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NetEnt: Year-end report 2019 and quarterly report October – December 2019

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Quote from Therese Hillman, Group CEO

“Since December, we have seen all-time highs in the number of players for our Live Casino, which supports our belief in growing revenues from this segment. Since the acquisition, Red Tiger has exceeded our expectations and now forms a vital part of our ongoing improvement efforts within the NetEnt Group. We see good conditions for NetEnt to deliver growth in 2020, supported by our combined game portfolio and Live Casino.”

Fourth quarter 2019

  • Revenues for the fourth quarter amounted to 512 (465) SEKm
  • EBITDA of 261 (204) SEKm, corresponding to a margin of 51.0 (43.9)%
  • EBIT of 161 (146) SEKm, corresponding to a margin of 31.4 (31.4)%
  • Earnings after tax of 113 (137) SEKm. Earnings per share of SEK 0.47 (0.57) before and after dilution
  • Red Tiger contributed 96 SEKm to revenues and 70 SEKm to EBITDA

Full year 2019

  • Revenues for the full year amounted to 1,793 (1,782) SEKm
  • EBITDA of 855 (816) SEKm, corresponding to a margin of 47.7 (45.8)%
  • EBIT of 529 (601) SEKm, a margin of 29.5 (33.7)%
  • Earnings after tax of 429 (577) SEKm. Earnings per share of SEK 1.79 (2.40) before and after dilution
  • The results include SEK 59 million of acquisition-related transaction costs and amortization, and SEK 29 million of acquisition-related financing costs
  • Red Tiger was consolidated in September and contributed 126 SEKm to revenues and 93 SEKm to EBITDA
  • Proposed ordinary cash return to shareholders of SEK 1.00 (2.25) per share

Important events in the fourth quarter

  • NetEnt released 13 (6) slot games, of which Ozzy Osbourne was the most successful
  • Red Tiger released 9 (6) slot games, of which Dynamite Riches was the most successful
  • The platform service NetEnt Connect was introduced in December, with Red Tiger as first supplier
  • Within Live Casino, a new Auto-Roulette studio was launched

Growth through acquisition

Revenues for the last quarter of the year increased by 10.0 percent to the highest level ever, SEK 512 million (465 SEKm), of which SEK 96 million came from Red Tiger, which was acquired in September. Pro forma(1) in euro terms, our total revenues including Red Tiger decreased by 4.8 percent compared to the corresponding period of 2018. Growth was held back by continued weakness in mainly Sweden and Norway, while our revenues in the US continued to grow significantly. During the period January 1 to February 10, 2020, total gamewin proforma(1) in euro terms for the NetEnt Group including Red Tiger increased by 4.9 percent compared to the same period of the previous year.

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Operating income and cash flow in the fourth quarter

Earnings before interest, tax, depreciation and amortization (EBITDA) amounted to SEK 261 (204) million in the quarter, of which SEK 70 million was contributed by Red Tiger. The EBITDA margin was 51.0 (43.9) percent. Red Tiger was acquired with the objective to create shareholder value through increased growth and profitability for the new group. The transaction was enabled by NetEnt’s strong balance sheet, which went from a net cash to net debt position, and our long-term goal is to deliver enhanced shareholder returns with a balanced capital structure. Hence, the proposed cash return to shareholders for 2019 is SEK 1.00 (2.25) per share, which supports the company’s cash flow generation and allows for debt to be reduced. This payout level is in line with the company’s dividend policy.

High level of activity and deeper integration with Red Tiger

We released more games than ever in the fourth quarter – 13 (6) from NetEnt and 9 (6) from Red Tiger – and continued to sign deals with and launch customers at a high pace. In addition, the quarter was marked by deepening integration with Red Tiger to realize both revenue- and cost synergies. Red Tiger adds complementary competence to the NetEnt group and we are running a number of common projects at full speed to deliver a significantly enhanced customer offering and player experience. Our first combined game with jackpot mechanics, Piggy Riches, was released in January and has so far been the best release ever for Red Tiger. During 2020, we will be releasing several new jointly developed games. In December, we launched our content aggregation service, NetEnt Connect, with Red Tiger as the first supplier. In 2019, we reduced the number of employees at NetEnt (excluding Red Tiger) while at the same time we stepped up our game production and efforts to develop our Live Casino offering. We continue to focus on cost control and efficiency throughout the NetEnt Group and the integration of Red Tiger forms a vital part of this process.

All-time high in player numbers for Live Casino

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We continue according to plan to improve our product and organization within Live Casino, and in December we launched a new Auto-Roulette studio. Feedback on the product enhancements made during 2019 has generally been positive and since December, we have seen all-time highs in player numbers for our Live Casino. We are now expanding the studio in Malta and will soon be offering physical tables to our customers for the first time, as an alternative to our tables with blue screen technology, which should contribute to increased revenues from Live Casino in 2020.

Future outlook

We recently unveiled a number of product news at the ICE exhibition in London, such as a new jackpot concept called Starburst Power Pots, as well as branded games in collaboration with Gordon Ramsay, Street Fighter and Fashion TV – again showing our commitment to creating a world-class player experience.
I would like to take this opportunity to extend my thanks to our employees, customers and shareholders for their support during 2019. Backed by our ongoing focus on efficiency and the acquisition of Red Tiger, we are entering the new year in a stronger position. Our global distribution and two strong brands give us the right basis to increase our market shares in online casino. We see good conditions for NetEnt to deliver growth in 2020, supported by our combined game portfolio and Live Casino.

