NetEnt releases interim report

The NetEnt online gambling group has posted an interim report covering performance in the first half of 2017, with CEO and president Per Eriksson highlighting continued solid growth, higher profitability and a strong cash flow.

The most important growth drivers were mobile games, along with the regulated markets in Great Britain and Italy.

“During June, mobile games contributed more than half of our revenues while Britain was our largest geographic market for the quarter,” Eriksson reported. “For the second half of 2017, we see conditions for continued solid growth.”

Second quarter 2017 highlights from the report include:

* Revenues for the second quarter increased by 15.5 percent to SEK 407 (352) million;
* Operating profit amounted to SEK 145 (122) million, an increase of 18.5 percent;
* Operating margin was 35.7 (34.8) percent;
* Profit after tax amounted to SEK 134 (113) million, an increase of 17.9 percent;
* Earnings per share amounted to SEK 0.56 (0.47) before and after dilution;
* 6 new customer agreements were signed and 8 new customers’ casinos were launched.

For the half-year to end June, highlights include:

* Revenues for the first six months increased by 15.4 percent to SEK 805 (697) million;
* Operating profit amounted to SEK 281 (251) million, an increase of 12.2 percent;
* Operating margin was 35.0 (35.9) percent;
* Profit after tax amounted to SEK 258 (235) million, an increase of 9.6 percent;
* Earnings per share amounted to SEK 1.07 (0.98) before and after dilution;
* 21 new customer agreements were signed and 14 new customers’ casinos were launched.

Important events in the second quarter:

* A supplier license was obtained in British Columbia, Canada;
* Games were launched on the regulated market in Serbia;
* Table games were introduced for customers in Spain;
* Cash distribution of SEK 540 million (2.25 kr/share) to shareholders;
* The number of gaming transactions on NetEnt systems was 10.1 billion during the quarter, corresponding to a y-o-y increase of 14.4 percent.

Eriksson said that whilst revenue growth in Sweden has been relatively slow, Great Britain and Italy continue to provide good results and great potential, whilst fast growth is being experienced in regulated markets such as Denmark, Belgium, Spain and New Jersey, and Spain continues to hold promise.

“The future outlook remains bright for the remainder of 2017,” said Eriksson. “We see conditions for continued solid growth supported by new games, increasing market shares in the UK, mobile growth, many new customers to launch and our expansion in North America.

“We continue to hire more employees and develop our platform. We strengthen the organisation to increase our output capacity, enter more regulated markets and integrate a large number of new customers. With this in mind, we foresee an ongoing need to invest during the rest of 2017. We do this to enable continued solid growth with increasing economies of scale for NetEnt going forward.”

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