A Tale of Three Markets; Dragged by Germany, LeoVegas Posts Negative Q2

Kept positive by an all-time high in Sweden, and the successful integration of its newly-acquired Expekt sports book, iGaming group LeoVegas has, nevertheless, reported a major drag in its German market during its second quarter, ending June 30, which has precipitated a 13 per cent slump in revenue to €96.8 million (£82.07m/US$113.54m).

Draconian re-regulation in German gaming–featuring strict product limitations and high tax–hammered the group’s operations in Europe’s most populous nation, with LeoVegas revenue in the country diving 81 per cent, year-on-year.

If one removed Germany from the financial equation then the online firm would have reported an overall positive growth of three per cent during the quarter.

But LeoVegas’ Adjusted EBITDA in Q2 was down to €10.6 million (£8.98m/€12.43m) — a significant drop from the €23 million (£19.5m/€27m) reported for the same period last year.

Overall customer retention stayed strong, however, and there was positive news with Expekt’s doubling of revenue and market share in Sweden aided, in great part, by the success of the Euro 2020 Football Championship.

There were great indicators, too, from burgeoning LeoVegas operations in North America, which now garner a tenth of group revenues.

Expansion in the USA, starting in New Jersey, is on track.

And in Canada’s populous Ontario province, soon to liberalise online gaming, LeoVegas has already built a strong brand with a large and loyal customer base.

“[Although] Germany continued to negatively impact figures during the period, most of our markets have continued to develop well, with high, double-digit growth in key markets like Italy and Spain.

“The development in Sweden is encouraging, with record-high revenue during the quarter,” said group CEO Gustaf Hagman, CEO of the Scandinavian Malta-headquartered group.