Betsson AB reacts to Q3 results
Online gambling firm Betsson has stated it is ‘not satisfied’ with its recently released Q3 results. The firm has seen a double-digit increase in revenue, but also saw a double-digit decline in earnings on the year.
The Betsson group’s revenue rose by 11% up to $114.3m by the end of September compared to a year ago. Organic growth was very low at just 2% however, with growth coming largely due to acquisitions made earlier in the year, such as RaceBets. These acquisitions helped Betsson to a 69% growth in Western Europe in Q2 of this year, with organic growth at 15%.
Operating income fell by 21% while net income fell even more by 26%. The firm have attributed this to currency impacts and high betting duties and costs taken on with the recent acquisitions.
The Betsson sportsbook also suffered particularly badly, with revenue falling by 8%. Margins slipped on the sportsbook too, while turnover fell by 3%. Casino operations fared better, with the casino vertical up 19% from last year’s revenue. The casino operation at Betsson now has a 74% share of overall revenue.
The story in Betsson’s Western Europe markets is a positive one, with a 63% growth in revenue. In the firm’s core Nordic market, revenue remained flat, but losses were felt elsewhere, specifically in Central & Esatern Europe and the Central Asian markets, where revenue declined by 14%.
Not all the acquisitions had a positive impact. Pontus Lindwall, Betsson CEO, commented on the performance of the recently acquired NetPlay brand:
Despite a good finish to the quarter, we are not satisfied with the overall growth in the quarter and Betsson has taken action to improve performance. Moreover, NetPlay, which Betsson acquired in April 2017, has not developed as well as planned and measures have been taken to get the business back on track.– Pontus Lindwall, Betsson CEO
Q4 off to a positive start
Pontus Lindwall was quick to point out that the firm is still planning to market by region the acquisitions. Daily revenue in October of this year is already up 10% from October 2016 and should improve once the group can better organise its new-found multi-brand approach. The group also announced recently that it will launch a Spanish facing sportsbook, after signing a two-year deal with BetConstruct to supply the platform.
However, not everything is going so smoothly. The European Commission has decided against the company’s demand to reopen proceedings for an infringement made against the Netherlands in 2016. Betsson had also tried to block the Dutch regulatory body’s enforcement of penalties towards unauthorised gambling operators, but the request was denied. Betsson has stated it will not appeal.