Increased profitability and a higher operating margin characterize the second quarter of the Svenska Spel Group. This is despite the fact that the result is negatively affected by the challenges for Casino Cosmopol and the slot machines
“We continue to simplify and improve the gaming experience for customers and our focus on sustainable gaming is having a positive effect. The percentage of healthy revenues and the number of sustainable customers is increasing, while risky gambling is decreasing,” he says. Patrick Hofbauer, President and CEO of Svenska Spel.
Group net sales for the quarter are SEK 1.967 million (1.963), up slightly from the same quarter last year. Operating profit of SEK 550 million (531) is an increase of 3% or SEK 18 million, despite a negative impact on earnings for the Casino Cosmopol & Vegas business area, which decreased by SEK 29 million of Swedish kronor. The operating margin strengthened and amounts to 28% (27). For the Group as a whole, online business increased 9% over the same quarter last year and accounted for 52% (48) of Group revenues in the quarter.
Net gaming revenues for the Sports & Casino business area increased 6% during the quarter compared to the same quarter last year. The increase is driven by, among other things, pool games such as Stryktipset, good margins in sports betting, growth for online casinos and a general increase in the number of customers in the business area.
The Tur business area increased net gaming revenues by 1% over the corresponding quarter last year. Eurojackpot continues to drive revenue and broke sales records during Midsummer Week when the jackpot was a maximum of 1,4 billion SEK.
For the Casino Cosmopol & Vegas business area, net gaming revenue decreased 13%. Operating loss of -SEK 52 million is a decrease of SEK 29 million from the same quarter last year. This is mainly due to the ever-increasing competition from online gambling, which among other things leads to fewer guests and lower revenues. Another reason is the strengthening of measures in the work on due diligence and against money laundering. This has a negative impact on revenue, but has a positive effect on healthy revenue. The Casino Cosmopol & Vegas business area is now facing the challenges of a business transformation, which includes measures to reduce costs.
During the quarter, a new poker platform was launched offering customers a wider range of games and an even better mobile experience. By partnering with one of the largest poker networks in the world, customers also get more tournaments and bigger prize pools. In sports betting, PIX Mixen was launched in stores, a game based on four pool games. In number games and lottery tickets, three new digital tickets have been launched. There were also winning weeks for Keno with unique experience wins and an increase in the number of prize money, as well as the Second Chance drawing at Lotto. Poker-SM was held at Casino Cosmopol with more than 400 attendees, and two new games were launched on the slot machines.
The customer experience has been enhanced through the ability to correct tickets in manned tills at gaming agents. The launch of the new digital service Ombudsportalen facilitates communication with approximately 5.000 agents of Svenska Spel.
During the quarter, Svenska Spel distributed 95 million prizes in number games and lottery tickets with a total value of over SEK 268 million. The highest win was over €63 million at Eurojackpot. Sports and casino gaming produced 25 million wins during the quarter, including 19 million wins on Stryktipset and Europatipset.
In the previous quarter, risky gambling among Svenska Spel customers decreased compared to the same quarter last year. This trend continues in the second quarter. An important reason for the decrease is the strengthening of responsible gaming measures. The share of healthy revenues and the number of sustainable customers also increased during the quarter.
Starting with this interim report, Svenska Spel reports semi-annual key figures showing the percentage of customers who have been contacted following signs of risky gambling and what effect these contacts have had. The result shows that the measures have a positive effect and that 7 out of 10 customers reduced their gambling after being contacted by Svenska Spel.
On the occasion of the Swedish Gambling Award, Svenska Spel received an award for its support to research into problem gambling, where the Group has contributed over SEK 60 million since 2010. Research support is an important part of long-term value creation for Svenska Spel's customers, owners and employees.
Summary of the second quarter
- Net gaming revenue for the Group was SEK 1.967 million (1.963), an increase of SEK 4 million or 0%.
- The online sales channel increased by 9%.
- The share of healthy revenues and the number of sustainable customers increases compared to the same quarter last year.
- Group operating profit was MSEK 550 (531), an increase of MSEK 18 or 3%.
- The operating margin was 28% (27).
- Group profit was MSEK 474 (425), an increase of MSEK 49 or 12%.
- Image value stands at 50% (51) and remains the highest among gaming companies.
- Sport & Casino has launched a new poker platform with a wider range of games.
- Improved customer experience with the ability to correct lottery tickets at agent checkout.
- Ombudsportalen is a new digital service that facilitates communication with around 5.000 agents.
- Winner of the Swedish Gambling Award for supporting problem gambling research.
Summary of the January-June period
- Net gaming revenue for the Group was SEK 3.943 million (3.898), an increase of SEK 45 million or 1%.
- The online sales channel increased by 8%.
- Group operating profit was MSEK 1.162 (1.127), an increase of MSEK 35 or 3%.
- The operating margin was 29% (29).
- Group profit was MSEK 981 (892), an increase of MSEK 89 or 10%.
- Svenska Spel is the best in the industry in the Sustainable Brand Index as the most sustainable gaming company.
- Sport & Casino has launched Motang, a new online casino.
- Launched winning weeks for Keno, several digital tickets and improvements to existing games within the Group.
- Casino Cosmopol hosted the Swedish Championship of Poker and Stockholm Casino and celebrated its 20th anniversary.
