Enlabs’ Q2 revenue falls 35% as Latvia’s two-month market suspension bites
Net profit tumbles 39% during turbulent quarter but operator points to stabilisation of regulatory landscape in Baltics following coronavirus-related restrictions
Enlabs has reported a 35% year-on-year fall in revenue for Q2 to €6.1m (£5.4m), with the Latvian parliament’s suspension of all licences from 8 April to 10 June with the coronavirus-enforced lockdown partly to blame.
As for the first six months of 2020, revenue slid 10% at the Nasdaq-listed operator from the €18.4m generated in the previous year to €16.6m.
Meanwhile, EBITDA in H1 came in at €3.24m – a 38% decrease on H1 2019 – and EBITDA margin was 19.5%. Enlabs recorded EBIT of €1.93m, down from €4.33m in the corresponding period last year.
Net profit for the first half of the year was €2.64m, which was a 39% decline YoY from the €4.33m achieved in H1 2019.
Furthermore, total deposits for the Nordic- and Baltic-focused operator in H1 amounted to €54.4m, while there were more than 56,000 active customers – a rise of 14% over H1 last year.
The 15-year-old operator said the business had demonstrated its “ability to adapt and evolve” during Q2, with retail operations disrupted in Lithuania for most of the quarter besides not being able to operate online for two months in Latvia.
Enlabs, which is behind the Optibet brand, said the regulatory landscape has “stabilised” in all three Baltic countries with their Covid-19-related restrictions lifted and that all its brands and retail betting shops were fully operational.
During Q2, the operator highlighted how it acquired a 29.9% stake in Global Gaming for £7.7m, launched new brand Laimz in Latvia, introduced esports betting, and joined Playtech’s iPoker network.
In July, consolidated gaming revenue was up 11% YoY and the business was “back on a strong momentum”, said CEO and group president George Ustinov. Casino was said to be driving this growth.
“Considering the market recovery in June, the return of sports activity, and our packed roadmap going forward, we are looking toward growth in Q3,” he added.
In Q3, the Optibet brand was launched in Latin America. When discussing the foray, Ustinov said it was still very early but that he didn’t expect to be “booming”; the target instead would be to “grow steadily and profitably” in the region.
Reflecting on a challenging and turbulent Q2 and looking towards Q3’s early momentum, Ustinov told investors via videoconference: “The sun always shines after the storm.” Enlabs shares were down 1.9% in early trading.