Greek lottery and betting operator OPAP started 2019 off with its best quarterly revenue performance in nine years.
On Wednesday, OPAP released its first quarter financial report card, which showed overall revenue rising 5% year-on-year to €396m in the three months ending March 31. Earnings improved 28% to €156m while net profit shot up 43.5% to €57.2m, although this would have risen by a slightly more modest 25% excluding a £7.4m one-off benefit.
The revenue figure is OPAP’s strongest quarterly result since 2010, reflecting the ongoing rollout of its 25k video lottery terminals (VLT). VLT revenue hit €68.9m, up 59% year-on-year and VLT share of overall revenue was up nearly six points to 17.4%.
A court ruling in April cast doubt on the legality of the government’s awarding of OPAP’s VLT concession, but OPAP insists the ruling is “purely procedural.” OPAP had installed nearly 20k of its VLTs by the end of Q1, only 1k higher than at the end of 2018, but the company expects to have installed the full complement of machines by the end of the year.
OPAP’s mainstay lottery operations saw revenue inch up 1.6% to €191.7m but the company anticipates greater gains through the rest of the year thanks to the late-March launch of Tzoker, its first online lottery product. Tzoker is the company’s most popular offline lottery product and the company says excitement over the product helped push year-to-date online customer sign-ups above 75k.
Sports betting revenue fell 5.3% to €101.7m, but OPAP noted that this figure was 1.9% higher from Q4 2018. Live betting accounted for 36% of total wagers, up more than one-quarter year-on-year.
OPAP had 6,328 Playtech-powered self-service betting terminals (SSBT) installed in Greece and Cyprus by the end of Q1, and SSBTs accounted for 15.3% of Q1 betting revenue, up from 6.7% in the same period last year. The SSBT share of live wagering was significantly larger (27.6%) than pre-match betting.
OPAP’s Greek retail profile continues to grow, rising by 147 shops at the end of Q1, pushing the total complement to 3,884.
OPAP is still waiting on regulatory approval for acquiring majority control of TCB Holdings, the parent company of the Stoiximan Group, which operates online gambling in Greece and Cyprus. Stoiximan also operates in Austria, Germany and Romania via the Betano brand, which made its debut in Portugal’s regulated online gambling market last month.
Tora Wallet, OPAP’s new retail/online payment subsidiary, had processed 390k transactions by the end of May, and the company expects that to surpass 500k by the end of June. The Tora mobile app is in its “final implementation stage,’ with an expected launch in H2.