Betsson shares spike on the back of record EBIT in Q1

Betsson has posted a 12% year-on-year (YoY) jump in Q1 revenue despite a negative impact in Argentina following the ascension of new president, Javier Milei.

The operator reported revenue of €248.2m in the first three months of the year, up from €221.9m in Q1 2023, which the firm noted included a 25% organic increase.

The revenue spike was driven by a strong performance in casino, with revenue for the vertical shooting up 18.7% while sports betting revenue dipped 2.5%.

The news has sent Betsson’s share price leaping almost 12% in early trading.

However, bosses noted that following Milei taking office in Argentina in December 2023, the Argentine peso lost more than half its value.

Betsson said this had a subsequent negative effect on revenue for Q1, with the operator live in three provinces in the Latam nation.

In fact, Argentina did display growth compared to Q1 2023, but the negative impact of currency depreciation took its toll.

Betsson also noted a record quarter for EBIT of €57.9m, up 35% on Q1 2023’s €43m, along with a 32% leap in EBITDA from €54.3m to €71.6m.

Management also pointed to a strong improvement in active customers, with an increase of 15% YoY to 1,281,267.

Breaking revenue down by region, Central and Eastern Europe and Central Asia (CEECA) continues to be Betsson’s shining light, with revenue up 18% to €110.2m.

Greece, Croatia and Lativa all reported all-time high revenue on the back of casino-driven gains, with the segment accounting for 44% of all group revenue.

Western Europe saw the largest revenue spike YoY, increasing 59.8% from €27.2m to €43.4m, as gains in Italy and Belgium were championed by the Stockholm-listed firm.

The Nordics, while representing 19% of group revenue, saw top-line figures dip 9.6% to €46.9m, which Betsson attributed to lower activity in casino as the main driver, despite a revenue increase compared to Q4 2023.

Elsewhere, Latam revenue fell 3.3%, with a low sports betting margin and negative currency effects in Argentina having an impact.

Casino continued to strengthen its position as the jewel in Betsson’s crown as the vertical’s share of group revenue increased from 69% to 73%, with revenue up 18.7% to €180.5m.

Sports betting revenue fell 2.5% YoY to €65.5m despite a 24.9% jump in stakes to €1.7bn for the operator. A weaker margin landing at 6.6%  compared to 8% in Q1 2023 and an eight-quarter rolling average of 7.4% also impacted the segment.

Locally regulated markets accounted for 43.6% of total group revenue, up from 36.3% in Q1 2023, while those markets also saw revenue jump 34% to €108.1m.

Pontus Lindwall, Betsson CEO, said Q1 had been a “positive start to the year” for the operator before looking ahead to a packed summer of sport.

He said: “After the positive start to the year, we now look forward to following the final rounds of the European football leagues and cups, before it is time for the best national football teams to measure their strengths in the UEFA Euro 2024 and Copa America in June and July.

“There is football fever out there and within the entire organisation a number of activities are already underway to ensure that Betsson will be able to deliver a powerful player offering for new and existing customers during these major championships.”