Betsson revenue record; Svenska Spel mutters; Sweden drops App Store purge

TAGs: Apple, Betsson, Betsson AB, lotteriinspektionen, Svenska Spel, Sweden

sweden-betsson-svenska-spel-appleSwedish betting operator Betsson AB has continued its positive momentum from 2014 by posting a new quarterly revenue record.

Betsson released a trading update on Friday showing revenue up 24% to SEK 847.4m (US $98m) and net income up 42% to SEK 224.1m in the three months ending March 31. Mobile revenue was up 131% to SEK 233.3m, representing 28% of the overall pie. Betsson’s dominant casino vertical saw revenue rise 28% to SEK 585m while sports betting turnover was up 60%. Customer deposits rose 43%.

Much of the gains are attributable to the February 2014 acquisition of the Dutch-facing Oranje and Kroon casino brands but Betsson says organic revenue growth was up 14%. Betsson’s Q1 operating margin of 28.1% was its highest figure in three years.

Betsson CEO Magnus Silfverberg claimed the results validated the company’s “multi-brand strategy of migrating a number of brands to one shared technical platform.” The Techsson platform is currently responsible for 87% of group revenue and the stragglers will be migrated before the year is through. Betsson recently shuttered its DanmarksAutomaten and Maximo brands and merged their customer databases with and CasinoEuro respectively.

Silfverberg told analysts that the company had assumed full ownership of Betsson’s Peru-facing site, which previously had been run on a B2B basis. Silfverberg declined to comment on rumors that Betsson was considering a €100m acquisition of Georgian operator Europe-Bet.

Swedish state-run gambling operator Svenska Spel had a decidedly less rosy Q1, with revenue falling 4.7% to SEK 2.2b and profit down 4.2% to SEK 1.19b. Svenska Spel’s online revenue offered a brighter note, rising 5.5% to SEK 421m and mobile revenue improved by 53%. The firm estimates it holds a one-fifth share of Sweden’s overall online gambling market but expects this to grow if the government grants its request to add an online casino vertical.

The state monopoly continued to bitch about international online competition, which it claims is spending $3m per day marketing their wares to Swedish punters. Svenska Spel CEO Lennart Käll claimed this represented 75% of the sector’s total marketing outlay.

Käll said Svenska Spel’s margins had improved in Q1 thanks to cutbacks of its own marketing efforts. Left unsaid is that the monopoly was basically forced to curtail its marketing in an attempt to justify Sweden’s gambling laws, which are the subject of a European Commission legal action. The EC allows states to maintain gambling monopolies if their aim is to reduce gambling participation, a theory completely undone by Svenska Spel’s increased advertising presence over the past few years.

Meanwhile, Swedish gaming regulator Lotteriinspektionen has dropped its challenge of the legality of online gambling apps in Apple’s App Store. In February, the regulator sent Apple an “informative letter” questioning the legitimacy of betting apps from companies like Betfair, Bet365, Betsson, PokerStars and others. In response, Apple yanked around 40 apps from the Swedish App Store.

On Friday, eGaming Review reported that the Lotteriinspektionen had decided to let the matter slide. As a result, the apps in question have begun reappearing in the App Store. Gustaf Hoffstedt, general secretary of the Association of Online Gambling Operators in Sweden, told eGR that his group was pleased that “everyone now understands that it is legal according to EU law for Swedish consumers to gamble with operators holding an EU license.”


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