Q&A: Pontus Lindwall on UK regulation and a return to growth in the Nordics

Betsson Group’s share price shot up 13% last week after the operator reported a 31% uptick in Q3 revenue to all-time high levels of €162m (£146.4m).

A strong quarter for the Malta-based operator ended in the strategic decision to pull all but one of its brands out of the UK market, leaving just Rizk to fight for market share.

Below, Betsson AB CEO Pontus Lindwall shares his outlook on complex markets including the UK, Germany and the Netherlands.

EGR Intel: What were the key drivers of Betsson’s Q3 growth?

Pontus Lindwall (PL): It was a strong quarter in general because we grew in all markets and we grew in both casino and sportsbook. We saw strong uptake in the previous quarter on the casino side and we have managed to keep some of that uptake and it’s the first step of digitalisation that we will keep riding.

EGR Intel: How did you achieve growth again in the Nordics?

PL: We were struggling a bit in Sweden since the regulation and we’ve been working on the product to get it more competitive. The product has since performed well and we made quite a nice step forward on the product side with the launch of Jalla Casino, our first pay and play brand in Sweden. It has proved to be very popular in the market.

EGR Intel: Which markets are benefitting from land-based players migrating online due to Covid-19 closures?

PL: We have seen that across all markets, but the impact was greater where the land-based part of the business was booming before the pandemic. The number of active clients we have is proof that lots of players have moved online and the majority have decided to stay there because it’s a good product.

EGR Intel: You have reduced your focus on the UK. Why have you chosen the Rizk brand to go it alone in the market?

PL: The Rizk brand has good traction and we can run that brand with fewer people working on it due to the platform they are on. It will become more commercially effective for us. We had a lot of brands active in the market on three different platforms and that was not a strategic decision but rather a historical situation from acquisitions. Commercially it’s a very sensible decision to focus on one brand instead of a lot of brands.

EGR Intel: Why was one of your four UK operating licences under review?

PL: The Gambling Commission decided it should be under review. That is what happens to all operators in that market, it is a part of life if you are licensed there. We have been under review before and there is nothing strange about that.

EGR Intel: The long-term outlook section of the report issues a warning about increased regulation and betting duties. Which markets in particular are you concerned about?

PL: In general, I am not concerned about the future of online gambling, especially not for Betsson. It is actually the other way around because I am very optimistic. But we needed to inform the market that there are countries that will impose gaming taxes and that will have an impact on the figures. The Netherlands would be one example.

EGR Intel: How does Germany’s new regulation impact Betsson and are you interested in obtaining a licence there?

PL: One of Betsson’s strengths is that we have a very diversified geographic spread, which means that no market is so big it would have a material impact on total revenue and that also goes for Germany. Germany is a big country and a market we believe in. We will apply for a licence when the time comes. We expect a small negative impact from the regulations that have been imposed.