Earnings before interest, taxes, depreciation, and amortization (EBITDA) was €15.1m, compared to €15m of Q2 2018, corresponding to an EBITDA margin of 16% which was 17.2% during the same period of the previous year.

“We reiterate our ambitious financial targets to achieve €600m in revenue and EBITDA of €100m by 2021. We want to clarify that the targets are based primarily on organic growth, but also include revenue from potential future acquisitions,” said Gustaf Hagman, CEO of LeoVegas group.

The number of depositing customers increased by 8%, from 309,961 to 334,961 and the number of returning depositing custmers also grew by 12%, from 175,500 to 196,203, compared to Q2 2018. Earnings per share were €0.07 before and after dilution, with no change reported.

‘Balanced’ revenue mix

“Compared to a year ago, LeoVegas has a more balanced geographic revenue mix. This means that we are not as sensitive to challenges that may arise in a specific market, which in turn means that we have lower business risk in the Group,” said Mr Hagman. 

“This work is helping to create necessary economies of scale and is countering the effect of that we are paying more gambling taxes. As previously communicated, our marketing investments also decreased compared with the first quarter of the year,” Mr Hagman added. “A contributing factor to this is more restrained marketing in Sweden during the quarter. In addition, the postponement of a few campaigns from the second to the third quarter has affected costs and contributed to operating profit, which will have a reverse effect during the third quarter.”

Furthermore, LeoVegas obtained a gaming licence in Spain and two weeks after the company launched its business in Spain, according to the press release sent to BM.

“This shows the strength and speed of LeoVegas and further demonstrates that our experience from regulated markets benefits us. Spain is a step in our continued expansion, and we have also recently carried out launches in other Spanish-speaking countries, such as Chile and Peru, as well as in Brazil,” continued Mr Hagman.

Moreover, Sweden has now been a regulated market for more than six months, and the development is beginning to indicate what kind of market the group will have over the long term. Leovegas also launched GoGoCasino and Pixel.bet.

“The investments made in 2018 and efficiency improvement work carried out thus far in 2019 are beginning to generate returns in the form of greater scalability of operations,” concluded Mr Hagman. 

The post LeoVegas sees organic revenue growing 8% in Q2 first appeared on The Malta Business Weekly.

The Spanish online gambling market is making iGaming stakeholders excited, as figures spur optimism. Spanish watchdog Dirección General de Ordenación del Juego reported revenues jumping by 21% to €193.2m in Q1 2019, as compared to the same quarter a year earlier. Behind sports betting, the online casino vertical was the second strongest; generating €67.1m. Big iGaming operators are heading to the market.

SkillOnNet, which operates PlayOJO, has been one of the most recent companies to have obtained a licence in Spain. Additionally, giants such as LeoVegas — seeing further expansion in Malta — and GiG, both having a firm presence in Malta, have also bagged their Spanish licenses lately.

“With such prestigious brands getting in on the action I think the Spanish online gambling market will continue to thrive over the coming months and years,” Bojoko CBO Joonas Karhu tells BM.

The Bojoko chief believes that the Spanish market will affect Malta positively, especially from the perspective of a licencing jurisdiction. “The Malta Gaming Authority (MGA) is one of the most established and trusted regulators in the world, and online gambling operators and suppliers wishing to enter markets such as Spain will still seek their approval,” Mr Karhu says.

He argues that being “dually licenced”, which essentially means that recognised by the MGA and by the regulator of the country a business is planning to enter, is a strong signal for players and other potential partners that an iGaming company operates to the highest possible standards.

“As markets such as Spain continue to regulate and show signs of growth, I think new operators and suppliers will enter the fray and will look to the MGA for licensing in addition to obtaining permits from the regulators in the markets where they launch,” Mr Karhu says.

Swedish reregulation ups the ante

However, another nation is believed to claim its stake at the European competition, holding strong cards in hand, as the recent reregulation of the Swedish market makes it an ever more attractive destination for iGaming firms.

