Revenue growth drives Lottomatica to net profit in first full year
Lottomatica was able to report a net profit of €79.3m (£69.7m/$84.0m) for its 2022 financial year following a 72.8% increase in revenue.
Last year was Lottomatica’s first full year operating as a standalone business after Gamesnet Group in June 2021 acquired the Lottomatica-branded B2C operations from IGT, changing its name to Lottomatica in the process.
Towards the end of 2022, Lottomatica also agreed a deal to purchase Italian online sports betting and casino operator Betflag in what was its first acquisition as a standalone business. The deal went through in December and further expanding its operations in Italy.
Though BetFlag was only consolidated within the business from December, the combination from 2021 had a major impact, with revenue in the first full year of operation increasing to €1.41bn for the year, compared to €815.4m in the previous financial year.
Revenue from the operator’s gaming franchise jumped by 93.3% year-on-year to €725.5m, representing 52.0% of total revenue for the financial year. This was driven by an 87.1% rise in the total amount wagered by players to €11.12bn.
Sports franchise revenue also increased by 122.5% to €340.8m, with customer bets hiking 118.5% to €2.53bn, despite a drop in the number of concessions and licensees, as well as a fall in the number of active points of sale by the end of the year.
In addition, online franchise revenue jumped 17.5% to €328.6m as wagers climbed 36.0% year-on-year, helped by a wider product range and improvements to its online offering.
Turning to spending, costs were higher in almost all areas, with the main outgoing being cost of services, which was 62.8% higher. Net finance costs were also up, but the impact of revenue growth meant a pre-tax profit of €134.5m, compared to a €50.3m loss in 2021.
Lottomatica paid €55.2m in income tax and also accounted for a €6.3m profit attributable to minority interests, meaning net profit attributable to the group for the year was €73.0m, in contrast to a €57.6m loss in the previous year. In addition, EBITDA was 101.8% higher at €460.4m.
The group also published a trading update for its operations in January and February of the current year, during which it processed €4.8m in total wagers across the business.
Revenue in the two-month period was approximately €281.0m, with online revenue up 39.0%, sports revenue 19.0% and gaming 12.0%.
Lottomatica said guidance for the full year is between €1.57bn and €1.67bn for revenue and €550.0m, and €570.0m for EBITDA.
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