Enlabs Q4 revenue jumps 82% as Global Gaming integration completes
CEO George Ustinov hails “fully aligned organisation” and reveals dual strategic focus on Nordics and Baltics
Enlabs has reported an 82% year-on-year rise in Q4 2020 revenue to €20.3m (£17.5m).
Company EBITDA rose to €3.9m during the quarter, although the group’s EBITDA margin decreased slightly to 19.3% in Q4. Enlabs net profit decreased by 12% to €2.2m, with net profit margin dropping to 10.8% in the quarter.
The Latvia-based operator reported an 88% increase in total active customers during Q4, with a 99% increase in the total deposits received over the same period. Group marketing costs accounted for 13% of business revenue, a lower figure due to the impact of the pandemic.
Organic growth in the business during the quarter amounted to 20%, with 70% of revenue coming from regulated markets. During Q4, Enlabs completed its SEK150m acquisition and integration of Malta-based operator Global Gaming.
“We continued to pick up the pace following a successful acquisition of Global Gaming in Q3 and delivered yet another record quarter,” Enlabs CEO George Ustinov explained. “All our markets have demonstrated quarter-to-quarter growth in activity and revenue.
“Business developments wise most of our energy during the quarter was devoted to the integration of the Global Gaming team into the Enlabs structure,” Ustinov added.
Discussing the integration process, Ustinov revealed an 8% reduction in employee headcount due to the elimination of duplicated roles between the two businesses.
“The outcome of the integration process is a leaner, more agile and fully aligned organisation with a common business roadmap. Now we can proudly say that we are a single company,” he added.
Enlabs also chose to voluntarily surrender its Swedish licence pending a full return to the Swedish market in 2021. The firm is currently the subject of a €250m takeover bid by UK-based operator Entain.
At a full-year 2020 level, Enlabs revenue rose by 27% to €50.5m with slight declines in EBITDA and EBITDA margin. However, company net profits during 2020 rose by 62% during the year to €15.1m.
The Enlabs CEO revealed the firm’s primary focus will be on two operational areas, the Baltics and the Nordics, with 2021 launches planned in Sweden, Ukraine and Belarus.
Enlabs is currently certifying its products in Sweden pending a reapplication for a licence. In respect of Ukraine, the firm revealed it would not apply for a licence until all regulatory issues, including taxation of operators, becomes clear.
It is understood Enlabs estimates the value of the Ukrainian igaming market at €500m, with the operator planning to use the Ninja Casino brand as its main brand. Enlabs also revealed preliminary estimates that the Belarusian market could be worth as much as €50m when launched.
However, Ustinov confirmed that Enlabs closed a proposed expansion project in the Latam region in December due to a combination of a busy operational pipeline and the impact of the coronavirus pandemic.
Reflecting on the group’s financial results, Redeye analyst Jonas Amnesten hailed them as a “home run” for the business, citing the potential for growth in the firm’s main operational areas.
“The revenue was in line with preliminary numbers, but we note that one-offs were significantly higher than we expected,” Amnesten said.
“It is hard to see the marketing costs staying at this low level as Enlabs will start to compete on the competitive Finnish market and start up in two more markets with Ukraine and Belarus,” he added.