Mia Gardner | 07 May 2019
Last week, the Stockholm-listed operator reported that its revenues for the three months ended March 31, 2019 came to €86.3 million; a 12% increase over the same period of the previous year. However, organic growth in local currencies came to just 4% for the firm, while its earnings fell almost 25% to just €7.2 million.
Regardless, despite this worrying drop in earnings, investors in the company were overjoyed by the news of its revenue increase. They were also reportedly pleased by the results due to the fact that the company’s last financial report left an air of uncertainty in its wake. The news pushed shares in LeoVegas up by 22% by the close of trading on Thursday.
Q1 started out on a high note thanks to Sweden’s newly liberated online gaming market. LeoVegas was one of the first firms to be granted a new local license, and its brand Pixel.bet launched its Swedish-facing platform in February. GoGoCasino, the newest brand in LeoVegas’s library and the latest to be added to its multi-brand platform, launched in the country towards the end of March as well.
The downsides to Sweden’s regulated market, however, are many. Issues like massive marketing costs, advantages held by former gambling monopolies, and other issues have been discussed at length in other operators’ financial reports, but even so, LeoVegas CEO Gustaf Hagman is happy with his company’s performance.
Hagman has noted that while LeoVegas’ market revenue in Sweden dropped 16% in Q1, the firm’s depositing customer base grew 23% over the previous year, suggesting that the company has taken market shares from its competitors. The CEO says that Swedish revenue is also growing month by month; a trend that reportedly continued into April too.
According to Hagman, the UK is still a challenging market for his company, as consecutive revenue growth and “good profitability” at Rocket X was counteracted by a weaker performance of its Royal Panda brand. The latter suffered due to reduced advertising and what was termed “necessary regulatory adaptations”. In the meantime, the operator is expecting to be issued licenses for the German state of Schleswig-Holstein, and its Danish, Canadian and Finnish offerings all performed strongly in Q1.