B2B revenue drives Aspire H1 growth

20 August 2019

iGaming solutions provider Aspire Global’s B2B revenue increased 76.5% in the first half of 2019, pushing group revenue for the period to €66m (£60.5m/$73.1m).

The company saw an increase in B2B deposits, from €40.7m to €74m, and in total number of B2B transactions, to 1.27bn, up from 715.8m last year. These figures helped B2B revenues increase to €43m, up from €25.2m last year.

“I am very proud of the strong progress for our B2B-business, currently constituting around 60% of total revenue and almost 70% of EBITDA,” chief executive Tsachi Maimon said. “This is the result of our consistent strategy to focus our efforts on the right partnerships, all while improving our offering and optimizing the business set-up. It is certainly gratifying to see the results of our hard work being reflected in many of our KPIs."

B2C revenue also increased, from €21m to €27m, helped by a 15.3% increase in deposits from first-time depositors to €75.3m. The number of active users increased to 119.5m, up from 98.5m last year.

The Nordic region contributed €13.4m of the company’s revenue from the period, a decline from €14.1m last year. Revenue from the UK and Ireland increased 9% to €9.7m, but the vast majority of the company’s growth came from the rest of Europe, where revenue increased from €19m to €41m. Revenue from the rest of the world increased from €1.1m to €1.9m.

The company paid €42.8m in distribution expenses, up 69.2% from last year. Gaming duties increased from €2.1 to €2.4m, while administrative expenses increased from €6.4m to €7m, bringing total expenses to €52.1m, up 54.4% year-on-year.

Earnings before interest, tax, depreciation and amortization increased 43.3% to €12.1m. Financial expenses increased by 107% to €2.1m, leading to a net profit of €9.1m, up 21.3% from last year.

In the second quarter of 2019, B2B revenue increased 51.4% to €21.5m, resulting in group revenue increasing €31.8m, up from €24.2m in the prior year.

However the contribution from the Nordic region fell from €7m in Q2 2018 to €6m, which Aspire blamed on tough regulatory conditions in the Swedish market. Revenue from the UK and Ireland also fell, from €6.1m to €5m. This was offset by strong growth across the rest of Europe, where revenue increased by 90.8% to €20.8m, with the rest of the world contributing a further €1.0m.

Distribution expenses for the company increased from €13.8m to €21.3m, while gaming duties totalled €1.2m and administrative expenses declined 8.5% to €3.2m. However, while earnings before interest, tax, depreciation and amortization increased, increased financial expenses and losses from foreign currency exchange differences meant that net income declined for the quarter from €5.3m to €4.2m.

Maimon said that going forward, the company would continue the emphasis on B2B and new markets that led to increased revenue in 2019, and that he believed new partnerships would help the company continue to grow.

“We will continue to focus on B2B, entering additional new markets and extending the offering for some of our main brands to include more than one vertical,” Maimon said. “We are also excited about the upcoming launches together with our recent partners, one of which is Apex Marketing and the other is Codere Group who will be expanding their online offering to Northern Europe over our platform.”

This will be supported by the €13.1m acquisition of games developer Pariplay, agreed in July. The deal, Aspire said, would allow it to cut costs, broaden its game portfolio and provide a channel to sell games, including proprietary titles, outside of its partner network. The supplier is also licensed in New Jersey, which Aspire said would allow it to expand into the US market.