Sports betting solutions provider Kambi has put in place a cost-saving package designed to mitigate the financial impact of the Covid-19 pandemic, after reporting a strong performance in the opening quarter of 2020.
With a significantly reduced global sporting calendar for an extended period, the group says that its “strong balance sheet” will enable it to see out a period of reduced sporting action.
“While this remains the case, Kambi has decided to take various proactive measures to further solidify this platform and protect its staff, partners and investors for the longer-term,” the company stated.
The cost saving programme will result in savings across the whole business, including significantly reduced travel and marketing costs, a freeze on staff recruitment and a substantial reduction in data costs associated with fewer sporting events.
Kambi has also applied for the financial support packages announced by the Swedish and UK governments, both of which are designed to protect jobs. As of now, Kambi board members, the CEO and executive management have agreed to salary deferrals of 20 per cent, 15 per cent and 10 per cent respectively.
Operating expenditure in Q2 2020 is anticipated to be in the range of 10 to 20 per cent lower than in Q4 2019. The cost saving package will also result in associated savings in capitalised development costs of 20 to 30 per cent compared to Q4.
In Q1, Kambi’s revenue was strong and expected to be confirmed as in the range of €27.5m to €28m, with EBITDA of €6m to €7m. The cash balance at the end of the quarter was in the range of €45m to €47m.
Over the past three weeks, however, Covid-19’s impact has been such that sport-driven revenues are only in the range of 25 to 30 per cent of those achieved during Q4 2019.
“The timing of a return to normalised activity levels is of course uncertain at this stage, but we do note with interest recent reports that football leagues including the English Premier League and the German Bundesliga are preparing for a return to action in the coming months,” Kambi added.
