Zeal Network reports 54.15% rise in EBITDA in 2021
German lottery operator sees EBITDA more than double compared to 2020, despite new customer sign-ups dropping 41% year-on-year
Zeal Network has posted a 54.15% increase in EBITDA to €27.7m (£23.12m) for full-year 2021.
The German lottery operator significantly increased its EBITDA figure from full-year 2020’s result of €12.7m, while EBIT also increased from €5.4m to €19m in 2021.
The Hamburg-based company also posted stable revenue of €86.8m. Zeal stated that despite an unfavourable market due to unattractive jackpots, it had managed to keep business volume stable and build a foundation for 2022.
Net profit also rose for the operator as it posted €11.4m compared to €7.9m in 2020.
Zeal also said that billings increased slightly by 1% to €656.5m, despite the unfavourable market.
The company also registered 544,000 new customers, almost half as many as it achieved in 2020 (918,000).
Jonas Mattsson, CFO of Zeal Network, said: “In 2021, we have proven that we can be successful even in a difficult market environment.”
The operator also said that marketing expenses had decreased significantly to streamline efficiency.
Zeal spent €22.4m on marketing in 2021 with a comparable cost-per-lead. However, the firm has stated that once the jackpot environment becomes more palatable, it would further invest in its marketing efforts.
Zeal also streamlined costs in other areas, which saw personnel and other operating expenses fall by €18m to €60.2m in 2021.
In July 2021, Zeal offered LOTTO24 shareholders to buy all of the operation’s shares not directly held by Zeal for €380.97 per LOTTO24 share in cash
This offer was accepted for a total of 22,834 shares, and by 13 September LOTTO24 was delisted.
Zeal said it now holds more than 1.5 million LOTTO24 shares, equating to around 94.9% of LOTTO24’s share capital.
Looking ahead to 2022, Zeal said it hopes to maintain its position as a leading provider of online lotteries and to introduce a new line of products. Zeal expects billings of at least €750m from the German market, assuming an average jackpot development.
Zeal also expects adjusted EBITDA to be at least €30m with revenue expected to be at least €105m. It also said that it plans to spend €30m in marketing expenses for the financial year 2022.