Net revenue

Svenska Spel reports lower net sales in turbulent first quarter – Finance

Swedish lottery and gaming operator Svenska Spel reported net gaming revenue of SEK 1.93 billion (£156.6m/€185.5m) for the first quarter of 2022, as a only of its major business segments recorded revenue growth.

This is a year-on-year decline of 3.2%, which Svenska Spel attributes in part to the cancellation of sports games and limited casino opening hours in early 2022 due to the Covid-19 pandemic. 19.

In terms of business areas, Svenska Spel’s Tur offering – its lottery business – recorded revenue of SEK 1.13 billion for the first quarter. This is a decrease of 6.3% compared to Q1 2021.

Sports and online casino accounted for SEK 556 million of total net income, down 14.1%. Patrick Hofbauer, CEO of Svenska Spel, explained that this loss was due to a combination of the Covid-19 pandemic and responsible gambling measures.
“This is primarily due to the significant impact of the pandemic due to canceled sporting events at the start of the year, but also our enhanced gambling response measures which have been introduced so that customers do not gamble more than they can’t afford it and with special attention to our young customers,” he explained.

Revenue from Casino Cosmopol’s land-based business, as well as its Vegas brand of slots and its restaurant-casino chain rose 81.6% to SEK 240 million.

“The start of the year was again a difficult one for our land-based casinos and Vegas vending machines due to pandemic restrictions,” Hofbauer continued. “After the restrictions were put in place
lifted on February 9, our Casino Cosmopol extended its opening hours and gradually returned to a broader gaming offer.

Breaking down these net gaming revenues by sales channel, online sales accounted for almost half of the total at SEK 962 million, down 5.3% year-on-year.
Retail lottery agent sales brought in SEK 732 million of total net income, down 11.5%. Restaurant-casinos and slot machines generated net income of SEK 138 million, while casinos and grounds amounted to SEK 102 million.

Other net income was SEK 77 million, compared to SEK 38 million of other net costs in 2021. After gaming taxes of SEK 355 million and direct costs of gaming activities of SEK 248 million , total game net sales were SEK 1.40 billion, up 6.6%.

Operating expenses for the quarter were SEK 818 million, up 12.5%. Svenska Spel attributed this increase to sponsorship, IT investments and increased casino operations.

Breaking this down, personnel costs amounted to SEK 279 million, which is SEK 18 million more than in the first quarter of 2021. Other external expenses increased from SEK 374 million to SEK 452 million.
After depreciation and write-downs of intangible and tangible assets at SEK 87 million, total operating profit amounted to SEK 595 million, down only SEK 3 million compared to the first quarter of 2021.

“Despite the challenges of the first quarter, I confidently look forward to the rest of 2022,” Hofbauer said. “We continue to provide our customers with entertaining gaming experiences in a responsible way because we want gaming to be a joy for everyone.”