Increased investment impacts bet-at-home bottom line
Annual net income down 43% despite significant rise in gross gaming revenue.
Increased investment in advertising has boosted Betclic Everest Group subsidiary bet-at-home’s gross gaming revenues but has impacted significantly on the company’s bottom line figures, the operator has announced in its results for the three months ending 31 March 2012.
The German-facing brand saw advertising spend rise 39.3% year-on-year in the first quarter of 2012, up to 11.09m, which the company claims has led to a “considerable rise” in its customer base ahead of this summer’s Euro 2012 Football Championships.
Coupled with the reactivation of existing players, the operator now has over 2.8m registered customers. This follows increased spend in the fourth quarter of 2011, where advertising expenses rose 49.5% as part of the company’s commitment to growing the brand.
This was reflected by betting and gaming turnover, grew 23.5% for the period, up from 427.19m to 527.68m. Gross gaming revenue also increased from 18.29m to 21.11 “ up 15.4% – with net gaming revenue up a similar amount, rising 15.9% to 18.85m for the quarter.
However, the increased spend failed to filter through to the company’s bottom line. EBITDA for Q1 fell significantly, down by almost 50% year-on-year from 3.84m to 1.94m, while earnings before tax dropped 46% to 2.1m. This led to a decline in annual net income, which fell 43% from 2.51m to 1.43m.
Bet-at-home is thought to be one of the operators to have applied for an operating licence in the German state of Schleswig-Holstein, which announced the award of its first three egaming licences last week. It has also agreed a sponsorship deal with marketing agency Kentaro for the German national football team’s upcoming qualification campaign for the 2014 World Cup, with bet-at-home branding appearing on electronic advertising boards in all away games.