Kindred confident in platform rollout while growing 17% in North America

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Kindred interim CEO Nils Andén has expressed his confidence in the success of the rollout of the group’s proprietary platform in the US in boosting performance. 

The CEO spoke as the NASDAQ Stockholm group published its Q2 financial report, declaring revenues of $394.3m, up 29% on Q2 2022 comparatives of $305.6m. Total revenues for H12023 stood at $787.3m, up 26% on H1 2022’s results of $622.9m. Further improvements saw Q2 B2C gross winnings increase by 28% to $366.1m.

In North America, Kindred made $10.8m in GGR, marking an increase of 17% year-over-year, attributable to the group’s increasing focus on multi-product states as well as strong cost control. 

Whilst still recording an EBITDA loss of $6.6m for Q2, this marks a reduction of 31% YoY, with the average player value increasing during the second quarter. 

One of Kindred’s operational highlights in Q2 was the rollout of its proprietary tech platform in New Jersey, which Andén stated helped to boost performance in the state. 

“We strongly believe that the Kindred platform is the best in the business,” he said. “We are very keen to bring that to all the customers we have in all markets and brands. In Q2 we launched the platform in New Jersey and in just the beginning of Q3, we launched it in Pennsylvania. 

“We’ve seen some really strong significant improvements in retention and conversion numbers for our New Jersey business on the back of the platform migration. We have seen a daily average crosswind go up by almost two times and similarly, the conversion rates from registration to new depositing players have almost doubled. This is really bringing us great confidence in our platform.”

Marketing expenses, as mentioned, were lower than comparative periods in Q2, standing at $4.5m. However, the interim CEO noted that this would increase later in the year as the football season comes into the fold.

“If we look forward to the second half of the year, we do see that some of these losses will increase as the weighting of the partnerships and sponsorships we have in North America are focused on the second half of the year when the American Football season is active.”

However, despite the cutback on marketing spend, Kindred hinted that, should the rollout of the platform provide significant opportunities for growth and capturing market share, it could “put its foot down” on extra spending to pursue those opportunities. 

Asked about the mentality of the business in New Jersey and Pennsylvania now the company has re-platformed, Anden stated that “if we see really strong unit economics”, additional spending could ensue. 

“As we scale our investments, we’re not going from zero to 100, overnight, anywhere we operate, but we do it in a very sort of consistent fashion to ensure we have really good fundamental unit economics. 

“Irrespective of the market we’re in, if we see really good unit economics, we increase investments and it’s the same for North America as it is for Denmark or the Netherlands.”

Kindred strategic review updates

More holistically, Kindred has gone through a transformative period, in which Andén replaced Henrik Tjärnström as CEO, whilst a raft of other senior executives have also moved on from the company. 

Analysts were keen to know the outcome of the strategic review which was initiated earlier this year. While management could provide no concrete update on the review or when it will likely come to a close, it was revealed that the board is pleased with the progress made so far. 

Andén explained: “I am at the moment, just the interim CEO. That’s a fairly normal procedure Given that we are in the middle of the strategic review, we have said that we are not making any near-term changes, or large changes to the business.

“As part of the strategic review, we’re turning over every stone in the company. And, you know, once it’s concluded, we will communicate what that entails. But at the moment, there are no bigger near-term changes to our strategy.”