Svenska Spel posts full-year growth despite pandemic impact

Swedish operator Svenska Spel posted year-on-year revenue and net profit growth for its 2021 financial year, despite the impact of the novel coronavirus (Covid-19) pandemic.

Net gaming revenue for the 12 months through to 31 December amounted to SEK8.14bn (£658.0m/€781.1m/$892.3m), up 6.1% from SEK7.67bn in the previous year.

The Tur lottery division remained Svenska Spel’s main source of income, generating a total of SEK4.92bn, an increase of 1.7% on 2020, while the operator’s sports and casino business saw the most growth, with revenue climbing 20.8% to SEK2.36bn.

However, revenue from the Casino Cosmopol land-based casinos and Vegas-branded slot halls declined 1.6% to SEK872m, which Svenska Spel put down to the pandemic and measures imposed by the Swedish government on gambling venues in the early part of the year.

Turning to costs and while personnel expenses were reduced 7.3% to SEK1.04bn, other external spending increased 4.8% to SEK1.74bn.

Operating profit increased 3.1% year-on-year to SEK2.68bn, while after accounting for only minor financial costs, pre-tax profit remained at SEK2.47bn, which was 3.4% higher than in 2020.

Svenska Spel paid SEK511m in tax, meaning it ended the year with a net profit of SEK1.95bn, an increase of 4.4% from SEK1.87bn in the previous year.

“When we sum up 2021, it is with continued growth and good profitability for the group despite the unfavourable impact of the pandemic,” Svenska Spel’s chief executive and president Patrick Hofbauer (pictured) said. “Lottery and number games grew during the last quarter of the year, while sports games faced challenges as a result of cancelled matches.

“Our Casino Cosmopol is open with limited operations, and the Vegas vending machines are affected by the situation for restaurant partners. But despite the strong impact of the pandemic, the group is showing growth and stability.”

Looking to the final quarter of the year and revenue for the three months to 31 December was SEK2.23bn, up 4.9% from SEK2.13bn in 2020.

Revenue from the Tur business segment increased by 1.8% to SEK1.35bn, while Casino Cosmopol and Vegas slot halls revenue also rocketed 77.8% to SEK297m, helped by the easing of Covid-19 restrictions compared to Q4 of the previous year.

However, sports and casino revenue declined 7.7% year-on-year to SEK585m as Svenska Spel was hit by the cancellation of some matches, while interest in betting was generally weaker as events were impacted by Covid-19.

After operating costs, Svenska Spel said operating profit was 12.9% lower at SEK601m, while as financial costs were cancelled out by financial income, pre-tax profit remained SEK601m, 12.8% down on the previous year.

Svenska Spel paid SEK126m in tax, leaving a net profit of SEK475m for Q4, a drop of 13.2% from SEK547m in 2020.

“It is very gratifying that the restrictions in society are now being lifted,” Hofbauer said. “This means that we can welcome our guests at Casino Cosmopol to a business with longer opening hours and a larger range of games.”

“We want gaming to be fun for everyone and look forward to continuing to offer entertaining gaming experiences in a responsible way in 2022.”

Author: Raymond Fleming