Gambling Industry Acquisitions and Financial News — Weekly Round-up for July 27, 2018

By Brian Cullingworth, Last updated Jul 27, 2018

Greek Land Casinos Revenues Lag

Noticeable decline in H1-2018

The Greek newspaper Kathimerini reported over the weekend that the national casino market suffered a decline in the first half of the year, as both visits by punters and the money being played fell noticeably, in line with the trend recorded over the last decade.

The country’s nine casinos received 1,333,500 visitors in January-June 2018, which was down 2.3 percent from the same period in 2017, with positive growth reflected only in the results from the casinos of Thessaloniki, Parnitha in Athens and Corfu.

There was also a reported fall in turnover, as total bets in the nine casinos amounted to Euros 740 million, an annual reduction by 1.8 percent from the first six months of 2017.

The casinos’ gross gaming revenues (GGR) reached Euro 116.2 million, down 3.2 percent from 120 million in H1 of 2017. Throughout the 12 months of 2017 the sector’s GGR registered a total yearly decline of 3.8 percent.

Profits Down In MRG Trading Update

Management reports that increase in marketing spend impacted EBITDA

MRG, the parent group for the Mr Green online gambling assets reported in an H1-2018 trading update this week that it has failed to meet profit expectations despite increased revenues, with management explaining that cost of services and increased marketing spend impacted EBITDA but should be viewed as an investment.

Key performance indicators released by the company included:


  • Revenue up 43.4 percent at SEK 412,8 million (GBP 35.5 million);
  • Organic growth of 31.1 percent;
  • EBITDA of SEK 45.4 million – a 13 percent decline;


  • Revenue up 40.8 percent at SEK 793.8 million (GBP 563.9 million);
  • EBITDA rose to SEK 45.4 million;
  • Customer deposits grew by 64.3 percent.

CEO Per Norman reported:

“Profits did take a hit due to marketing expenditure increasing by more than 70 percent year-on-year in the first half of 2018, with earnings before interest and deductions over the six months falling from SEK 52.4 million to SEK 45.4 million.

“Higher marketing spend has affected EBITDA and there has been a strong focus on digital marketing, but we are very happy with the strong growth,” Norman said. “We increased marketing spend because of the strong market efficiency we were seeing, and the second (motivation) was of course due to the World Cup.

“We will focus more on cost control in the second half of the year, with marketing spend decreasing in relation to total revenue.”

“We have had another strong quarter,” Norman, advised, observing that growth had been particularly good in the Nordic region added. “We are confident we are very well prepared to deliver on our financial targets, short and long term.”

In H1-2018 Mr Green re-branded as MRG (see previous InfoPowa reports).

Strong Organic Growth At Kindred Group In H1-2018

World Cup football betting helps boost results

The Kindred online gambling group released its unaudited H1-2018 performance numbers Wednesday, reporting significant growth driven by increased punter activity during World Cup Russia 2018.

Highlights for Q2-2018 included revenue up 33 percent y-o-y at GBP 219 million, and H1-2018 revenue of GBP 427 million (H1-2017: GBP319 million).

The Stockholm-listed company said that the group active player base reached more than 1.5 million punters in Q2-2018, a 400,000 player rise over the comparative period in 2017

Operating margins remained strong across the group, enabling it to achieve a Q2-2018 EBITDA of GBP 42 million (Q2 2017: GBP 33.4 million), and GBP 89 million in H1-2018 (H1 2017: GBP 63.7 million).

Group profit reached GBP 55 million in the half-year (H1 2017: GBP 37 million) of which Q2 2018 contributing GBP 25 million (Q2 2017: GBP 20.4 million).

  • Q2’s sports betting revenue was up 43 percent year-on-year to GBP 105 million;
  • Live betting delivered 58.7 percent of turnover and 46.5 percent of revenue;
  • Casino action in Q2 saw revenue up 23 percent at GBP 104 million. Subsidiary 32Red contributed revenue of GBP 16.9 million and earnings of GBP 700,000 (the company suffered a GBP 2 million penalty from the UK Gambling Commission on a problem gambling failure);
  • Poker rose 3 percent to GBP 4 million;
  • Mobile revenue across all verticals delivered GBP 158 million, a year-on-year rise of 29 percent.

CEO Henrik Tjärnström reported:

“The World Cup provided a significant all-time high in customer activity and continued strong organic growth, and unexpected results led to a sportsbook margin of 8.2 percent after free bets. Our gross winnings revenue was up 31 percent and we recorded an all-time high in active customers

“Our underlying EBITDA grew by 25 percent compared to the same period last year (+27 percent organic and in constant currencies).

Looking ahead, Tjärnström said: “In the period up to 22 July 2018, average daily gross winnings revenue in GBP was 29 percent higher compared to the same period in 2017. Adjusting for the impact of exchange rate changes, the growth was 30 percent”.

Strong Q2-2018 Performance From Kambi Group Plc

Optimism over World Cup football revenue and the impact in the US of Supreme Court overturn of PASPA

Q2-2018 has brought good news for the sports betting industry, according to Kambi Group plc, which released its latest quarterly result Wednesday, reporting strong performance figures.

