Super Group cuts full-year sales and earnings guidance following general economic uncertainty in the first half, but remains healthy with underlying business and optimistic about future growth potential said that it is a target.
Operators who count Betway and Spin among their brands say they continue to feel the impact of the normalization of entertainment spending patterns during the post-pandemic period and the headwinds of general economic uncertainty on discretionary spending. I was.
Betway has warned that this is likely to be the case for the rest of the year and has issued updated guidance to reflect this.
Full-year earnings are expected to reach €1.15 billion (£972.7 million/$1.19 billion), up from the original guidance of €1.4 billion issued in the 2021 results. Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) are projected to range from $200 million to €215 million, down from previous estimates of €345 million doing.
However, Supergroup CEO Neil Menachee said in the earnings call that the year-over-year results for the first two quarters of 2022 did not adequately reflect the “handling” of the last 12 months. said the business remained in a strong position.
“Continued regulatory changes post Covid normalization will ultimately benefit supergroups because we have an efficient cost structure and a track record of more than 20 years of profitable trading. Because there is,” said Menashe. “Importantly, controlling marketing, product and operational costs gives us many avenues to optimize them.
“We believe the online game business is resilient, but it cannot escape macroeconomic pressures. What Super Group has is a global footprint and a competitive cost structure, which We plan to maintain and improve it.
“We face these pressures, but the underlying business is healthy and will continue to grow.”
Revenue decreased from €355.2 million in Q2 2021 to €320.8 million. Online casinos are the main source of income, with him generating €204.3 million in the fourth quarter, with sports betting ahead of him with €110.6 million and brands with his licenses with €5.8 million.
Betway generated €178.7 million in revenue among its two core brands, beating Spin’s €142.1 million.
In terms of geographic performance, North America revenue reached €142.1 million, Asia Pacific revenue €77.4 million, Africa and Middle East revenue €63.6 million, Europe revenue €30.5 million, South America and Revenue in Latin America reached €7.2 million. North America earnings could grow further in the next quarter following recent approvals in Ontario, Canada.
Direct and marketing expenses were reduced by 3.4% to 225.7 million euros, while general and administrative expenses remained relatively flat year-on-year and depreciation decreased.
The Group also noted a positive impact of €219.3 million in fair value change on earn-out liabilities and a positive €64 million in fair value changes on warrant liabilities. As a result, pre-tax profit increased by 354.0% year-on-year to his 304.2 million euros, despite lower earnings.
Super Group paid €5.6 million in taxes and reported negative foreign exchange equivalent to €3.5 million. This means that from 2021 he finished the quarter with his net profit of €295.1 million, up 374.4%.
Looking at the first half, revenues for the six months to 30 June were €655.3 million, down 1.8% year-on-year. Online casinos were by far the main source of income, generating 408.2 million euros, sports betting he generated 220.2 million euros, and brand licenses he generated 25.7 million euros.
Direct and marketing expenses were up 4.1% at 466.4 million euros, while general and administrative expenses were down 8.3% and depreciation was down 25.7%.
Looking at other costs, Super Group reported a positive impact of €194.9 million on the change in the fair value of its earn-out liability and €34.6 million on the fair value of its warrant liability. However, this was partially offset by stock-based compensation expenses of €125.3 million and his €24 million foreign exchange from the revaluation of warrants and earnouts.
However, profit before tax was still up 38.2% to €149.9m, giving the Super Group a net profit of €133m, up 30.0m after taking into account tax payments of €14.6m and negative FX translation of €2.4m. Profits left. % YoY.
“Our balance sheet remains strong, our business fundamentals are sound and we remain focused on long-term opportunities around the world,” said Menashe.
