Record Profit for Betsson Thanks to Sportsbook and LatAm Region Growth
The second quarter of 2021 was very successful for the Swedish online gambling company Betsson, reaching an impressive profit of 337.9 million SEK, a record for the company to date. Much of this success is attributed to the growing interest in the sportsbook in Latin America.
According to the company chief executive officer Pontus Lindvall, the main reason for the record revenue was an increase in the operating margin for sports betting. A huge share of success in the second quarter was achieved due to the efficiency of bookmakers during football matches.
The total amount of money earned by Betsson within this period was 1.75 billion SEK.
Bulk of profit generated by the casino
Despite a 5% decrease in profitability over the previous year, casino generated the bulk of this revenue, namely SEK 1.22 billion. Bookmaker saw SEK 510.1 million earnings and a 125% increase compared with the same period in 2000 when most sporting events were rescheduled.
When calculating revenue by region, the leader is Nordics (550.4 million SEK, showing an increase of 13.5%). The second place remains with Asia and the Center and East of Europe (501.9 million SEK, representing an increase of 38.0% year-on-year).
The only region that showed a drop in profits was Western Europe (by 36.6% to 402.9 million SEK).
In the rest of the world, there is a rapid growth trend, with the total profit rising 121.4% to SEK 296.5 million, which is driven by the provider’s expansion in the Latin American market. In the rest of the world, sportsbook generated more revenue than online casino, which includes live casino games.
Viral campaign that gained a lot of traction
Thanks to a clever marketing campaign that went viral with a sponsorship of the "worst" soccer team in the world, Betsson has become very popular in Brazil and Peru. A sponsorship of CONMEBOL Copa América also played a huge role in attracting people.
In 2021, the provider paid out SEK 578.6 million (SEK 157.8 million for licenses, SEK 114.3 million in gambling duties, SEK 116.8 million as commissions for partners, and SEK 190.4 million in other expenses).
The gross profit increased by SEK 1.17 billion, up 22.4% over the previous year.
Betsson's expenses include:
- 9 million SEK for marketing
- 6 million SEK in manpower costs
- 9 million SEK in other outside expenditures
The company's operating profit for this year has exceeded the profit for the second quarter of 2020 by 76.1% and totaled 383.4 million SEK.
The list of expenses includes:
- SEK 88.9 million in depreciation expenses
- SEK 65.7 million in development costs
- SEK 31.8 million in tax payments
- SEK 13.8 million in loss on investment
Based on all the costs, Betsson's net profit over this period was unprecedented 337.9 million SEK, up 75.1% year-on-year.
The first half of the year brought a 13% increase in the profit (3,344 SEK).
With a revenue cost of about 1.14 billion, Betsson recorded a gross profit of 2.21 billion, which is 15.9% more than in 2020.
After taking into account all the operating expenses (SEK 1.55 billion), Betsson's net income was SEK 577.9 million. This figure exceeds the financial data of the previous year by 37.3%.
It is known that the operator wants to launch its Betsafe brand in the US, starting in Colorado. These plans had to be pushed back, as the company acquired 35% of the Strive shares and is going to use this platform, which requires undergoing certification. The launch is scheduled for the first quarter of 2022.
Also, a deal was made with the media brand ProSieben Sat.1 to ensure the successful access of the subsidiary brand ProSieben to the German market.