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LeoVegas AB Q4: Year-end report 2020

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“Yet another record year for LeoVegas with a strong close” – Gustaf Hagman, Group CEO

fourth quarter 2020: 1 october–31 december        

  • Revenue increased by 13% to EUR 98.4 m (87.1). Organic growth in local currencies was 14%.
  • Adjusted EBITDA was EUR 11.5 m (9.2), corresponding to an adjusted EBITDA margin of 11.7% (10.6%). Reported EBITDA includes EUR -3.5 m (5.3) in items affecting comparability.
  • The number of depositing customers was 461,983 (372,032), an increase of 24%.
  • Adjusted earnings per share were EUR 0.08 (0.06).

Events during the quarter

  • LeoVegas was the first company in the gaming industry to offer payments via Open Banking.
  • During the quarter the Group’s unique and record-large jackpot was launched under the name LeoJackPot.
  • LeoVegas secured long-term and diversified financing through a combination of a bank credit facility (RCF of EUR 40 m) and a bond issue of SEK 500 m under a total framework of SEK 800 m.
  • During the quarter, LeoVegas repurchased its own shares for approximately EUR 5 million.
  • Ahead of the forthcoming regulation in Germany, a number of changes were implemented. This led to lower revenue during the quarter, with the greatest effect during the month of December.
  • LeoVegas has changed its interpretation of the calculation of gaming taxes in Denmark for earlier periods. This resulted in a self-correction, and a one-off cost of EUR 3.5 m has been charged against EBITDA.
  • Decision has been taken to migrate the Royal Panda brand to the Group’s proprietary technical platform.

Events after the end of the quarter

  • Preliminary revenue in January amounted to EUR 32.5 m (29.9), representing growth of 9%.
  • The Board of Directors proposes a raised dividend totalling SEK 1.60 per share (1.40), an increase of 14%, to be paid out on four occasions during the year.

 

COMMENT FROM GUSTAF HAGMAN – GROUP CEO

STRONG CLOSE TO 2020
LeoVegas concluded the record year 2020 with its strongest fourth quarter ever. And we did this despite frequent changes to the gaming requirements in our markets in addition to finding ourselves in the midst of a global pandemic. I am proud of our ability to quickly adapt to changed conditions through a high capacity for innovation at the same time as we are building an increasingly solid and diversified business. It is a demonstration of strength that LeoVegas delivered adjusted EBITDA growth of 25% for the full year while the operating cash flow increased almost 90 %. This was achieved despite maintaining a high investment pace with launches of new brands, new markets and product improvements.

During the fourth quarter we increased our revenue organically by 14%. Growth was mainly driven by a continued rise in depositing customers, which grew 24% to a new record level. Adjusted EBITDA increased by 25% during the quarter to EUR 11.5 m.  Reported EBITDA was charged with a one-off provision of EUR 3.5 m related to a changed interpretation of the calculation of gaming taxes in Denmark for earlier periods.

MarkETS
With the exceptions of Sweden and the UK, our core markets showed high double-digit growth during the quarter. Above all I want to highlight Italy, which has now become one of our five biggest markets. During the quarter we launched the Pink Casino brand in Canada. The launch is part of our multibrand strategy, where we are utilising existing resources and our technical platform to expand through scale.

In the German market, LeoVegas has implemented a number of changes ahead of the forthcoming licence system in July 2021. As expected, this affected revenue during the period. Operators in the market are acting differently with respect to the new restrictions, and at present necessary clarity is lacking in the ongoing transitional period, which unfortunately has led to a skewed competitive situation until the licence system has been fully implemented.

TECHNOLOGY AND PRODUCTS
During the quarter we carried out and launched several major projects and innovations. In particular I want to highlight our new exclusive jackpot – LeoJackpot – where our customers can win over SEK 50 m directly from their smartphones. We were also first in the industry to offer payments via Open Banking. This will benefit LeoVegas and our customers in many ways, including through more secure and faster payments and lower transaction costs.

During the quarter we began the migration of Royal Panda to our joint technical platform. As a result, in 2021 all brands will be operated on the same platform. The migration will lead to cost synergies such as lower platform and product costs and a more efficient organisation. The decision has also resulted in impairment of intangible assets attributable to Royal Panda’s platform, which was charged against EBIT in the amount of EUR 1.9 m.

