Cherry on Top: Revenues Show Sweet Q1 for CherryPublished May 20, 2016 by Lee R
As iGaming competition grows, Cherry is finding ways to stay ahead.
Stockholm-based operator Cherry AB has reported encouraging results for Q1 as well.
The undeniable trend of growth in iGaming was maintained in Cherry's positive gains reported for year-on-year growth in terms of both revenue and adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) for the figures for the three months leading to March 31.
Total group revenue for the quarter topped out at SEK177.3 million (€19.1 million/$21.8 million), a stunning yet appropriately reflective jump of 86% from the SEK95.3 million posted in the same period last year.
Adjusted Earnings Skyrocket
EBITDA rebounded from losses of SEK4.5 million last year to post a positive figure of SEK25.6 million in the first quarter of 2016, while earnings before interest and tax also vaulted from negative SEK8.9 million to vault SEK25.6 million into the red.
Online Share Grows
The increase in online revenue earning was key component of this recovery, with Cherry disclosing that noted that online services account for 78% of its total revenue, compared to 63% last year, while online gaming business expanded 118% year-on-year to achieve an EBITDA of SEK16.5 million.
A lynchpin of Cherry's growth was new acquisition Yggdrasil Gaming. Cherry's new holding achieved year-on-year growth of 519%, with EBITDA up from a loss of SEK400,000 to a plus of SEK7.9 million.
Cherry CEO Fredrik Burvall characterized these developments as consistent with his Cherry's strategy of combining organic growth with strategic acquisitions in order to grow at a faster rate than the market.
Burvall is extremely confident and pleased looking ahead, identifying his companies diversified holdings as ideal for stated operational priorities of “continued strong expansion, strong profitability and strong growth of value.”
The stated model of sustainability indicates how iGaming competition is going to heat up, with the most effective performers diversifying through strategic acquisition to stay ahead of an increasingly competitive market whose overall growth is driven by technological innovation.