(1) Comparable figures from the previous year include Red Tiger.

 

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About NetEnt:

NetEnt AB (publ) is a global gaming company, providing premium gaming solutions to the world’s most successful online casino operators. In addition to the company’s NetEnt brand, our portfolio also includes Red Tiger Gaming. Since our start in 1996, we have been a true pioneer in driving the market with innovative games powered by a cutting-edge platform. NetEnt is committed to creating the future of gaming, is listed on Nasdaq Stockholm (NET–B) and employs around 1 100 people in Malta, Stockholm, Sofia, Kiev, Krakow, Gothenburg, Gibraltar, Isle of Man, London and New Jersey. For more information, please visit www.netent.com.

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ZEAL Network CEO Helmut Becker Will Not Extend His Contract Beyond January 2026

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Dr. Helmut Becker, CEO of ZEAL Network, has informed the Supervisory Board of the company of his decision not to extend his contract, which runs until January 31, 2026. The 56-year-old has decided to pursue his own entrepreneurial activities in the future after many years as a top manager. Dr Becker will then leave the company after more than twelve years on the Executive Board of ZEAL Network SE, including more than ten as CEO. He will remain fully committed to ZEAL as CEO until the end of his contract term and will ensure a smooth transition of his duties to a successor.

“ZEAL is in an excellent position to continue to grow in the future. After almost ten years as CEO, I have decided that now is the right time to pursue my own entrepreneurial endeavours. This has been a difficult decision for me. I will especially miss our exceptionally strong team and the unique culture we have built together, characterised by innovation, customer focus and team spirit. I will continue to work hard until the end of my term to achieve the goals we have set together,” said Dr Becker.

Dr Becker informed the Supervisory Board of ZEAL Network SE about his decision at an early stage, and the Supervisory Board will immediately initiate a structured process for the succession of the CEO.

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Peter Steiner, Chairman of the Supervisory Board, said: “The Supervisory Board of ZEAL Network SE has noted with great regret Helmut Becker’s decision not to seek a contract extension. Helmut Becker has played a decisive role in taking ZEAL’s business development to a new level. Under his leadership, ZEAL has established itself as a market leader in the online lottery market, significantly expanded its customer base and crucially broadened its offering through innovative product development. On behalf of the Supervisory Board, I would like to thank him for his outstanding commitment and strategic vision. We wish him all the best for his personal life and professional career.”

Dr Becker has been CEO of ZEAL Network since September 1, 2015, after serving as Chief Marketing Officer (CMO) for over two years. Prior to joining the Executive Board, he was a member of the Supervisory Board of ZEAL for two years. Previously, he served as Chief Commercial Officer on the Management Board of XING AG and held various management positions at eBay Germany and as a management consultant at McKinsey. As CEO, Dr Becker was responsible for the acquisition of LOTTO24 AG, the return of ZEAL to Germany and the expansion of the portfolio to include freiheit+, Games and Traumhausverlosung.

The post ZEAL Network CEO Helmut Becker Will Not Extend His Contract Beyond January 2026 appeared first on European Gaming Industry News.

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Gamblorium Enhances Casino Reviews with Updated Rating System

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Gamblorium, a trusted online casino affiliate platform, announces its new and improved casino rating system. This updated system is designed to give players even more accurate and transparent rankings for online casinos. Since 2020, Gamblorium has been known for providing honest and expert-tested casino reviews. With this updated rating system, Gamblorium continues to ensure players can easily find the best gambling sites.

The new rating system combines three key components: Gamblorium Score, Player Score and Market Score. These scores are based on a 100-point scale, providing players with a clear and reliable way to choose casinos that meet their preferences.

Main features of Gamblorium’s new rating system:

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• Gamblorium score: The Gamblorium Score evaluates casinos based on over 100 criteria, including payment methods, game options, security and user experience. Unlike other platforms, Gamblorium uses a relative and flexible approach, meaning casinos are ranked based on their strengths within their market. This score also incorporates Expert Scoring, ensuring that the most important factors are weighted appropriately.

• Player score: The Player Score is based on feedback from real users. Players can leave reviews only if they have registered or played at the casino, ensuring honest and up-to-date feedback. This makes the reviews highly reliable and reflective of the actual player experience.

• Market score: The Market Score helps balance the overall rating by considering the views of other trusted gambling platforms. This adds another layer of objectivity and ensures that Gamblorium’s reviews remain fair and unbiased.

The post Gamblorium Enhances Casino Reviews with Updated Rating System appeared first on European Gaming Industry News.

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CT Interactive Appoints Dimitar Raychev as Technical Support Specialist for Online Services

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CT Interactive has appointed Dimitar Raychev as Technical Support Specialist for Online Services.

Over the years, Dimitar has worked with various platforms such as AWS, Active Directory and SAP, allowing him to acquire deep knowledge and skills in managing infrastructures and automating processes. Thanks to his expertise, he has helped many organisations optimise their systems and maintain high levels of efficiency.

“We are thrilled to welcome Dimitar Raychev to the CT Interactive team, where he will take on the role of Technical Support Specialist for Online Services. Dimitar brings extensive experience in providing technical support to global clients, successfully diagnosing and resolving issues with software, hardware and network systems. His commitment to quality service and the technical skills he possesses make him a valuable asset. We look forward to leveraging his knowledge and continuing to provide our clients with impeccable service and support,” the company said.

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The post CT Interactive Appoints Dimitar Raychev as Technical Support Specialist for Online Services appeared first on European Gaming Industry News.

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