“Bojoko supports the licensing and regulation of gambling in all markets around the world as it is the best way of ensuring that operators and suppliers are doing the right thing and that, ultimately, players are properly protected,” Mr Karhu says. “Online gambling is a hugely popular activity in Sweden and since the market reregulated at the start of the year we have seen all the major operators from the United Kingdom and beyond obtain the necessary licences to launch their brands in the country,” he adds.

Sweden is often seen as one of the most stringent markets when it comes to how operators can market their brands to players, which has caused some difficulties to companies, but generally, Mr Karhu believes that operators have adapted well and the market is growing nicely.

Mr Karhu further adds that the Swedish rerelugation will rather add to the importance of Malta. “I think this will have a positive impact on the Maltese online gambling industry. Malta is recognised as a leader and an authority in global online gambling and as markets continue to regulate and reregulate, the MGA will still to play a central role in the sector,” the business chief says.

In terms of the online gambling businesses based in Malta, Mr Karhu underscores that as most of these companies are multinational operators and suppliers he does not see them relocating to Sweden any time soon. Malta is considered as the world’s iGaming village and is expected to keep attracting companies and talent to its shores.

Expanding markets in EU, US

Additional European markets are expected to regulate the online gambling industry, which is seen to further establish the sector as a reputable, trusted and highly professional one. “We can clearly see the benefit of licensing and regulation in established markets such as the United Kingdom and Malta. Indeed, regulators such as the Gambling Commission and the MGA will continue to lead efforts to better safeguard players,” Mr Karhu says.

“I also expect Malta and the MGA to play a part in helping craft rules and regulations in new markets, as well as playing a central role in general conversations about how the iGaming sector can continue to move forward while properly protecting consumers,” he adds.

Overseas, the United States is also putting on the gloves, as a handful of states have already opened up, while another handful of states is working on regulating the market and would be opening up soon. “The United States is one of the most interesting online gambling markets in the world as more and more states license and regulate the activity. But it is very much a new industry and there is a lot to be learned from Malta and the MGA,” Mr Karhu maintains. He adds that he expects the MGA to “play a role in helping lawmakers craft rules and requirements, as well as to assist European operators looking to launch in the USA for the very first time.”

Although the opening up US market is foreseen to grow bigger than the European in the upcoming years, Mr Karhu does not believe the two giants would become competitors. “I do not really see it as one competing with the other. The United States is a new market that a lot of European operators and suppliers are keen to enter because of the huge potential on the table. The likes of Betfair, William Hill and PokerStars are already live, for example,” the Bojoko chief elaborates.

“I think European operators and suppliers — as well as regulators such as the MGA — can play a central role in how the US market evolves and expands simply because of the wealth of experience they have when it comes to working successfully in a highly-regulated industry,” he adds.

Only time will tell how European iGaming brands will resonate with players in the United States and whether any of the big US brands will decide to launch for players in Europe. “All things considered, I think the opening of the US market is great for Europe and great for the wider industry,” Mr Karhu concludes.

The post Spanish, Swedish markets may solidify Malta’s iGaming position first appeared on The Malta Business Weekly.

A warning and a penalty were sanctioned to the company for displaying a U17 game between Georgia and Slovakia on 28 January on its Swedish site. The authority says that the event was event incorrectly offered online and no bets were taken from end users based in Sweden.

Nevertheless, GiG intends to appeal the sanction, as the company says it does not agree with SGA’s assessment and conclusion as the presentation of an event cannot be considered the same as accepting bets on U18 games for the purposes of both determining the infringement and the quantum, as the press release says.

In addition, GiG says it has taken the necessary measures to ensure that all games presented on the sites are in line with SGA’s requirements and interpretation in order to end users in Sweden.

Sweden implemented gambling regulation from 1 January 2019, a development which GiG welcomes as the regulation promotes fair and safe play and offers better protection for the end users. GiG has also prioritised investments in building systems to adhere to the requirements of the Swedish gambling laws.

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“Referring to Chapter 18, section 12, second paragraph and Chapter 19, section 10 of the new Gambling act, Spelinspektionen has resolved on a warning and imposed a penalty fee of SEK 3m,” the company said in a press release.

