Betsson CEO on Dutch licensing and Swedish challenges

Betsson Group today revealed a 5% year-on-year drop in gaming revenues for Q2 2019, citing the impact of regulation in Sweden and operational adjustments in its Dutch businesses in preparation for Dutch licensing and regulation.

As part of these Dutch adjustments the operator was forced to rebrand its Oranje Casino and Kroon Casino sites and make other changes to stop targeting Dutch consumers. Betsson Group CEO Pontus Lindwall chats to EGR Intel about the challenges of both markets and how he expects the turbulence encountered by the business to subside over the coming months.

EGR Intel: Were there any surprises in the results for the quarter?

Pontus Lindwall (PL): Not at all. There were no surprises and these results were totally in line with our expectations. Revenues are, of course, lower than the same period last year, but that’s due to changes in Sweden and the Swedish regulatory environment. Another factor to consider is the adjustments we’ve had to make in the Netherlands market to ensure our compliance with the regulations set down by the KSA.

EGR Intel: In the report you cited challenges in several key markets, including Sweden and Norway. What is Betsson doing to ensure these challenging markets do not adversely affect revenues going forward?

PL: As stated previously, the main impacts on our revenues have come from Sweden and the Netherlands, dips which have since stabilised. We will continue to work on those markets, but we don’t expect any further drops in revenues from those markets going forward. In Sweden, the downward shift in revenues was due to the impact of taxation, something which is totally normal and in the case of the Netherlands, we caused the downward shift in revenues by making those necessary changes to our business.

EGR Intel: You’ve mentioned the operational adjustments made to the business in the Netherlands. Now that the KSA has released its licensing standards and clearly defined the so-called cooling off period, how confident are you that the business will obtain a licence quickly?

PL: I believe the operational adjustments we’ve made have put us in a really good position to obtain a licence as soon as possible. Looking ahead, once we’re licensed I’m sure it will be a good market for us and there’s a lot of interest in the market from quite a broad spectrum of different operators. In that regard, it’s probably fair to say that we can expect quite a crowded market, as we saw in Sweden for example, so it’s good that we have a good market share from the start.

EGR Intel: Sportsbook revenues are clearly a key driver for overall group revenues going forward, how are you planning to ensure that the positive revenues from sportsbook continues?

PL:  Over the past few years, we have built a really strong team for the sportsbook and in sportsbook development. We’ve managed to raise the quality of the sportsbook product from a technical perspective, so that it’s a solid and stable product. Once we had that in place, we also started to broaden the customer offering, the markets we offered and adding certain functionality to the product. Given the positive work we’ve conducted on the sportsbook offering to date, I’m confident that we have everything in place to continue this trend going forward.

EGR Intel: Betsson has applied for a licence in Buenos Aires, if you are successful in obtaining a licence, do you believe this expansion can serve as a catalyst for further expansion into Latin America?

PL: Well as you’ve said, we’re in the middle of that process right now. We’ve looked extensively at the market and it looks promising and I think we’ve proved that we can operate successfully in that corner of the world so that would be a new opportunity for us.

EGR Intel: Betsson is appealing its SEK19m fine levied by the Swedish Gambling Authority against your NGG Nordic Ltd subsidiary for bonusing violations, do you believe that the company will win the appeal?

PL: It’s hard to tell. Obviously, we have a different opinion than the SGA on this topic, so we will see what the court has to say about it. We believe we have been acting within the regulation, so we don’t believe we should be fined and that’s why we are challenging the decision.

EGR Intel: You have completed the roll-out of the OBG platform on the core Betsson brands of Betsson, Betsafe and Nordicbet. Do you plan to expand the roll-out to cover your other brands?

PL: Given the successful roll-out on our core brands, I’m sure we want to launch it on our remaining offerings. I don’t have the precise roadmap in front of me, so I can’t really confirm timescales, but it has been received very positively by our clients and there is a definite interest in launching it on other sites as well.