NetEnt Irons out New Opportunities in Q1 2019 ReportPublished May 4, 2019 by Lee R
The organisational growth of NetEnt was characterized by the new opportunities in Sweden and New Jersey, per Q1 report.
The latest NetEnt report for Q1 2019 provides new insights into the most effective ways to develop one of iGaming's major forces.
CEO Explains Growth
NetEnt Group CEO Therese Hillman provided the organisational context for the new numbers:
“In the first quarter, we continued to focus on improvements throughout the organization. The operating margin (EBIT) was 30.2 percent. It is difficult to predict the long-term market dynamics, but with our investments in new games, Live Casino, new functionality for customers and players, as well as a strong balance sheet, we are in a good position to defend and, longer-term, increase our market shares.”
More highlights of the specific market performance figures include Q1 revenues reaching SEK 418 (430) million; with EBITDA's SEK 196 (182) million total representing a margin of 47.0 (42.2)%.
Meanwhile, Operating profit (EBIT) reached SEK 126 (134) million for a margin of 30.2 (31.2)%; with net profit reaching SEK 120 (146) million.
The figures overall brought earnings per share to SEK 0.50 (0.61) before and after dilution, as 8 new customer agreements were signed and 9 new customer casinos launched.
Key Q1 Events
Impactful external events include a new customer contract signed with Parx Casino in Pennsylvania (USA); the release of five new slot games including the leading title Turn your Fortune; brand collaborations on new games Conan and Ozzy Osbourne; the unveiling of the new Live Casino product Perfect Blackjack; the securing of authorization to deliver games in the US state of Pennsylvania (USA); and permanent licensing in New Jersey (USA).
Q1 2019 also marked the first complete reckoning of the impact of the newly regulated Sweden market. The first returns were slightly underwhelming, with Q1 total revenues for NetEnt decreasing by 2.8 percent (-7.0 percent in euro) year-on-year, with the lull attributed to Nordic disruptions. The largest hiccup was the low volumes in Sweden in the transitional period to new regulation.
More Scandinavian Forays
Looking forward, Hillman revealed that NetEnt is preparing to launch games with Finnish state- controlled operator Veikkaus while distributing more games to Norsk Tipping in Norway. She also emphasised the huge growth potential she sees in New Jersey, where penetration is just beginning, and when projected to the scale of the Nordic markets also offers huge growth benefits.
With the key hiccups likely to be ironed out by the next quarter, and footholds in promising new markets, NetEnt appears positioned for another level of significant growth.