Greek betting operator OPAP saw profit rise 41% last year thanks to aggressive cost-cutting, new product launches and the 2014 FIFA World Cup.
OPAP reported revenue up 14.8% to €4.26b and profits up over €58m to €199.2m in its first full year of operations since the Greek government sold its one-third stake to the Emma Delta consortium. The new bosses imposed a raft of cost controls, including a voluntary redundancy program, a 56.5% drop in donations/grants and a 31% cut in sponsorship expenditure.
OPAP CEO Kamil Ziegler credited the uptick to the successful launch of a new lottery scratch card that contributed revenue of €203m. OPAP also enjoyed a solid performance by its Joker lottery product, which reported revenue up 28.5% to €267m. OPAP’s Stihima sports betting product saw revenue rise 21% to €1.5b thanks to the World Cup but revenue from OPAP’s flagship Kino product fell 1.6% to €2b. Gross gaming revenue rose 20.5% to €416m in Q4, the sixth consecutive quarter of positive traction.
Ziegler took pains to point out that OPAP contributed “significantly higher proceeds” to the cash-strapped Greek government in 2014, making OPAP “the largest taxpayer” in a country notorious for its tax-evading nature.
Looking ahead, OPAP has great expectations for its video lottery terminal (VLT) business, which will roll out 16,500 terminals this summer, the first installment of a promised 35k new machines.
OPAP also breathed a sigh of relief after the Hellenic Republic Asset Development Fund (HRADF) announced last week that the €40m, 20-year pari-mutuel betting monopoly license OPAP received last fall would go ahead as planned. HRADF’s privatization plans were thrown a wobbler in January when the country’s new left-wing government suggested that such schemes might be rethought. Syriza party officials have since confirmed that these concerns won’t extend to already done deals.