FINANCING AND INVESTMENTS
At the end of the year we secured the Group’s long-term financing needs through the combination of a renewed bank credit facility of EUR 40 m and a newly issued corporate bond of SEK 500 m.

Stable financing combined with a strong balance sheet gives us a solid base for continued expansion, both through organic initiatives and potential acquisitions. During the fourth quarter we carried out share repurchases for approximately EUR 5 m. In addition, the Board of Directors proposes an increase in the dividend to SEK 1.60 per share.

COMMENTS ON FOURTH QUARTER
Revenue for the month of January amounted to EUR 32.5 m (29.9), corresponding to annual growth of 9%. In January revenue was fully impacted by the changes carried out in Germany ahead of the forthcoming regulation.

On the tailwinds of a strong 2020 we are now looking forward to a year with many exciting growth initiatives and an even stronger customer offering.

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Games Global

Striking a successful franchise: Building enduring value through high-impact IP

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Mark MacCombie, Chief Commercial Officer at Games Global, discusses how combining creative evolution with strategic precision keeps franchises like Gold Blitz™ at the forefront of player engagement and market performance.

New games drop daily, and the challenge is not just to be seen, but to be remembered. While it might seem tempting to think the only way to make noise is to completely reinvent the wheel, in reality, sometimes the smartest path to longevity is knowing when to build on established foundations. In an industry that moves at breakneck speed, the boldest move is often to double down on what you already do best and elevate proven concepts to new heights.

At Games Global, we know that the titles which stand the test of time strike the right balance between refreshed ideas and lasting appeal. Franchises succeed when they preserve the elements players already love, then expand on them with purpose and precision.

It is important for us as a global company to approach franchises as a core strategic pillar. They are not a byproduct of success, but rather a deliberate move, built with intent, shaped by an understanding of what drives player loyalty, and guided by an ambition to grow across markets and over multiple releases.

Success in this space comes from respecting the DNA of a title while having the courage to enhance it in ways that add genuine depth. Every decision is grounded in data from real player behaviour, insight from our operators, and the creative instincts of our studio partners. That combination of perspective and imagination is what allows us to launch games that feel instantly recognisable yet undeniably fresh.

The Gold Blitz™ franchise exemplifies this philosophy perfectly, with Gold Blitz Express™, the fourth instalment in the core Gold Blitz™ series, retaining the dynamic audiovisual design and Cash Collect mechanic that make it instantly recognisable for returning players. At the same time, it introduces the brand-new Express feature, which has already gained significant traction across our wider portfolio, alongside deeper bonus round progression with an Accumulation Trail, integrating an entirely new concept into the franchise.

These enhancements upgrade the overall experience, increase reward potential, and build intrigue, keeping energy high from the first spin to the last. When we set out to create Gold Blitz Express™, the objective was to build on what already worked rather than replace it. This is not change for the sake of change, but a considered approach focused on refinement, adding value and variety while remaining true to the heart of the original game.

This evolution is intentional. Every creative choice is part of a development process that combines discipline with innovation. Our studios have the freedom to explore bold ideas, but they are supported by a central framework that offers performance data, trend analysis, cross-market insights, and operator feedback. Obtaining this balance encourages experimentation while ensuring each title aligns with commercial goals.

Every sequel is approached as an opportunity to refine gameplay, adjust the pacing of features, and introduce surprises that feel like a natural extension of the brand. Features like this are what spark the interest of players while preserving the qualities they already love. The aim is to deliver games that keep people returning, not because of habit, but because each session offers something worth returning for.

Commercially, franchises offer powerful advantages. Operators know they are working with a dependable performer, while players experience a sense of trust that has already been established. This creates momentum from day one of launch, enabling faster adoption and longer lifecycle performance than a completely new IP might achieve.

Franchises like Gold Blitz™ show how a well-considered evolution can have more impact than a complete reinvention. They demonstrate the strength of building on a solid foundation, adding new layers of engagement without losing the heart of the experience.

In a crowded marketplace, the real differentiator is smart progression, the kind that earns attention quietly and holds it for the long term. It is this progression – not the loudest change – that keeps a title relevant, rewarding, and poised to thrive for years to come.

The post Striking a successful franchise: Building enduring value through high-impact IP appeared first on EE Gaming | Global iGaming & Tech Intelligence Hub.

