LeoVegas Saw a Huge Increase in Profits in 2020
Despite the covid-19 pandemic and a number of changes in market regulations, LeoVegas (STO: LEO) has reported overall revenue of €387.5 million for 2020, up 8.9% from 2019.
With cost of sales for the full financial year at €67.9 million and gaming duties at €57.3 million, the online casino operator enjoyed a gross profit of €262.3 million for 2020, up 10.6% from the previous year.
In 2020, LeoVegas paid €210.5 million in operating expenses. Most of these were marketing expenses, at €132.6 million, followed by personnel costs at €50.5 million. These figures include €51.9 million in earnings before interest, tax, depreciation and amortization (EBITDA), an increase of 4.9% year on year.
Unsurprisingly, LeoVegas’ CEO Gustaf Hagman was enthusiastic about the figures and described 2020 as “yet another record year for LeoVegas with a strong close”.
Before tax, the operator’s profit almost doubled from 2019’s €10.3 million to €21.5 million. The company paid €2.2 million in income tax, and even with the negative impact of currency conversion, it still ended the year with a €19.3 million profit, an increase of 103.2% from 2019.
The fourth quarter of 2020 was particularly impressive. Revenue increased 13% to €98.4 million and organic growth in local currencies increased 14%. Nordic countries in particular were strong, accounting for 36% of the group’s net gaming revenue (NGR), while the rest of Europe accounted for 47%. The rest of the NGR came from other countries around the world.
In Q4, the vast majority of LeoVegas’ gross gaming revenue, 75%, came from casino games such as slots, while live casino brought in 16% and sports betting 9%. Furthermore, the number of depositing customers grew by 24% to 461,983.
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The company also pointed out that in Q4 it became the first in the gaming industry to offer payments through Open Banking and it also launched its enormous LeoJackPot. Furthermore, LeoVegas issued SEK500 million worth of senior unsecured notes to guarantee its long term financing.
The company has plans to expand into more existing regulated markets and markets that are soon to be regulated. There are numerous countries around the world planning to introduce online gambling regulations, including in the EU, Latin America and the US, meaning that there is vast potential for LeoVegas’ expansion.
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