The report by Spelinspektionen says that the infringement took place when Spelpaus was newly established as a service and the obligation to apply the function was new to all licensees and that the infringement ceased after a relatively short period of time, the company says.

“Aspire Global shares Spelinspektionen’s ambition to promote healthy gaming behaviour and regrets the turn of events,” the press release underscores.

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The MoU aims to facilitate ongoing communications between the two bodies, as well as to support the effective sharing of information. The two watchdogs also agreed to provide operational assistance to each other continuously, related to their respective procedures and regulatory policies.

“Many of the companies that have received a Swedish license also have technical equipment and a license in Malta. By opening the communication channels between the authorities, we become stronger in our supervisory activities. This is the beginning of broad and long-term cooperation, and our plan is to initiate corresponding collaborations with more gambling authorities in Europe,” says Camilla Rosenberg, Director General of the Swedish Gambling Authority.

“The MGA is always actively seeking to foster relationships with fellow authorities and other international regulatory bodies as we firmly believe that such relationships are key to reaching our objectives, especially in the area of remote gaming which is fundamentally cross-border in nature,” says Heathcliff Farrugia, Chief Executive Officer of MGA.

“This MoU, signed with the Swedish Gambling Authority, is an important step towards achieving both our respective regulatory goals in vital areas of mutual interest, especially since the MGA and the Swedish Gambling Authority share a significant number of operators licensed by both regulators. We are eager to start this mutually beneficial journey with our Swedish counterpart,” the MGA chief adds.

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“With this licence, we gain the opportunity to offer our product and passion for esports betting to the Swedish market. Moreover, we have added a truly exciting casino experience that we know customers will appreciate. This springboard in Sweden will also position us for continued expansion internationally,” says Eirik Kristiansen, CEO of Pixel digital Ltd.

“During a year when we focus on strong growth but also cost efficiency, it is inspiring to see that pixel.bet are developing well and that we as a Group can benefit from our economies of scale with the sharing of resources and knowledge between our companies,” adds Gustaf Hagman, CEO of LeoVegas Group.

Pixel.bet is an aspiring brand in esports betting, also offering casino and live casino. While Sweden and the Nordics are considered to be the primary markets in focus, LeoVegas maintains a clear potential to grow further internationally.

LeoVegas’ technology development is conducted in Sweden, while operations are based in Malta. LeoVegas offers casino, live casino and sports betting, and operates two global and scalable brands – LeoVegas and Royal Panda – as well as a number of local brands in the UK. The company’s shares are listed on Nasdaq Stockholm.

The post LeoVegas launches new brand ‘Pixel digital’ in Sweden first appeared on The Malta Business Weekly.

Swish is currently considered to be Sweden’s most popular and highly-used payment service, counting approximately 6.7 million users.

LeoVegas expects that the reregulation of the Swedish gambling market, which came into effect 1 January 2019, will allow the group to work more closely with banks and popular local payment services such as Swish, which is currently considered to be Sweden’s most popular and highly-used payment service, counting approximately 6.7 million users. This new payment service both strengthens the offering and will contribute to further cost efficiency for LeoVegas, the group claims

“Today Swish has 6.7 million users and 180,000 connected businesses. We are super pleased with our continued growth, and that Swish is now being offered as a payment method on a growing number of platforms,” says Anna-Lena Wretman, CEO of Getswish AB, the company that owns the payment service Swish.

“LeoVegas’ goal is to offer the ultimate gaming experience for our customers, and we are now making this even better with the launch of Sweden’s fastest deposit method via Swish,” says Gustaf Hagman, CEO of LeoVegas Group. “Faster than this, you cannot make your payments, and we are living up to our epithet: ‘lightning-fast deposits’. In addition, customers are securely identified via BankID. The fact that 63% of all Swedes use Swish every week shows how popular Swish is, and it is therefore extra exciting that LeoVegas is now offering the favourite way of making payments in Sweden. Our teams have worked intensively to be able to launch immediately after the turn of the year. That we are also lowering our transaction costs makes this a win-win arrangement and exemplifies the new opportunities for LeoVegas in the Swedish market,” the CEO adds.

