German online lottery provider Zeal Network said revenue grew by 35 per cent in Q1 to €36.1m, up from €26.7m in Q1 2023.
The company said its core lottery arm pushed the overall growth, with billings up by 22 per cent to €246.3m and revenue climbing by 28 per cent to €32m.
Zeal added that a change in its product mix and "further margin optimisations" allowed it to improve the gross margin in the lottery business to 13 per cent, up from 12.4 per cent a year ago.
Zeal’s online games business, which launched last summer, also developed in Q1, the group said. Revenue here grew 20 per cent from €1.8m in Q4 to €2.2m in Q1 2024.
New customer acquisition has also improved for Zeal, which onboarded more than twice as many new customers – 320,000 – as the 143,000 brought onto the company's platforms in the same period last year.
Marketing expenses in Q1 rose by 91 per cent to €13.4m, with Zeal making use of the “exceptionally good jackpot situation in January 2024 for efficient new customer growth.”
At €9.4m, EBITDA was “slightly higher” than Q1 2023’s €9.3m, Zeal said, with EBIT of €7.5m six per cent higher than in the first quarter of last year.
Zeal’s chief financial officer Sebastian Bielski said: “We made a very strong start to 2024 and were able to significantly accelerate our revenue growth, particularly in our core business of lottery brokerage.
“We are also particularly proud of the fact that we were able to achieve EBITDA slightly above the previous year's level in the past quarter despite almost doubling our marketing expenses and a negative one-off effect from a major win in our charity lottery Deutsche Traumhauslotterie amounting to €0.8m.
“This shows that our measures to acquire new customers are paying off very quickly and that we are generating income across the entire breadth of our customer base. With the announced squeeze-out at LOTTO24, we are also putting ZEAL in the best possible position for the future and are leveraging further efficiency potential."
