Kindred's revenue plummets in Q2 and H1; company hopes rebound after Dutch license award, 2022 World Cup

Kindred Group has announced the release of its half-year report and Q2 of 2022. The latter saw a total revenue of GBP 238.7 million ($285 million), down from GBP 363.7 million in the prior comparable period. Meanwhile, total revenue for H1 was at GBP 485.4 million ($582 million), down from $716.3 million in the first half of 2021.

Despite the negative results, CEO Henrik Tjärnström said that after a period of what he labeled "short-term headwinds," he looks to the future with confidence as he sees good progress with the group's key strategic priorities. This includes the reception of the company's Dutch license, a highly-expected development given the negative impact Kindred's exit from that market had on its operations.

The first half of the year saw gross winnings revenue decreasing by 34% to GBP 475.9 million ($912 million). Underlying EBITDA decreased by 77% to GBP 49.8 million ($59.8 million), while profit before tax for H1 amounted to GBP 14.6 million ($17.6 million), down from GBP 187.8 million ($226.1 million).

Reflecting on this performance, Tjärnström chose to focus on a series of positive developments. "Our Kindred Sportsbook Platform (KSP) remains firmly on track, and Relax Gaming continues to show strong numbers," he stated. "We are also nearing the end of a period of very tough COVID-19 comparatives, which have been giving a skewed view of our performance."

As for Q2, gross winnings revenues (B2C) decreased by 36% to GBP 233.5 ($279 million). Excluding the Netherlands, gross winnings revenue declined was down by a lower 13%. Underlying EBITDA decreased by 78% GBP to 25.3 million ($30 million), while profit before tax amounted to a low GBP 7 million ($8.4 million), down from GBP 102.5 million ($123.4 million).

Tjärnström said that the second quarter is a “seasonally low period of activity" as sports leagues end, with major football tournaments only taking place every other year. "With an exceptional period of sports in 2021, with Euros 2020 causing higher-than-normal activity during Q2 2021, we are now back to a normal sports calendar," he commented. 

The company received in June its license from the Dutch Gambling Authority, a landmark for the company, and has now begun taking bets. “We opened our doors to Dutch players on July 4 and have seen strong customer intake and activity in the period," the CEO stated. “I am very pleased with this initial performance and expect to see our Unibet brand gradually reclaim a leading position in the Netherlands." 

He also addressed the UK market and the way it was impacted by stricter affordability checks self-imposed by the industry. “These measures can be expected to continue over the coming quarters," the executive said. "Whilst impacted revenues in the short term, this ensures a more sustainable customer base."

Tjärnström also updated on the development of the company’s proprietary sportsbook, which “continues at pace and according to plan." “Once operational, our KSP will give us a unique and important flexibility to tailor our offering towards our customers across the world," he added.

"We have an exciting period ahead of us with the Dutch market up and running, the continued development of our proprietary sportsbook, and not least the 2022 World Cup taking place in November and December," the CEO predicted. "We also expect the headwinds experienced during past quarters to gradually ease off in the coming quarters. We have prepared and built our team and offering for the future, which we are now ready to fully embrace."