Betsson has reported an over 100% increase in revenue from its Latin American operations in the fourth quarter of 2022, helping to drive overall growth for the operator.
The group’s LatAm operations achieved record highs in most parameters during Q4, and all countries in the region reported improvements year-over-year, as well as compared to the previous quarter with increases in deposits, turnover, and player activity in its sportsbook and casino verticals.
The World Cup was also highlighted as a contributor towards the strong quarter, as well as the advancements for Strive Gaming in North America.
Betsson also reported an 18% increase in full-year group revenue, with CEO Pontus Lindwall calling 2022 the “best year ever,” adding the group is optimistic about 2023.
Betsson LatAm operations drive growth
Publishing its Q4 financials, Betsson declared a group revenue of US$237.5m, a 40% increase YoY (Q4 2021: $169.5m), and an organic growth of 48%.
Per vertical, casino represented 66% of total group revenue at $157.3m, a 27% improvement YoY (2021: $123.9m), while sportsbook represented 32% of the group revenue at $76.1m, up by 76% YoY (2021: $43.3m) and sportsbook margin stood at 7.3% (2021: 6%). Other products came in at $4.1m, a 68.5% increase YoY (2021: $2.5m).
Active customers rose during the quarter by 23% to 1,424,794 (2021: 1,161,683).
Group EBITDA improved by 68% YoY to $55m (2021: $32.7m) with an EBITDA margin of 23.2% (2021: 19.3%). Operating income (EBIT) grew by 92% to $43m (2021: $22.4m) with an EBIT margin of 18.1% (2021: 13.2%).
Betsson’s Q4 net income came in at $35.2m or $0.28 per share (2021: $20.1m/$0.15 per share), operating cash flow stood at $81.3m (2021: $14.4m), while the group’s net debt was -$70.7m (2021: $2.7m).
Operations in Latin America helped to drive a rise in group revenue during the quarter, as the region represented 24% of the total group revenue with $56.3m, a 101.6% increase YoY (2021: $27.9m).
Within the region, Betsson noted that all countries reported revenue improvements YoY and compared to the previous quarter thanks to “strong underlying activity where active players, deposits and turnover in both casino and sportsbook were all-time high,” as well as the World Cup in November and December.
Elsewhere, the group saw 38% ($91.9m) of its Q4 revenue come from Central & Eastern Europe and Central Asia (CEECA), while the Nordics generated 24% ($57.1m), Western Europe produced 12% ($27.8m), and the Rest of the World yielded 2% ($4.31m).
Lindwall commented: “The fourth quarter was dominated by the largest sports event of the year, the Football World Cup. In sports terms, it was perhaps one of the best tournaments of all time, with both real surprises and favorites playing some incredibly exciting games in the knock-out stage.
“As expected, for Betsson the World Cup turned out to be the largest sports event ever and contributed to new records for all possible key performance indicators in the quarter, such as revenues (despite a significantly lower sportsbook margin than in the previous quarter), EBIT, sportsbook turnover, casino turnover, active customers and customer deposits.”
The CEO continued: “Geographically, once again growth was driven by the regions Latin America and CEECA.
“Above all, Latin America recorded new highs on most key parameters. Our strategic investments in the region continue at full speed – in Peru, the naming rights sponsorship for the highest football league, Liga 1 Betsson, was extended another four years, and in Chile, a new naming rights deal was agreed with the highest football league, which will be named Campeonato Betsson.
“Both leagues kicked off at the end of January, and it is gratifying to see the continued engagement in football together with clubs, fans, and customers.”
During the quarter, Betsson also opened a new Latin American center in Bogota, Colombia, as part of its plans for progressive growth in the region.
‘Best year ever’
For FY22, Betsson’s group revenue was $836.6m, an 18% increase YoY (2021: $707.9m), and an organic growth of 27%.
The group’s EBITDA for 2022 improved by 12% YoY to $185.6m (2021: $165.5m) with an EBITDA margin of 22.2% (2021: 23.4%). Operating income (EBIT) grew by 11% to $141.2m (2021: $126.6m), with an EBIT margin of 16.9% (2021: 17.9%).
Betsson’s FY22 net income was $123.5m or $0.94 per share (2021: $111.9m/0.84 per share) while operating cash flow was $192.4m (2021: $154.6m).
Lindwall noted: “We can look back at the best year ever for Betsson with strong growth and profitability, driven by disciplined capital allocation, geographical diversification, and investments in new markets, as well as continuous strengthening of the tech platform and product offering.”
Betsson also highlighted the growth of Strive Gaming, which it owns 40% of. It has signed contracts with six customers, three of which are live – Golden Nugget and Desert Diamond in Arizona, and Betsafe in Colorado – with the remaining three to go live in the first half of 2023.
Strive Gaming also has licensing underway for casino operations in Michigan, New Jersey, and Pennsylvania, and it recently appointed former DraftKings Vice President Jamie Shea as its new Chief Marketing Officer.
In 2023, Betsson is aiming for growth in existing markets, expansion into new markets, and the development of its B2B offering with a focus on the proprietary sportsbook.
The group noted that it is already off to a strong start in Q1 2023, as the average daily revenue up to and including Feb. 8 was 34% higher than the average daily revenue of Q1 2022. Its sportsbook margin has also been higher during this period than the average margin over time.
At the beginning of February, through its subsidiaries, Betsson was also granted its third license in Argentina after being awarded an online gaming license in the province of Cordoba.
The group is also seeking to obtain signed agreements with iGaming Ontario (iGO) in Q1, which will allow it to operate in the Ontario-regulated market in Canada. In September, the Alcohol and Gaming Commission of Ontario (AGCO) issued an operator registration to Betsson’s operational subsidiary GWN Limited, as well as a gaming-related supplier registration to Betsson Platform Solutions Limited.
Lindwall concluded: “I would also like to take the opportunity to thank our employees for all the hard work put in during the past year. Together we will continue to deliver the best customer experience in the gaming industry and create long-term value for our shareholders.
“Even if the macroeconomic and geopolitical situation in the world remains uncertain, we remain optimistic about 2023 thanks to our geographical diversification, focus on profitable growth, strong balance sheet, and our sustainable gaming solutions.”