LeoVegas Q2 revenues up 8% despite continued UK struggles
Organic growth ex. UK is 26%, with Stockholm-listed firm now taking share in Sweden
LeoVegas has reported 8%cc organic growth in Q2 with the Stockholm-listed operator gaining market share in Sweden but still struggling in the UK.
Quarterly revenues hit €94.4m, while EBITDA was flat on the same period last year at €15.1m, with the operator offsetting increasing gaming taxes with a focus on operational efficiencies.
The firm noted the UK “continued to be challenging” with organic growth ex. UK at 26%.
CEO Gustaf Hagman told EGR there were no “easy fixes” for the market, but said the firm would continue to focus on product.
Regulus Partners estimated the UK was around 16% of revenue (c. €15m) and was therefore down around 38% due to a combination of high-roller disruption and likely marketing pullback.
“While this issue has affected many companies, Leo’s high average revenue per player (ex. Rocket X) would suggest a disproportionate impact,” Regulus said.
The story was more positive in Sweden, where Hagman noted: “We have found a new base to grow from following regulation of the market, and our revenue developed in a positive direction month-on-month during the quarter.”
The group said LeoVegas was the single-largest casino brand in Sweden and customers “appreciated” the smaller GoGoCasino and Pixel.bet brands.
Elsewehre, Hagman said Leo now a more balanced geographic revenue mix than a year ago.
“This means that we are not as sensitive to challenges that may arise in a specific market, which in turn means that we have lower business risk in the Group,” Hagman said.
Regulus noted that Rest of World revenues grew 56% to €12m, with Leo “continuing to prove its operational capabilities as a disruptor in .com markets”.
LeoVegas shares were down 6% at time of writing.
During the quarter, deputy CEO Louise Nylen also left the business after six years for family reasons, with Hagman hailing an excellent six years with the business.
Hagman also reiterated the firm’s financial targets to achieve €600m in revenue and EBITDA of €100 m by 2021.
“We want to clarify that the targets are based primarily on organic growth, but also include revenue from potential future acquisitions,” Hagman said.