The 2018 FIFA World Cup gave a golden boot up the backside of Nordic online gambling operator Betsson AB in the second quarter of 2018.
On Thursday, the Swedish-listed Betsson released its Q2 earnings report, which showed revenue rising 14% to SEK1.35b (US$150.5m) in the three months ending June 30. Operating income improved 45% to SEK300.7m while net income was up 46% to SEK 271.4m.
Betsson investors had endured several consecutive quarters of significant earnings and profit declines, and the company had warned in February that righting the ship could take until the end of 2018. On Thursday, Betsson CEO Pontus Lindwall said the company had seen “progress in some areas” but suggested it would be some time “until we see sustainable improvements.”
Sportsbook revenue was up 17% to SEK300.2m in Q2, with mobile accounting for two-thirds of that total. Betting turnover rose 8% to SEK 6.2b, due largely to the influx of World Cup bettors. The company saw active customers spike more than one-quarter in Q2.
Casino revenue was up 16% to just over SEK1b, over 60% of which came via mobile devices. The casino vertical’s share of Betsson’s overall revenue improved two points to 76% during the quarter.
The casino vertical was largely credited with driving a 26% rise in revenue from Betsson’s Western European markets, which contributed SEK443.5m to the Q2 total. The dominant Nordic markets were up 11% to SEK622m, while Central & Eastern Europe and Central Asia revenue declined 5% to SEK214.4m.
Lindwall credited the significant earnings growth to improved efficiencies, which boosted the operating margin by nearly five points to 22.3%. Operating income growth came despite a “negative impact” from the UK-facing NetPlay operation, one of several Betsson bolt-ons during the ill-advised acquisition binge under its former CEO.
Lindwall said the company’s mergers and acquisition activities were “temporarily on hold” until it could get its existing operations in order through a mix of product improvements, better efficiencies and growth in core markets.
Lindwall said Q3 had started off on a positive note, but cautioned that much of this improvement was due to the second half of the World Cup and shouldn’t be regarded as guidance for the full quarter.
