In a topsy-turvy financial half, battered and bruised by the Coronavirus Covid-19 pandemic like most of the world’s sports betting operations, Sweden’s Svenska Spel is still standing — and, believe it, poised to surge back stronger.
The state-owned gambling company, which means ‘Swedish Games’ in English, has reported a near 10 per cent drop in revenues but, paradoxically, an increase in profits.
Revenue for the six months to June 30 declined to SEK3.70bn (US$410.4m), Patrik Hofbauer, the firm’s Chief Executive, has confirmed.
As in most other countries, there was a big drop in real-world gaming action—such as betting in casinos, traditional mainstream sports and the slots—but significant growth in virtual gambling, which eased the financial pain.
The firm’s ‘Tur’ lottery business, for example, helped to offset losses in its online ‘Sport & Casino’ and land-based ‘Casino Cosmopol’ and ‘Vegas’ divisions.
Tur revenue grew 3.8 per cent to SEK2.33bn (US$261m). But income from Sport & Casino, because of the sporting events shutdown, fell by almost one-fifth to SEK829m (US$93.15m).
In Svenska Spel’s four real-world Cosmopol casinos and other gaming arcades–which have been shuttered since March 29–revenues fell proportionally even further, by 36.2 per cent to SEK542m (US$60.89).
In a bid to boost its disrupted markets, the firm introduced digital tickets for Tur products — and re-launched proxy sales to bring back older punters, many of them sheltering from Covid-19 turbulence.
Other innovations, among health and safety improvements, have included contactless payment for Vegas slot machines and an expansion to more than 1,000 games in its online casino offering.
And, most importantly, the company asserted, the shift to playing these new games has not increased risky behaviour.
This April, despite the impact of Covid-19, Svenska Spel was able to donate SEK20m (US$2.25m) to 3,600 ‘Gräsroten’, or grass root social and welfare programs, across Sweden, to help them weather the crisis.
The state gambling operator paid out SEK620m (US$69.67m) in gaming taxes in the first financial half, down from SEK783m (US$87.99m) compared to the same period last year.
Costs were down 14.1 per cent to SEK507m (US$56.98m), leaving net revenue of SEK2.72bn (US$305.7), a drop of 4.4 per cent.
But–thanks to declining personnel and other external costs–operating profit during the period was up 11.5 per cent to SEK1.17bn (US$131.5m).
Overall, income tax paid by Svenska Spel climbed to SEK825m (US$92.72), which left a net profit of SEK885m (US$99.47), an increase of 7.3 per cent.
“We have shown an ability to innovate and great perseverance during a tough time,” said Hofbauer.
“We have launched new games and improved the gaming experience for our customers.
“Despite Covid-19 having a significant impact in so many ways, and despite the fact that this pandemic is not yet over, things look brighter going forward.
“We are on the way up again after having managed the rapid transition to the big and unexpected changes during the spring.”