Nasdaq Stockholm-listed online gambling operator Kindred Group has reported a significant drop in underlying EBITDA in the first half of 2019, to a mark of £61.1m from £89.2m in the corresponding period last year.
The 32 per cent decrease arrives even as gross winnings for the period rose to £450.6m (£426.8m), while profits before tax slumped to £32.4m (£62.5m) for the period. Profit after tax was £27.6m (£55.4m).
Kindred Group CEO Henrik Tjärnström said: “Despite very tough 2018 comparatives, which included the start of the World Cup, revenues grew four per cent in constant currency year on year with particularly strong growth in locally licensed markets.
“Of the Group’s gross winnings revenue, 59 per cent came from locally licensed markets which represented 41 per cent growth compared to the same quarter last year (growth of 19 per cent excluding Sweden). This focus on growth in locally licensed markets is very much part of our strategy and, as expected, has resulted in margin pressure from higher betting duties. During the second quarter of 2019, gross winnings revenue from mobile grew by 11 per cent compared to the second quarter of last year and amounted to 77 per cent of our total Gross winnings revenue.”
“As we have highlighted for a long time and as we saw in the first quarter of 2019, the new licensing regulation in Sweden has resulted in significant short-term margin pressure driven by higher betting duties but also higher marketing as we are investing for the longer term. In the Swedish market, we saw a significant improvement quarter on quarter, but EBITDA contribution was still down £9.2m when compared to the second quarter last year.”