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Acquisitions/Merger

RubyPlay agrees to acquire Splash Tech to add jackpots and free-to-play tools

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Deal expands RubyPlay beyond content into platform-level engagement; transaction remains subject to regulatory approvals.

RubyPlay has entered into an agreement to acquire 100% of the shares in Splash Tech, as the supplier moves beyond content into platform-level engagement tools. The transaction is subject to regulatory approvals.

RubyPlay said the acquisition will add Splash Tech’s jackpot solution and Free-to-Play casino and sports capabilities to its existing engagement suite, which includes free spins, rewards, missions and tournaments. Following completion, RubyPlay’s operator partners will gain access to the Jackpot and Free-to-Play tools, designed to support engagement across third-party content as well as RubyPlay titles.

The company said Splash Tech’s engagement tools are already live with “some of the biggest operators and platform providers” globally. RubyPlay also said Splash Tech’s real-money jackpot product can turn “any product across all verticals into a jackpot game.”

Tsachi Maimon, CEO of RubyPlay, said: “Through this acquisition, we are moving beyond the traditional content silo to firmly establish RubyPlay as a premium content and engagement platform provider. This elevated market position ensures we are delivering new revenue streams for our partners, providing them with effective ways to address player acquisition and retention.

“Splash Tech has earned a strong reputation within the industry for driving innovation within the engagement tools space, underpinned by its superior expertise, data and content. Bringing the company’s capabilities into our broader offering marks a pivotal moment for RubyPlay’s evolution.”

Adam Wilson, CEO of Splash Tech, said: “Becoming a RubyPlay company will give Splash Tech a stronger foundation for growth, with continuity at the heart of this transition. Existing Splash Tech partners will continue to benefit from the same trusted products, expertise, and relationship focus they expect from us, and we’re looking forward to working alongside new partners with RubyPlay.

“As a global B2B iGaming company with a growing operator network and multi-market reach, RubyPlay brings greater scale, operator insight, and market credibility to support our ambition for further expansion and innovation.”

The post RubyPlay agrees to acquire Splash Tech to add jackpots and free-to-play tools appeared first on EE Gaming | Global iGaming & Tech Intelligence Hub.

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Danny Gordon Head of Studio at DEGEN Studios

DEGEN Studios unleashes the Plague City chase

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DEGEN Studios has launched Plague City, a Scatter Pays slot built around visible progression, escalating features and a 10,000x max win chase. Every winning combination spreads infection across the reels, creating bigger setups as players build towards Plague Wave Respins, Plague Breakout Free Spins and Super Free Spins.

During the base game, any position that forms part of a winning combination becomes infected, and as wins and cascades continue, the outbreak can spread across more of the reels.

A Med Kit should stop the outbreak. In Plague City, it starts the next stage. Landing a Med Kit while infected positions are active triggers Plague Wave Respins, where infected positions remain active, Wilds become sticky with multipliers, and Respins continue until every infected position has been healed or no further wins occur.

Every Sticky Wild begins with three lives. Each winning cascade reduces a Wild’s life by one, while every newly landed Wild increases the multiplier value of all active Wilds, allowing multiplier chains to continue growing throughout the feature.

The chase escalates further in Plague Breakout Free Spins. Triggered by four, five or six Scatters, every Free Spins feature begins with eight Free Spins. Scatter symbols are replaced by Vaccines, which award retriggers and upgrade the Starting Wild Multiplier, allowing future Wilds to land with increasingly higher multiplier values.

Land six Scatters and the outbreak reaches Super Free Spins, where every newly landed Wild increases the multiplier value of all active Wilds by +2x. From there, the max win chase becomes a race to collect Vaccines, extend the feature and continue landing new Wilds as multiplier chains grow towards 10,000x the bet.

For players looking to accelerate the chase, Buy Bonus and Activate options offer direct entry into Plague Breakout Free Spins, Mystery Buy, or boosted chances of triggering both Free Spins and Plague Wave Respins.

Danny Gordon, Head of Studio at DEGEN Studios, said: “At DEGEN, we’re obsessed with building gameplay that players can actually follow. In Plague City, every mechanic has a purpose. The infection spreads, Vaccines extend the feature, Wild multipliers continue growing and every step brings the max win chase closer.”

The post DEGEN Studios unleashes the Plague City chase appeared first on EE Gaming | Global iGaming & Tech Intelligence Hub.

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