Evolution Gaming: Interim Report January-June 2015

Second quarter of 2015 (Q2 2014)

• Revenues increased by 55% to EUR 17.9 million (11.5)
• Profit for the period amounted to EUR 5.9 million (2.9)
• Earnings per share amounted to EUR 0.16 (0.08)
• Adjusted EBITDA increased by 89% to EUR 7.7 million (4.1), corresponding to a margin of 43% (35)

Events during the second quarter of 2015

• Mobile growth in excess of 250% year-on-year
• On-premise studio in Belgium with the majority of the country’s online casinos as customers
• Secured rights to games and side bets from Games Marketing
• Evolution wins EGR Live Casino Supplier of the Year for the sixth year in a row

Events following the balance sheet date

• Agreement with Genting Alderney
• Live casino launched for Adjarabet and Marathonbet

CEO Jens von Bahr's comments:

Evolution’s strong performance continues and we again noted record revenues and earnings for the most recent quarter. EBITDA amounted to EUR 7.7 million, corresponding to a margin of 43%. We are seeing very strong growth in the market driven by increasing engagement by operators and more end users who discover live casino, particularly using mobile devices. In the second quarter, 24% of the operators’ gaming revenues via the Evolution platform were generated by mobile devices compared to 11% last year. In absolute numbers the increase was more than 250%, still without cannibalising other platforms.

One of the most important events in the quarter was the agreement with Casino de Spa in Belgium, where we have built a local studio in accordance with the country’s new gaming regulations. We currently have six customers who via land-based casinos hold online casino licences from the Belgian Gaming Commission, giving us a virtual monopoly position in the market. In addition, we have a large number of customers who hold licences to operate online gaming arcades. As at our other on-premise studios, gaming is conducted locally, while software, support and surveillance are handled through Riga. The Belgian presence is well in line with our growth strategy of being the first Live Casino provider in regulated markets. By means of the studio, we have established significant entry barriers for competitors and, in terms of revenue, Belgium is expected to become our largest regulated market after the UK.

Beyond our focus on regulated markets, qualitative gaming content is also key to our continued growth. During the quarter, we secured the rights to additional table games and side bets from Games Marketing’s proprietary product portfolio. The games are provided with certain preferential rights and further strengthen our leading product offering. Several of our customers have already decided to launch the new games to their end users, and we expect to go live with the first one in November.

Finally, I would also like to highlight the fact that Evolution was named Live Casino Supplier of the Year for the sixth time at the EGR B2B Awards in London in June. We have won this accolade every year since the awards began in 2010 – very strong recognition of the quality of our offering.

By the time this report is published, we will have progressed halfway through the third quarter. To date, we have among others signed an agreement with Genting Alderney, the online division of world leading casino operator Genting Group, providing excellent potential to capitalise on the trend whereby land-based casinos with strong brands are strengthening their online presence. In the UK alone Genting operates more than 40 land-based casinos, and I see good opportunities to develop our partnership over time. We are also continuing our drive in product innovation and, during the quarter, recruited Todd Haushalter as our new Chief Product Officer – a prestigious recruitment in the global casino industry. He will be a member of the management team for our operational entity in Malta, which, in recent months, has also been reinforced with several other influential individuals, including CEO Martin Carlesund.

For the third quarter we can also note that the historical seasonality with lower activity during the summer months is no longer to be seen. Evolution has a strong tailwind and the conditions to continue strengthening our leading position in Live Casino are exceptionally good. Going forward, we will continue to focus fully on further distancing ourselves from our competitors in terms of critical factors such as product range, operational excellence and regulated markets.

For further information, please contact:
Adrian Westman, IR Manager
+46 735 090 400, awestman@evolutiongaming.com

The information in this report is such that Evolution Gaming Group AB (publ) is required to publish pursuant to the Securities Market Act and/or the Financial Instruments Trading Act. The information was submitted for publication on 27 August 2015 at 8:00 a.m. (CET).

Evolution Gaming Group AB (publ) (”Evolution”) develops, produces, markets and licenses fully-integrated B2B Live Casino solutions to gaming operators. Since its inception in 2006, Evolution has developed into a leading B2B provider in the European market with 70 operators among its customers. The group currently has about 1,500 employees, most of whom are located in Latvia and Malta. The parent company is based in Sweden and listed on the Nasdaq First North Premier exchange under the ticker EVO. Avanza Bank is the company’s certified adviser. Visit www.evolutiongaming.com for more information. 

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