Pontus Lindwall, president and CEO of Betsson, believes that the firm demonstrated an ability to deliver profitability “during the challenges that 2019 entailed,” as a series of declines were reported across key metrics in the company’s latest financial report.
With developments in Sweden, Norway and the Netherlands said to have continued to be weak, Betsson reported a ten per cent revenue drop for 2019’s final quarter to SEK 1.28bn (2018: SEK 1.43bn). On a full-year basis this declined five per cent from SEK 5.41bn to SEK 5.17bn.
Mobile revenue amounted to SEK 920.4m, decreasing 2.9 per cent from SEK 948m, however the figure represented 71 per cent of total revenue as opposed to 66 per cent the year earlier.
“We had expected some recovery in the closing fourth quarter, above all in the Swedish market, but we did not reach our objectives there,” Lindwall commented.
“Up until now, one year after the Swedish re-regulation, we have still not seen the market consolidation that we expect due to the great number of operators, many of them showing no profitability.”
Gross profit for the quarter dropped 18 per cent to SEK 838.8m (2018: SEK 1.01bn), which on a full-year basis resulted in an 11 per cent decrease from SEK 3.85bn to SEK 3.42bn. EBITDA fell 30 per cent and 18 per cent for Q4 and FY respectively, finishing at SEK 292.3m (2018: SEK 419.4m) and SEK 1.22bn (2018: SEK 1.5bn).
Casino revenue amounted to SEK 964.1m, a decrease of 10 per cent from SEK 1.07bn, staying consistent year-on-year by representing 75 per cent of group revenue. Mobile casino revenue fell 4.1 per cent to SEK 654.9m (2018: 683.5m), and accounted for 68 per cent (2018: 64 per cent) of total casino revenue.
Sportsbook revenue in the fourth quarter amounted to SEK 311.6m (SEK 341.4m), a decrease of nine per cent from SEK 341.4m, and also stayed consistent by representing 24 per cent of total revenue.
Mobile Sportsbook revenue amounted to SEK 260.1m, in line with the fourth quarter of 2018, and accounted for 83 per cent (2018: 76 per cent) of sportsbook revenue.
Revenue from the Nordics during Q4 finished at SEK 450.2m (2018: SEK 659.3m), a decrease of 32 percent, with Western Europe dropped 15 per cent from SEK 455.1m to SEK 387.7m. Revenue from Central and Eastern Europe and Central Asia amounted to SEK 369.9m (2018: SEK 269.8m), an increase of 37 percent.
Lindwall added: “During its long history, Betsson has grown more than the market. In 2019, we had a notch in this curve, but our long-term ambition to grow more than the market, organically and through acquisitions, remains. Our efficient organisation, the strong cash flow and the strong financial position provide a good foundation for acquisitions.
“During the fourth quarter we made a minor strategic acquisition and continue to analyse several opportunities, both in locally regulated markets and in markets that will be regulated. By further increasing the geographical distribution, we can reduce the impact of temporary downturns in individual markets.”