Bet-at-home marketing campaign sparks 4.8% revenue rise

Bet-at-home this morning announced a 4.8% increase in full-year gross betting and gaming revenue to €145.4m, on the strength of a major TV marketing campaign in Germany and Austria.

EBITDA rose by 7.4% to €35.5m, up from €33m in 2016, as a result of a sustained marketing push in regulated markets that increased the visibility of the brand.

In the absence of a major international football tournament this year, bet-at-home spent €42m on a large-scale TV campaign in Germany and Austria, which resulted in 4.8 million registered customers, an increase of approximately 200,000 on 2016.

Sports betting equated to 44% of 2017 revenue at €64.6m, while the operator’s gaming division made up the remaining 56% at €80.8m.

The growth rate in revenue is slow but was achieved despite EU measures on foreign betting companies that have prevented Bet-at-home from operating in Poland since July 2017.

Paul Leyland of Regulus Partners said: “A key reason for this lacklustre performance is the exit and blocking of Poland, which likely accounted for c. 10% of group revenue given the impact: comps will therefore be tough until the Poland exit is lapped in H2.

“However, even stripping out Poland, we estimate underlying growth to be a relatively unimpressive 10%” he added.

The firm told investors it expects betting and gaming revenue to reach €150m next year, with EBITDA of between €36m and €40m, assuming the regulatory and tax environment remains unchanged- a big assumption according to Regulus Partners: “Bet-at-home’s focus on Germany and Austria (including major TV campaigns in Q117, comprising much of the marketing budget) could become significant issues should Austria continue with its player funds reforms and Germany reintroduce a conservative Inter-State treaty (likely in our view).

“In this context, the fragility of a .com business lacking momentum and facing negative regulatory change could be graphically illustrated,” said Leyland.