Betsson AB Interim report January - March 2020

 QUARTER JANuarY – marCH 2020

• Group revenue was SEK 1,417.5 (1,330.6) million, an increase
  of 7%, reported and organic.
• Casino revenue was in line with the same quarter last year. Sportsbook revenue increased by 29% and the sportsbook margin was 8.5 (6.3)%.
• Operating income (EBIT) was SEK 260.6 (255.2) million.
  The EBIT margin was 18.4 (19.2)%.
• Operating cash flow was SEK 321.9 (214.5) million, an increase of 50% compared to the same quarter last year.

SIGNIFICANT EVENTS AND OUTLOOK

• Launch of Jalla Casino, an in-house developed fast and easy to play mobile casino.
• Betsson acquired Gaming Innovation Group’s B2C vertical and strengthens its position in some of its key markets. This is expected to be earnings accretive from 16 april 2020.
• Betsson reached a milestone by signing its first pure B2B sportsbook customer for the provision of its odds and technical platform.
• Share buy-back of SEK60 million (average price SEK 34.05 per share) to improve the capital structure of the Company by reducing the number of shares.
• The daily average revenue in the second quarter 2020 until 16 April was 0% (2% organic) higher than the average daily revenue of the full second quarter 2019.

CEO COMMENT

"We had a strong first quarter in all areas and I look forward to the future with confidence. We reached a milestone in signing our first pure sportsbook customer, we have made a value accretive acquisition and we have launched a new casino product.” 

“‘ibet’ is our first pure B2B sportsbook customer with the plan to launch in time for the Euro 2020. Due to the current situation, launch has been postponed until the leagues and tournaments resume. Our intention is to sell our highly competitive sportsbook to external operators and we are seeing strong interest in this.

Betsson has the ambition to grow faster than the market, organically and via acquisitions. This quarter, we acquired an online gambling B2C business which is included in our books from mid-April and is expected to contribute positively to our earnings from day one.

We see strong interest in our products which are being continually optimised to create a compelling choice of entertainment and UX for the consumers. One example is the recent launch of ‘Jalla Casino’, a fast, fun and easy to play mobile casino which has received positive feedback from consumers.

The sportsbook has shown healthy growth in the first quarter. Most recently, the positive trend has been broken due to the cancellation of sporting events. However, we now see a shift to sports such as table tennis and eSports, it is an interesting increase in breadth which could be long term positive. We have added further events to our offering and believe that when sporting events gradually re-enter the betting market, our sportsbook offering will be even more powerful than before.

I am impressed with how well the Company has adopted to the current global challenge. We are performing surprisingly well with no major disruption to the business and we see no need to make any changes to our strategy or the way we operate. We will continue investing in our technology and product portfolio and will launch new products and features as planned.

The health and safety of our employees always come first, to ensure that and to contribute to society via social distancing, we are all working from home. There has been a seamless transition to remote working which reflects on the quality and dedication of our hardworking people. I am very proud to see the unique morale, commitment, passion and the way we work as a team at Betsson, which is critical to the successes of the Company.

We are a historic performer with a strong track record of creating shareholder value, we have demonstrated resilience to market fluctuations and delivered in both good times and tough times. We have a well-diversified and secure supplier base, high and stable profit margins and a strong balance sheet.

Looking ahead, when the situation has normalised, I am confident we will come out of this extraordinary situation even stronger, benefiting from our sustainable growth strategy. The offline to online transition is likely to be accelerated globally as a result of the covid-19 pandemic, creating consolidation opportunities for strong businesses. Our successful strategy continues, I am proud of this quarter’s performance and look forward to the future with confidence.”

PRESENTATION OF THE INTERIM REPORT

At 10:00 CET today 23 April, Betsson invites analysts, investors and media to participate in the results presentation of the first 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.

Audiocast link:

https://edge.media-server.com/mmc/p/jzkqeuvr

Dial-in numbers:
Sweden:                           +46 856642651
United Kingdom:              +44 3333000804
United States:                  +1 6319131422

PIN: 48401271#

For further information, please contact:

Pontus Lindwall, President and CEO Betsson AB
+46 8 506 403 00 pontus.lindwall@betssonab.com

Martin Öhman, CFO Betsson AB
+46 8 506 403 00 martin.ohman@betssonab.com

Anna-Lena Åström, Head of Investor Relations
+46 761 80 55 46 anna-lena.astrom@betssonab.com

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 CET on 23 April 2020.

About Betsson AB

Betsson AB (publ) is a holding company that invests in and manages fast-growing companies within online gaming. The company is one of the largest in online gaming in Europe and has the ambition to outgrow the market, organically and through acquisitions. This should be done in a profitable and sustainable manner, primarily in locally regulated markets. Betsson AB is listed at Nasdaq Stockholm, Large Caps (BETS). www.betssonab.com