Betsson AB has maintained confidence in its sports betting operations, with revenue in the sector offsetting a decline in casino, whilst also lauding its acquisitions strategy but acknowledging hurdles in the newly regulated Dutch market.
Publishing its Q3 trading update, the Nasdaq Stockholm registered group reported overall revenue of SEK 1,733.3 million, representing a 3% increase on the corresponding quarter in 2020 (2020: 1,676.7m).
Meanwhile, the firm increased both its number of active customers by 7% to 986,429 (2020: 920,045). and net income from SEK 290.6 million Q3 2020 to SEK 287.4 million, although group EBIT experienced a decline to SEK 323.6 million (2020: 329.1m), a drop of 17% on the previous year.
Of the group’s divisions, sportsbook revenue increased by 24% to SEK 435.7 million (2020: 352.6m) of which 81% came via mobile verticals, offsetting a disappointing result for Betsson’s casino products – which saw a drop in earnings by 2% to SEK 1,275.7 million (2020: 1,306.5m).
Despite this, casino revenue still accounted for 74% (2020: 78%) of Betsson’s total group revenue, with sportsbook representing 25% (2020: 21%). Success in sports betting operations was further bolstered by revenues of SEK 21.9 million (2020: 17.6m) from poker, bingo and other products, a rise of 24%.
This has been largely attributed to the start of the 2021/22 domestic football season globally in August, as well as the success and popularity of international tournaments such as the UEFA 2020 European Championship and CONMEBOL Copa America.
Betsson AB, CEO, Pontus Lindwall, explained: “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.”
Further citing strong performances in Croatia, Greece and Latin America, Lindwall highlighted Betsson’s M&A driven sports betting and casino expansion in the latter, having strengthened its position in the region via a takeover of Inkabet, expanding its range of LatAm-focused brands including JDP Tech Ltd, Suaposta, and Colbet.
Additional investments in the Americas has seen the firm strengthen its foothold in the burgeoning US and Canadian markets, with the buyout of a 28% stake in Slapshot Media enhancing its status in Ontario whilst its plans for expansion in Colorado are also on track.
LIndwall detailed: “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.”
Refocusing on European operations, Lindwall expressed disappointment with the group’s progress in the Netherlands due to a decision by the national gaming authority, the Kansspelautoriteit (KSA), to implement a cooling off period which forced the company to cease operations while it awaits a licence.
As with many other operators, the group also encountered regulatory hurdles in the German market in the form of the newly amended Interstate Treaty on Gambling (GlüNeuRStv), impacting the firm’s casino products with 5.3% turnover tax.
Further European difficulties saw Betsson’s activity in the Nordic sectors hindered by the demand from Norway’s Lotteritilsynet (NGA) regulator for the firm’s BML Group Ltd subsidiary to cease offering gambling services and websites deemed to be targeting consumers in the market, although the company maintains objections to this order.
Despite regulatory hurdles across Europe, Betsson remains confident of its prospects in the fourth quarter of 2021 and going forward into 2022 – particularly in the aforementioned markets of Latin America and North America.
Concluding his statement, Lindwall remarked: “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.”