LeoVegas is a critical player in the iGaming market of Malta. Technology development by the group is conducted in Sweden, while operations are based in Malta. LeoVegas offers casino, live casino and sports betting, and operates two global and scalable brands — LeoVegas and Royal Panda — as well as a number of local brands in the UK. The company’s shares are listed on Nasdaq Stockholm.

Launched in 2012 by six large Swedish bank in Sweden in cooperation with the Central Bank of Sweden, Swish is a mobile payment system that has approximately 6.7 million users (50%+ of Swedish population), as is reported to be favoured for its rapid and secure transactions over paying in cash.

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“We are now taking the next step on our global expansion journey and apply for our first license in a Spanish-speaking country, Spain,” says Gustaf Hagman, CEO of LeoVegas Group.

Mr Hagman tags Spain as one of the fastest-growing markets in Europe. The CEO believes that due to his group’s technology and experience; they will be able to effectively adapt their business to regulated markets regardless of language and regulations.

As more than 470 million people speak Spanish, the company sees entering Spain as a first step to get into several Spanish-speaking countries, the press release notes.

The Spanish casino market grew by more than 30% in Q3 2018 compared to 2017, and it is projected to be worth approximately €1bn in 2019, according to estimates provided by H2 Gambling Capital data, which is one of the gambling industry’s leading providers of figures and analyses. The Swedish market, in comparison, is worth approximately €1.4bn.

“Today only about 11% of all gaming in Spain is conducted online, compared with 52% in Sweden. Spain’s online gaming market is experiencing strong growth as more and more gaming is being conducted online. The most recent figures from the Spanish gambling authority show that the casino segment grew by 30% in Q3 2018 compared with the same period last year,” LeoVegas notes in the press release.

LeoVegas holds gaming licences in Malta, the United Kingdom, Denmark, Italy, Sweden, Ireland and now awaits for Spain.

LeoVegas’s announcement comes very shortly after a cut in gross gaming revenue from 25% to 20% has been approved by the Spanish government. LeoVegas appears to pop up as a fierce competitor of GiG in the market with a jumpstart, which announced similar plans very recently for the second half of the year.

The post LeoVegas to enter Spanish market in Q1 first appeared on The Malta Business Weekly.

The most recent reregulation was preceded by years of planning and takes place in an environment where Norway and Finland appear to hold strong gambling monopoly. Marching in the footsteps of Denmark, Sweden seems to open up its iGaming industry for private sectors, with the new legislation.

Under the new Swedish gambling law (SFS 2018:1138), companies are due to pay 18% tax for commercial gaming, a 0% tax rate applies for non-profit gambling activities, six different license types are available with prices varying from SEK 400,000-700,000 (roughly €38,200-€66,900), and an 18+ age limit is set for online gambling while a 21+ age limit applies to enter a physical casino, according to a report by gambling.com.

The new legislation is expected to create a safer market, improve consumer protection and game security, as well as provide clear market conditions. In the new environment, players can pause their accounts nationwide with a single action, as well as control tightens over illegal gambling activities.

All eyes on Malta

Malta is home to a handful of international iGaming operators and software providers, who are based in Sweden but carry out the bulk of their operations in the tiny Mediterranean island, so much so that Malta is often referred to as an iGaming hub.

The sector directly accounted for 11.3% of Malta’s gross value added — more than €1.1bn — in 2017 according to NSO statistics, after the country was the first to regulate the market in 2004. In 2017, the watchdog Malta Gaming Authority (MGA) issued a total of 165 new remote gaming licences, according to a report by EY in 2018.

Malta has seen the presence of Swedish software providers NetEnt, Evolution Gaming and Play’n GO, as well as casino operators Mr Green, Unibet, and Leo Vegas. These iGaming giants all have roots in Sweden but are also registered and therefore have operations in the island country. As a result, attention has risen over the market to see how the re-regulated Swedish environment would affect the sentiment in here.

The Maltese iGaming sector also needs to keep an eye out on Spain that has recently approved a remarkable tax cut of 5% for iGaming operator revenues. Gaming Innovation Group (GiG) and LeoVegas have already targeted the market by announcing expansion over there.

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