Betsson: US sportsbook Q1 launch ‘important milestone’ in global strategy

For Q1 2022, Betsson has declared an 8% increase in revenue YoY thanks to continued good momentum in the sportsbook and through geographic diversification.
Image: Betsson AB

Betsson has published its financial results for the first quarter of 2022, declaring an 8% increase in revenue year-over-year thanks to continued good momentum in the sportsbook and through geographic diversification.

Commenting on the results, CEO Pontus Lindwall stated that launching the Betsson sportsbook in the US during Q1 was an “important milestone” in the firm’s global strategy, whilst also noting the company’s movements in Latin America are developing “very satisfactorily”.

For Q1, Betsson has reported a group revenue was $178.8m (Q1 2021: $165.4m), an 8% increase YoY. Although casino revenue decreased by 5%, sportsbook revenue improved by 45% and the sportsbook margin was 8.3% (Q1 2021: 7.2%).

The group’s EBITDA stood at $35.1m at the end of the quarter, a decrease of 7% YoY (Q1 2021: $37.6m). EBITDA margin was 19.6% (Q1 2021: 22.7%). Operating income (EBIT) was $24.8m, a decline of 13% YoY (Q1 2021: $28.6m), while the EBIT margin was 13.9% (Q1 2021: 17.3%).

Betsson’s net income for Q1 came in at $21.9m (Q1 2021: $24.9m), its operating cash flow was $28.2m (Q1 2021: $33.9m), while its active customers increased by 33% to 1,256,449 (Q1 2021: 948,109).

Reflecting on the results, Lindwall said: “Thanks to goal-oriented work from our employees, we have been able to take advantage of the growth opportunities identified, which has resulted in increased revenue and healthy profitability.

He continued: “Once again, new records were set for sportsbook revenue and in several individual markets. It has been said many times before, geographic diversification makes Betsson’s business less sensitive to disruptions in individual markets.”

Across the Americas, Lindwall highlighted the launch of Betsson’s sportsbook in the US as an “important milestone” for the group’s continued global expansion, kicking off with its Betsafe offering in Colorado.

“The US investment is primarily focused on presenting the US adapted sportsbook to other operators within the framework of the B2B offering,” the CEO noted.

“More specifically, we are initially using the Business to Consumer (B2C) offering in Colorado as a showcase for the sportsbook. Many months of hard work from the product and technology teams were required to create a competitive sports product for the American market.”

Betsson’s operations in Canada were also one of the main driving factors behind its Rest of the World revenue during Q1 of $3.8m, a YoY increase of 19% (Q1 2021: $3.2m).

In Latin America, Betsson recorded an all-time high in revenue and new deposits during the first quarter, as revenue for the region hit $38.6m, a 174% improvement YoY (Q1 2021: $14m).

Most countries in the region reported growth both compared to the previous quarter 

and the corresponding period last year. Levels of activity remained high, especially within the sportsbook segment, as the quarter benefitted from high-profile events such as World Cup qualifying games in football.

In Colombia, the company also rebranded the Colbet brand to Betsson to take advantage of brand recognition in the region and drive further growth.

Lindwall added: “Starting this quarter, developments in Latin America will be reported as a separate region in our financial reports. The region is developing very satisfactorily. Market presence has also been strengthened in Latin America through the launch of our offering in both the City and Province of Buenos Aires, Argentina.

“To support the region’s growth, Betsson has built up a regional hub with central functions to serve local markets based on their respective conditions. The assessment is that these markets are still in their early stages in many respects and that growth opportunities for the coming years continue to be positive.”

Betsson also reflected on Russia’s invasion of Ukraine, alongside Belarus’ support for the conflict. As a result, the group has withdrawn its enterprise in Belarus and has looked into possibly evacuating its Ukrainian staff to Malta and Budapest or to less dangerous areas of the country.

Looking ahead, Lindwall stated that Betsson’s ambition is to bolster its presence across the Americas by going live with its products in Ontario, Canada this summer, as well as launching in Mexico.

The CEO concluded: “Our ambition is to further strengthen our presence in North America by operating under a new license in the Ontario region in Canada starting this summer. We also aim to launch in Mexico together with our local partner Big Bola Casino in 2022.

“Applications to operate in the Netherlands under the new license model were submitted during the quarter in line with the Group’s plan. All in all, the year has been off to a good start as there are many important activities that we look forward to during the remainder of 2022.”