Operating revenue for the 12 months to 31 January 2024 reached €2.21 billion, surpassing the previous year by 23.1%. Evolution published detailed figures on its full-year performance earlier today (30 January).
Growth was apparent in the group’s two core segments: live and random number generator (RNG), with the former still its primary source of revenue by some margin. Overall spending was higher year-on-year, but increased revenue meant a positive result on the bottom line.
“During the past year Evolution has strengthened its position as the world’s leading provider and innovator of online casino games,” CEO Martin Carlesund said.” We continue to innovate and develop our world-leading product portfolio. The key to future success is to continue to give players an exciting, entertaining and flawless playing experience.”
Evolution posts growth against challenging backdrop
However, it has not all been plane sailing for the group in 2024. In his comment, Carlesund notes several challenges Evolutions faced during the past 12 months.
Among these were sabotage activities towards its studio in Georgia, which began in July. The group also faced cyber-attacks in the Asia region and higher tax rates in certain markets.
On top of this, Evolution ended 2024 with confirmation that it will face a licence review in Great Britain. Announced by the Gambling Commission in December, the regulator found Evolution’s games are being provided to unlicensed operators active in Britain. The group is cooperating fully with the investigation.
Carlesund did not directly reference this in his post-results comments. However, he did note the challenges of a “constantly evolving” regulatory landscape in the gambling industry. He said Evolution is implementing measures to prepare for new developments.
“An increasing number of countries introduce a national regulation for online casino,” he said. “We view this development positively and consider it a long-term driver of growth for the industry as it over time attracts new end-users and clarifies how B2C operators can address the market.
“As a B2B provider of games we hold licenses in several markets and need to adapt as regulation evolves. We have implemented further technical measures to ring-fence the regulated markets and to ensure that our games are available only through the locally licensed B2C operators in markets where local licences are available.”
Breaking down revenue by market, it experienced European growth of 9% year-over-year in Q4, which, according to a Regulus Partners’ note, suggests that overall market share is being lost.
No stopping live casino growth
In terms of revenue, Evolution drew over 80% of all revenue from its live casino division.
Revenue from this segment reached £1.78 billion, an increase of 16.6% on the previous year. This was helped by an increase in in its table games offering to over 1,700. This was over 100 more than in 2023. The supplier expected this number to be higher, but its Georgia studio has been operating at a reduced capacity due to ongoing staff strikes.
In October the company reported its Georgia studio was operating at 60% capacity, with around 550 employees involved in the union action.
As for the RNG business, which comprises slot businesses NetEnt, Red Tiger, Big Time Gaming and NoLimit City, revenue edged up 4.4% to €287.4 million. Evolution maintains that RNG is the largest vertical within the overall online casino market but it plays second fiddle to Evolution’s live casino results in terms of generating revenue for the business.
Evolution’s RNG arm has struggled over the past couple of years, but a turnaround effort was initiated in 2024, increasing its game releases and developing new features to improve the gameplay experience.
In its note Regulus Partners said the company’s RNG performance is “shaped by a painfully slow ‘turnaround’ which does not appear to be doing much more than stopping the rot, despite the promise of a number of ‘much anticipated’, ‘amazing’, and ‘spectacular’ game releases (revenue performance speaks a lot more than adjectives).”
The company also noted €151.1 million in other operating revenue attributed to earn-out liability in relation to M&A activity. This includes its acquisitions of Livespins and Arcadia Gaming Solutions, as well as earlier purchases of Big Time Gaming and Nolimit City.
On M&A, Evolution remains on track to complete its acquisition of Galaxy Gaming by mid-2025.
Evolution sees net profit reach €1.24 billion
Total operating expenses were 21.2% higher at €794.6 million on the back increased personnel costs, linked with the launch of new tables and studios.
This meant an operating profit of €1.42 billion, up 24.2% year-on-year. After financial items, pre-tax profit was €1.44 billion, an increase of 25.2%.
Evolution paid €194.9 million in tax, resulting in a bottom-line net profit of €1.24 billion, up 16.2%. On top of this, EBITDA climbed 23.2% to €1.56 billion.
What happened in Q4?
Evolution also made reference to the final quarter of the year in its full-year results. For Q4, revenue increased 31.5% to €625.3 million. Of this, €459.4 million came from live casino and €74.4 million RNG.
Operating profit climbed 38.0% and pre-tax profit 40.4% to €425.3 million. Tax amounted to €48.2 million, with net profit for Q4 at €377.1 million, a rise of 32.2%.
EBITDA for the fourth quarter jumped 35.0% year-on-year to €455.0 million.
“With great determination, with hard work and professionalism our employees have brought Evolution to an excellent position for future growth,” Carlesund said. “We will relentlessly continue to strive to make Evolution a bit better every day also during 2025.”
Original article: https://igamingbusiness.com/finance/full-year-results/revenue-evolution-2024/
