the UK highlighted as a key driver of growth in the period.
“During the quarter we continued to increase our market share with existing customers in the UK and our expansion in this market was a key contributing factor to the strong revenue growth for the Company in Q1,” a NetEnt statement said.
The firm is set to increase its international footprint later in the year and is currently in the process of obtaining a licence in New Jersey, although concerns remain over an Italy-facing business that could be squeezed after the regulator insisted suppliers could not provide games to unlicensed sites.
“In Italy the process continues to cease deliveries to operators that have not started the licence application process in the country and, as previously communicated, our revenues could be negatively impacted in the short term,” Eriksson said.
“We have strong momentum – our customer offering is world-leading and we are well prepared to seize new business opportunities on the growing digital casino market,” he added.
NetEnt’s share price was up almost 3% to SEK314 after early morning trading.