B2B plans on hold for Betsson despite strong Q1 opening

Betsson AB has reported a strong opening to 2020 trading, as the company moves to significantly expand its B2C portfolio and sportsbook capacities.

Publishing its Q1 2020 trading update for the three month period ending 31 March, Betsson recorded group revenues of SEK 1,417m (€130m) – up 7% on corresponding Q1 2019’s SEK 1,333m.

Betsson attributed growth during the period to a strong sportsbook performance, generating income of SEK 384.9m (Q12019: SEK 298m), while its flagship online casino division maintained revenues at SEK 1014m (Q12019: SEK 1011m).

“We had a strong first quarter in all areas and I look forward to the future with confidence,” said Pontus Lindwall, President and CEO of Betsson AB. “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.”

Facing a tougher regulatory backdrop across Nordic and Western European markets, Betsson revealed that company duties had increased by 20% to SEK 506m (€45m), corresponding to 35% of group revenues.

Countering home market headwinds, Betsson has continued to diversify its regional make-up. The company detailed strong revenues for its Central & Eastern Europe and Central Asia (CEECA) assets at SEK 424.7m (Q12019: 248.2m), an increase of 71%.

Further group expenses during the quarter totalled SEK 474m, which Betsson attributed to M&A costs and expanding resources to improve its technology platforms.

Closing its Q1 2020 accounts, Betsson recorded a 2% increase in EBITDA to SEK 353m (Q12019: SEK 346m) combined with a 2% increase in group operating profits to SEK 260m (Q12019: SEK 355m). 

For the remainder of 2020,  Betsson highlighted that the company will move to significantly expand its B2C portfolio, having acquired the brand portfolio of Gaming Innovation Group (GiG) during Q1 trading.    

Lindwall added: “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.”

The company maintains its plans to launch a B2B sportsbook segment during H2 trading, despite its schedule facing COVID-19 interruptions.

 Lindwall continued: “‘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 area.”

Betsson signed off its trading update by detailing no major changes to its overriding corporate strategy or product planning, with the company expressing its confidence in navigating COVID-19 disruptions.

Lindwall concluded: “I’m impressed with how well the Company has adapted 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.”

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