Raketech lowers Swedish dependency as growth diversifies to Japan and US

Raketech has reported strong growth across all core metrics for Q1 2021, recording an annual growth rate of 27% with market success in the US and Japan identified as key driving factors.

Overall group revenues reached €8.3 million (Q1 2020: €6.5 million), whilst earnings derived from sports increased to 17% of group trading – representing an annual increase of 27%.

Casino continued to be the dominant group asset, accounting for 82.5% of overall revenue as opposed to 78.5% 12 months prior, whilst earnings generated from other sources fell from 5% to 0.5%. 

Operating profits stood at €1.6 million (2020: €1.4 million), representing a yearly increase of 14.2%, whilst a 22% growth in EBITDA was also recorded at €3.2 million (2020: 2.6 million).

Non-Nordic revenue rose to 35%, with Japan highlighted as standing out positively, having delivered record numbers on all KPIs ranging from traffic and sessions to monetisation.

In addition, Raketech operations in the US proved profitable, as a combination of the Super Bowl and entry into the states of Virginia and Michigan following the successful awarding of gaming licences ‘significantly pushed the needle’ during the mid-quarter period.

Raketech maintains progress in diversifying its geographic revenue mix away from its Swedish home market dependency –  as income generated from Sweden now represents 38% of total group revenue, as opposed to 55% in Q1 2020. 

The publisher outlined market expansion in the Japanese and US betting and gaming sectors in order to acquire additional sources of revenue as the primary methods for breaking the Swedish dependency.

Japan in particular was identified as ‘leading the way’, accounting for 11% of global revenue, whilst US operations represented 6% – a figure Raketech stated should be ‘interpreted as a sign of its high ambitions on the American market’.

Although the acquisitions of AmericanGambler and Lead Republik led to direct company expenditure increasing to €2.9 million (2020: €1.6 million), these takeovers were identified as key drivers as revenue growth for the company.

However, the group did acknowledge that the earnings increase as a result of these mergers was partially offset by a reduction in revenues following the disposal of consumer finance assets during the fourth quarter of 2020.

Furthermore, the aforementioned ‘needle’ was also ‘slightly pushed back’ to some extent by low seasonality on other markets as well as increased gambling tax in Denmark and payment blocks in Norway, whilst Casinofeber also reported lower revenue than previously.

“I am pleased to be able to conclude that the positive momentum we showed in Q4 continued into Q1 and resulted in yet another stable quarter,” said Oskar Mühlbach, Raketech Group CEO. “Furthermore, April revenues amounted to EUR 2.8m, despite the US slowing down slightly after the Superbowl peak. 

“The Raketech team is currently focusing on ensuring we maximise the potential from the European Championships in Football coming up in June in addition to our continuous efforts to ensure we deliver on strategic goals with regards to geographical expansion and commercial diversification, through R&D as well as M&A.”

Mühlbach finished his statement by bidding farewell to Chairman of the Board Christian Lundberg – who declined re-election at Raketech’s AGM in May – and welcomed incoming Chairman Ulrik Bengtsson, the incumbent CEO of William Hill.