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LeoVegas AB has posted stagnant financial results, with corporate performance dogged by market exposures to changed regulatory conditions within the Netherlands and Germany.
Publishing its Q4 trading statement, the firm saw its period like-for-like corporate revenues maintained at €98 million.
The Stockholm-listed operator informed investors that “excluding Germany and the Netherlands”, period revenues would have increased by 26%.
Q4 adjusted EBITDA was registered at €11.5 million, reflecting a 1% increase on 2020 results of €11.4 million – a better than anticipated outcome in light of cessation of all Dutch market services during the trading period.
Awaiting its Dutch licence – and realigning its German platform and products – player growth remained stagnant across LeoVegas brands at 460,000 depositing customers.
Meanwhile, period EBIT fell by 3% to €8.4 million (Q42020: €8.7m) as the company further notified that its NGR from locally taxed markets had increased to 74% (67%).
Group CEO Gustaf Hagman commented on Q4 results, saying: “In the fourth quarter, sales were unchanged compared with the preceding year. However, excluding Germany and the Netherlands, growth was some 26%, which demonstrates our strong underlying growth.
“Adjusted EBITDA improved somewhat year-on-year, despite ceasing to provide our services in the Netherlands while waiting for a gaming licence, which was previously one of our most profitable markets. At the same time, we have paid more gaming taxes than ever before during the quarter. The improved profit was achieved through good cost control and higher marketing efficiency.”
Reflecting Q4 headwinds, LeoVegas’ full-year 2021 corporate revenues stood at €391 million, up 1% on FY2020 results of €387 million.
Struggling topline results saw it suffer a 19% drop in FY2021 adjusted EBITDA to €44.6 million (FY2020: €55m) as cash flow from operating activities declined to €45 million (FY2020: €69m).
Countering challenging trading conditions, the firm remains confident in its ability to achieve growth within its home market of Sweden (GGR +36%) which, during Q4, recorded its best trading performance. That helped offset continued Western European market declines (-39%).
Further initiatives will see LeoVegas expand its sports betting vertical, in which the company continues to develop the proprietary resources of Nordic heritage bookmaker Expekt – a new brand acquired in 2021.
The company also underlined its position as one of the sector’s most geographically diverse and competent operators. Leadership said it seeks to expand its ‘Rest of World’ (RoW) make-up with North America, to quickly surpass revenues generated within mature European markets.
Hagman added: “The new launch of Expekt has been a major success, with sales increasing almost fourfold since the acquisition. We are now planning to expand into more markets. We have also commenced establishing operations in the US, where the online gaming market is still in its infancy.
“We are seeing significant potential for a smartphone-oriented casino expert like LeoVegas in North America, where we already hold a leading position in Canada. We also invested in our own gaming studio during the year. The first games are expected to be launched shortly and over 15 titles are planned for 2022. Our own contents provide us with a more unique gaming experience, greater customer loyalty and lower costs.”
