Betsson revenues dip on Dutch and Sweden struggles
Company revenues down 5% in Q2 and reregulation in core Sweden market bites
Betsson has reported a 5% drop in Q2 revenues to SEK1,277.7m (£104m) following declines in its home Swedish market and a drop-off in the Netherlands.
Group EBITDA fell 24% to SEK287.4m (£24.5m) which Betsson said was attributable to challenges in core markets, with Nordics revenues down 17% year-on-year and 11% quarter-on-quarter.
Western Europe was down 12% YoY, with Regulus Partners estimating therefore Netherlands revenue was down c. 40-45% as the operator was forced to rebrand its Oranje Casino and Kroon Casino sites and make other changes to stop targeting Dutch consumers.
Elsewhere, Betsson saw organic growth of 46% in CES (now 22% of overall revenues) and 23% in rest-of-world.
“Betsson can still outperform [in grey markets] and with 64% of Betsson’s revenue footprint still not locally taxed or regulated, this represents a significant area of (potentially risky) mitigation,” Regulus noted.
By vertical, casino revenues in Q2 fell 10% while sportsbook climbed by 14%
Betsson CEO Pontus Lindwall said the results were due to changes in the wider gambling industry, changes which had posed challenges in several of the groups key markets.
Lindwall confirmed that the company had made several adjustments to ensure it will be able to obtain a Dutch licence “as soon as possible”.
“Following a negative impact on revenues in direct connection with these adjustments, revenues have stabilised and we are convinced that Betsson is properly positioned for long term development and growth in the Netherlands,” Lindwall added.
Analysts Regulus Partners said Betsson had “done much to improve its offer and overall growth positioning”, but the recent declines in its revenues proved that “keeping ahead of the regulatory salami slicer” was a significant challenge for the business.
Addressing the issue of Betsson’s expansion into the Dutch market, Regulus said that the question of whether Betsson’s remedial action will be enough to ensure compliance with Dutch regulations had still to be answered.
The Dutch regulator confirmed this week that operators seeking a Dutch remote licence must not have actively targeted the Dutch market in the two years prior to their licence application.
Betsson only rebranded Oranje Casino and Kroon Casino sites in April 2019, suggesting it could be forced to wait to apply until April 2021.