The success of the World Cup football and the optimism around US sports betting following the overthrow of PASPA by the US Supreme Court in May have all contributed to a brighter business outlook, with the company reporting highlights of:

  • Q2-2018 revenue up 25 percent y-o-y at Euro 17.6 (14.1) million;
  • H1-2018 revenue up 20 percent at Euro 34 (28.3) million;
  • Q2 operating profit at Euro 2.4 million (Euro 300,000) with margin at 14 percent (2 percent);
  • H1 operating profit of Euro 4.4 million (1.6 million) with margin at 13 percent (6 percent);
  • Profit after tax of Euro 1.7 (0.1) million for the second quarter of 2018;
  • Profit after tax in H1 at Euro 3.2 (1.2) million;
  • Cash flow from operating and investing activities (excluding working capital) at Euro 1.9 (-0.5) million for the second quarter of 2018;
  • Cash flow from operating and investing activities in first half Euro 2.5 (0.3) million.

Key developments included:

  • Signed two US-based customers in DraftKings and Rush Street Gaming after US Supreme Court’s decision to fully repeal its federal sports betting ban;
  • Signed Stanleybet Romania in Q2 and ATG and Latvijas Loto in Q3;
  • Finalised long-term contract renewals with Kindred Group and Mr Green.

CEO Kristian Nylén said that the US Supreme Court’s overturn of PASPA created the potential for significant business for Kambi, which was prepared and moved quickly following the ruling to partner with two US operators.

“I’m excited about what we can achieve with both customers, and in the US more generally,” Nylén said. “However, the state-by-state roll out of regulated sports betting will not happen overnight, therefore our US-facing business should be viewed in the mid-to-long-term.

“In parallel, we continue to focus on our core business, which was boosted in June by the early stages of the World Cup.

“Ahead of the World Cup, we launched three new customers into three regulated territories within the space of a week, demonstrating the scalability and capacity of the Kambi platform. We also announced we were in final stage commercial discussions with Swedish horse racing operator ATG, a deal we subsequently closed shortly after the end of Q2.

“In early July we finalised our new long-term agreement with Kindred Group, a deal which gives Kambi a secure platform for future growth. Over the years, Kambi and Kindred have developed a strong partnership and I look forward to building on this in the future.

“Overall, the past few months have produced very positive results for Kambi, both operationally and commercially, and I look forward to continuing this progress throughout the remainder of the year.”

Lottery Sales Remain High In China

Sports lottery continues to lead

China’s Ministry of Finance has released the latest figures on official and legal lottery sales, advising that performance remained strong in H1-2018 with overall sales up 19.6 percent y-o-y at 245.2 billion yuan ($36 billion).

The Sports Lottery generated the most sales at 134.6 billion yuan ($19.88 billion), up over 36 percent, whilst Welfare Lottery sales came in at 110.6 billion yuan ($16.34 billion) in H1 2018, up 4.2 percent y-o-y.

The Ministry noted that lottery sales for the first half were lifted by the FIFA World Cup, which was held between June 14 and July 15. Data showed that lottery ticket sales in June soared 73.2 percent to 58.6 billion yuan ($8.66 billion).

Sports lottery sales more than doubled in June 2018 at 39.5 billion yuan vs. 16 billion yuan in the comparative period in 2017. Welfare Lottery sales in the same period rose just 7.1 percent year-on-year to 19.1 billion yuan.

Guangdong province recorded the highest lottery sales over the half-year at 23 billion yuan – a 15.8 percent year-on-year improvement, with Jiangsu province also delivering good numbers – 20.9 billion yuan and a 28.2 percent improvement on the same period in 2017.

Playtech Acquires Remaining Snaitech ‘Squeeze Out’ Shares

Group now owns approximately 96.5 percent of the total issued share capital

Playtech plc announced Thursday that following its June 22 launch of a mandatory takeover bid for the remaining shares of Italian gambling group Snaitech, it has reached the end of the acceptance period for the Mandatory Takeover Offer, and including market purchases to date, now owns approximately 96.5 percent of the total issued share capital of Snaitech.

As a result of the above, Pluto (Italia) S.p.A., a wholly-owned subsidiary of Playtech, has announced that it is initiating the necessary steps for the transfer of the remaining approximately 3.5 percent minority shareholdings in Snaitech it does not own under article 111 of Italian Financial Services Act.

The shareholders of Snaitech that are subject to this Squeeze Out provision will receive cash consideration equal to 2.19 Euros per share as noted in the Mandatory Takeover Offer.

It is expected that Snaitech’s shares will be suspended from trading on 1 August 2018 and 2 August 2018 and that, following completion of the Squeeze Out, will be de-listed from Mercato Telematico Azionario, organised and managed by Borsa Italiana, on 3 August 2018.

Brian Cullingworth

Infopowa news was a staple of Casinomeister’s news from 2000 until 2019. Brian Cullingworth was the main writer, contributor, and was one of the most knowledgeable persons I have ever known involved in the online casino industry.

We first met in January 2001 at the ICE in London where I observed him going booth to booth interviewing online casino, software, and licensing jurisdiction representatives. Brian was also heavily involved with our forum as “Jetset“, he was involved as an informal consultant to eCOGRA, the OPA, and was a player advocate who assisted countless aggrieved players with his connections to industry folks. He also published “Casino Cautions” via Infopowa news for quite a number of years. These can be found in our news archives.

His passing in February 2019 was a dark day for us. He will be forever missed.

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