Betsson's 24% sportsbook revenue increase drives Q3 growth

Betsson AB has published an interim report for the months of July-September, 2021. The Swedish company is calling Q3 “another strong quarter,” mainly driven by its sportsbook operations.

Group revenue was $201.9 million, an increase of 3% over the same period last year. Q3 saw an organic increase of 8%, while casino revenue decreased by 2%. However, sportsbook revenue saw a significant increase of 24%, and the sportsbook margin was 7.9%.

Net income was $33.4 million, and operating cash flow was $49,3 million. Moreover, the company revealed active customers increased by 7% to 986,429.

While the company was able to post several records during the previous quarter, it managed to increase revenue by just over 3% during Q3, compared to the same period last year. The company says this was expected as Q3 2020 proved to be a “very strong quarter.” At that time, the strong increase in revenue was driven by a surge in demand for digital entertainment.

Now, the further increase in revenue is explained “by the success with our sportsbook” in combination with good results in the ending rounds of the EURO 2020 and CONMEBOL Copa América, and the return of the domestic football leagues from mid-August, says CEO Pontus Lindwall. This has resulted in sportsbook revenue increasing by about 24% year-on-year.

Revenue figures have also benefited from successes in new markets such as LatAm, Croatia and Greece. However, Betsson finds unfortunate the case of the Dutch market, in which the Gaming Authority published a new policy at the end of September which “entails a deviation from the previously communicated guidelines during the cooling off period.”

“The new policy implies that operators who are waiting out the cooling-off period are forced to cease operations completely, pending an obtained license,” explained Lindwall. “Based on the new policy, Betsson decided to temporarily stop accepting Dutch customers on international websites in order to create good conditions for the upcoming licensing process.”

The Swedish operator further said it “continues to have strong faith in the Dutch market” despite the regulator’s decision, and an ambition to be able to conduct business in the future “in accordance with the new regulations.” 

The efforts to prepare the license applications and preparations for certifying the technical platform are ongoing, with an expected submission date of “no later than at the end of the first quarter 2022.” The outcome of the application process is expected after the summer of 2022.

Betsson further issued an update on its plans for the US market. The investments to be able to launch the company’s B2C offerings in Colorado during the first quarter of 2022 “continue according to plan.”

“This quarter has been an intense period to secure everything from meeting the authorities' reporting requirements to adapting the platform and technology so that the US-adapted sportsbook can enter a testing and certification process,” stated the company’s CEO.

The sportsbook has also been integrated into the Strive platform, which has now been certified in the state of Colorado. Betsson expects this to benefit the company during the testing and certification processes that are initiated now.

Further Q3 highlights found Betsson acquiring Peruvian sportsbook and casino company Inkabet’s B2C business, a move expected to further strengthen and expand the operator’s presence and position in the Latin America region. It builds on previous acquisitions of JDP Tech Ltd, Suaposta, and Colbet.

The period also found Betsson investing in the Canadian startup company Slapshot Media Inc, by acquiring 28% of its shares. This enables Betsson “to create a strong position in the Canadian market ahead of the upcoming regulation in Ontario,” according to Lindwall.

“Strengthening our business through acquisitions is an important component of our strategy and it has been a successful way to create growth but also to build competence in the organization.”