Betsson achieves growth despite currency concerns
Betsson saw an 11-per-cent year-on-year increase in revenue during 2016.
The Swedish gaming operator, in a trading update, brought in SEK4,117 million (€434,000/$462,000) during the 12 months to December 31.
Its casino division, which made up 71 per cent of total revenue, saw a 14-per-cent rise to SEK2,907 million.
Operating income amounted to SEK946.4 million, up around seven per cent, and the operating margin was 23 per cent. Net income was up almost six per cent year-on-year at SEK 878 million.
In evaluating 2016, Betsson’s management was pleased with the company’s ‘positive development’ as it overcame severe currency fluctuations and lower betting margins impacts in H1 2016.
“Betsson’s positive development continues and the first quarter 2017 has started strong,” said Ulrik Bengtsson, chief executive at Betsson.
“The stable casino business was 74 per cent of revenue in the fourth quarter and Betsson’s brands continue to gain market shares in the segment. Also Betsson’s largest region, the Nordics, grew faster than the market and region Western Europe returned to growth.”
Betsson said an increase of deposits by 14 per cent and record level in active players shows “a strong underlying momentum”.
In total, the growth in Q4 was 7.4 per cent, despite decline in region Central and Eastern Europe and Central Asia (CEECA), compared to the fourth quarter in 2015.
Bengtsson added: “Betsson has made significant investments in product development throughout 2016, which has pushed the casino growth.
“The sportsbook investments are expected to have a positive effect in 2017. The acquisition of the horse betting operator RaceBets adds an important product to Betsson’s sportsbook offering and adds revenue from mainly locally regulated markets.
“The share of revenue from locally regulated markets is increasing, in accordance with our strategy, and is now close to 20 per cent.
“Increased investments in product development, higher share of revenue from regulated markets and less revenue from countries with high margin have had a negative impact on earnings during the year.
“The operating margin for the full year was 23 per cent despite a very weak second quarter. This shows that Betsson has a good balance in its business and can absorb both temporary revenue decline and increased costs, over time.”
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