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2021-10-26

Betsson AB (publ) interim report July - September 2021

Yet another strong quarter driven by the sportsbook

QUARTER JULY - SEPTEMBER 2021

  • Group revenue was SEK 1,733.3 (1,676.7) million, an increase of 3%. Organic increase of 8%.
  • Casino revenue decreased by 2%. Sportsbook revenue increased by 24% and the sportsbook margin was 7.9% (7.0%).
  • Operating income (EBIT) was SEK 323.6 (329.1) million, a decrease of 1.7%, the EBIT margin was 18.7% (19.6%).
  • Net income was SEK 287.4 (290.6) million, corresponding to SEK 2.22 (2.22) per share.
  • Operating cash flow was SEK 423.5 (494.6) million.
  • Active customers increased by 7% to 986,429 (920,045).
  • Acquisition of Inkabet and investment (28%) in Slapshot Media Inc.

CEO COMMENT

"Yet another strong quarter driven by the sportsbook"

After several records during the previous quarter, we managed to increase revenue by just over 3 per cent during the third quarter, compared with the corresponding quarter last year, which was a very strong quarter. At that time, the strong increase in revenue was driven by a surge in demand for digital entertainment. The further increase in revenue is explained by the successes with our sportsbook in combination with good results in the ending rounds of the EURO 2020 and CONMEBOL Copa América and the return of the domestic football leagues from mid-August. All in all, this has resulted in sportsbook revenue increasing by approximately 24 per cent year-on-year. The increase in revenue has also benefited from successes in new markets such as LatAm, Croatia and Greece.

Against the background of strong development this year, it was unfortunate that the Dutch Gaming Authority unexpectedly published a new policy at the end of September that entails a deviation from the previously communicated guidelines during the cooling off peri-od. The new policy implies that operators who are waiting out the cooling off period is forced to cease operations completely, pending an obtained license. Based on the new policy, Betsson decided to temporarily stop accepting Dutch customers on international websites in order to create good conditions for the upcoming licensing process. Betsson continues to have strong faith in the Dutch market and an ambition to be able to conduct business in the future in accordance with the new regulations. The efforts to prepare the license applications and preparations for certifying our technical platform in the Dutch market are ongoing. The application is expected to be submitted no later than at the end of the first quarter 2022 in connection with the end of the cooling-off period. The outcome of the application process is expected to be communicated after the summer of 2022 and I then hope our position in the Netherlands gradually can be regained thanks to strong brands and an organization with good local knowledge.

Continued investments in the US

The investments in the US market to be able to launch our B2C offerings in Colorado during the first quarter of 2022 continue according to plan. This quarter has been an intense period to secure everything from meeting the authorities' reporting requirements to adapting the platform and technology so that the US-adapted sportsbook can enter a testing and certification process. The sportsbook has also been integrated into the Strive platform, which has now been certified in the state of Colorado. The fact that the Strive platform is certified will benefit us during the testing and certification processes that are initiated now.

Strengthening Betsson through acquisitions

During the quarter, we acquired Inkabet's B2C business. Inkabet is a fast-growing sportsbook and casino business aimed at the western region of South America. The acquisition further strengthens and expands our presence and position in the Latin America region and builds on the previous acquisitions of JDP Tech Ltd, Suaposta, and Colbet. We have also invested in the Canadian startup company Slapshot Media Inc by acquiring 28 per cent of the shares. The investment in Slapshot Media Inc means a partnership with local Canadian expertise that enables Betsson to create a strong position in the Canadian market ahead of the upcoming regulation in Ontario. Strengthening our business through acquisitions is an important component of our strategy and it has been a successful way to create growth but also to build competence in the organization. In this way, a dynamic business is created that also positively impacts existing operations.

A strong team paves the way for future success

An important guiding star for my leadership has always been to drive the company towards the goals set for it, regardless of obstacles along the way and I intend to continue according to that. We have built a very strong and competent team at Betsson and I look forward to continuing to build the company even stronger in the future.

PRESENTATION OF THE INTERIM REPORT

At 10:00 CEST today 26 October, Betsson invites analysts, investors and media to participate in the results presentation of the third quarter. The results will be presented by CEO Pontus Lindwall and CFO Martin Öhman. The presentation will be held in English, followed by a Q&A session. Participants are welcome to join via the link or phone, see details below.

Dial-in numbers: 
Sweden: +46 8 50 55 83 66
UK: +44 33 33 00 92 69
US: +1 631 913 1422 PIN US: 79535039#

Webcast link: https://tv.streamfabriken.com/betsson-financial-hearing-q3-2021

This information is information that Betsson AB is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication at 07:30 CEST on 26 October 2021.

For further information, please contact:

Pontus Lindwall, President and CEO Betsson AB
pontus.lindwall@betssonab.com
Martin Öhman, CFO Betsson AB
martin.ohman@betssonab.com

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