Revenue rose 4.2% year-on-year to €440.1m (£375.5m/$470.7m). GGR topped €1.01bn, creeping up 1.0%, while bets jumped 19.5% to €8.7bn.
Guglielmo Angelozzi, chief executive officer of Lottomatica, said the quarter had been buoyed by an improved market performance.
“In the first quarter of 2024 we have continued our path of organic growth, also supported by solid market tailwinds, with revenues and EBITDA achieving double digit growth YoY at normalised payout,” said Angelozzi.
After the quarter’s end, Lottomatica completed its acquisition of SKS365 Malta Holdings. The deal was originally agreed in Q4 and had an enterprise value of €639m (£548m/$685m).
“We have successfully completed the acquisition of SKS365 in April 2024, therefore upgraded the guidance, and continue to execute on our strong pipeline of bolt-on M&A,” Angelozzi continued.
When the deal was first announced, Lottomatica said that SKS365 would help to strengthen its presence in Italy.
Online bets jump 35.5%
Turning to bets, a grand majority came from online at €5.05bn, an increase of 35.7% year-on-year. Bets from Lottomatica’s gaming segment totalled €2.85bn, ticking up 0.8%. Bets on sports, meanwhile, totalled at €822m – the lowest of the quarter, despite being up 9.7% yearly.
Market share for online GGR was 21.6% in the first quarter of the year. Online sports GGR took up 21.2% of market share, while online gaming market share stood at 21.8%.
Adjusted EBITDA dropped 4.0% to €149.2m. Most notably, it fell 40.0% for the sports segment, landing at €19.7m.
Lottomatica’s gaming franchise accounted for €195.3m in revenue. This was up 4.0% from Q1 2023. But the most significant hike came from Lottomatica’s online segment, where revenue was €150.3m, a rise of 21.1%. Sports segment revenue dropped 14.5% to €94.3m.
Other income totalled at €3.8m, bringing the total revenue and income to €433.9m.
Expenses up across the board
Expenses grew year-on-year across the board. Cost of services proved to be the highest of the quarter at €265.1m, 7.2% more than in Q1 2023. Personnel expenses were up 6.3% to €26.0m and finance expenses spiked 20.8% to €45.2m.
Depreciation, amortisation and impairments grew by €10m to €51.9m. The only form of income in this section of the report was finance income, which totalled €6.0m – a hefty increase from the €12,000 recorded in Q1 2023.
Lottomatica’s pre-tax profit declined 21.0% to €52.5m. Following income tax expense of €22.3m, net profit totalled €30.1m, a 31.1% fall from Q1 2023.
Lottomatica also outlined its guidance for FY24. Revenue is expected to lie between €2.02bn and €2.06bn, with adjusted EBITDA projected to be between €680m and €700m. Notably, this also takes eight months of contribution from SKS365 into consideration.
Original article: https://igamingbusiness.com/finance/lottomatica-q1-net-profit-slips-as-costs-rise/
