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Interim Report for January-September 2019
[PR] Evolution released today its Interim Report for January-September 2019.
Third quarter of 2019 (Q3 2018)
- Operating revenues increased by 47% to EUR 94.7 million (64.3)
- EBITDA increased by 73% to EUR 48.5 million (28.0), corresponding to a margin of 51.2% (43.5)
- Profit for the period amounted to EUR 39.8 million (21.2)
- Earnings per share amounted to EUR 0.22 (0.12)
January-September 2019 (9M 2018)
- Operating revenues increased by 48% to EUR 259.8 million (175.2)
- EBITDA increased by 67% to EUR 127.1 million (76.1), corresponding to a margin of 48.9% (43.4)
- Profit for the period amounted to EUR 102.9 million (57.9)
- Earnings per share amounted to EUR 0.57 (0.32)
Events during the third quarter of 2019
- Positive effects from investments in games and studio capacity
- All geographic markets contribute to the high growth
- Pennsylvania Gaming Control Board license received
Comments from CEO Martin Carlesund:
I am very satisfied to report consistently strong results for the third quarter. Our investments in new games and studios are having an increasingly strong impact, which is reflected in both the high growth as well as stronger margins. We have also seen a further increased demand for Evolution’s products globally. In addition, we now see clearly that we are reaching completely new player types, who to a large extent are playing Live games for the first time. These new players are being converted from other game categories, such as slots, which is very encouraging to see. Through our expansion and construction of studio capacity, together with the 10 new games launched during the first half of 2019, we are also favourably positioned to take advantage of the growing general demand for Live.
Revenues in the third quarter amounted to EUR 94.7 million, an increase of 47 percent compared to last year. EBITDA amounted to EUR 48.5 million, with a margin of 51.2 percent. For the nine-month period, the EBITDA margin was 48.9 percent. Based on this outcome, we will end up slightly above the previously communicated margin range of 47-49 percent for the 2019 full year.
Evolution’s products experience high demand all over the world, which can be seen in our growth which is truly global. To increase the understanding of our geographical reach, starting in this report we will break down our revenues per region. We are growing together with our customers in all regions, with the highest growth in Asia and North America. We expect this development to continue and it reflects the operators’ focus on new growth markets. In some regulated markets in Europe, online casino has entered a more mature phase, but Live Casino as a vertical continues to grow its share of the total market.
As previously communicated, we continue to invest in additional studio capacity to meet the total demand for Live. Our all-new studio in Malta is now operational, and we are also continuing to expand our existing studios in both Georgia and New Jersey. In Georgia, we have now doubled the capacity since the launch of the studio in April 2018. By the end of the year, we will also have doubled the capacity in New Jersey in order to add more games from our portfolio and to allow additional space for dedicated customer environments. Currently, we offer 9 out of 21 game titles from our portfolio to operators in the state.
During the quarter, we received an Interactive Gaming Manufacturer licence from the Pennsylvania Gaming Control Board, which is a prerequisite to be able to offer our services in Pennsylvania. Based on our experience in New Jersey, we see great opportunities to attract both online operators and land-based casinos with our offering. Planning for the studio is in full swing with launch during 2020.
After the end of the quarter we have signed an agreement with Flutter Entertainment and its successful brands Paddy Power and Betfair. The deal is the result of a dialogue that has been going on for many years, and which has been intensified thanks to our latest innovations. We look forward to developing this partnership over time.
For us, 2019 has been a year of products and innovation. We have further strengthened our development capabilities and going forward, we will keep up the pace in the development of new games. Behind the scenes, the work to develop our core games while also expanding the Live vertical with new innovations is always ongoing. When we publish the 2019 year-end report in February, ICE 2020 will have just ended. As in previous years, our ambition is to pave the way for the entire industry by launching new ground-breaking products.
The absolute core of Evolution is built on innovation with a focus to meet the demand for Live and to constantly increase the gap to the competition. I have a confident view of what the future will bring.
Presentation for investors, analysts and the media
CEO Martin Carlesund and CFO Jacob Kaplan will present the report and answer questions on Thursday, 24 October 2019 at 09:00 a.m. CET via a telephone conference. The presentation will be in English and can also be followed online. Number for participation by telephone: +46 8 566 42 705 / +44 3333 00 90 30 / +1 833 526 8397. Follow the presentation at https://tv.streamfabriken.com/evolution-gaming-group-q3-2019
For further information, please contact CFO Jacob Kaplan, +46 708 62 33 94, email@example.com.
For the full report, please go to https://www.evolutiongaming.com/reports.