Mr Green sets new profit high
International strategy and investment in new mobile products pays off as profit leaps 28% year-on-year
Mr Green recorded its best quarter to date in the three months to 31 March 2014 with profit soaring 28% year-on-year on the back of investment in international markets and mobile products.
The Scandinavian casino operator saw profit reach SEK23.4m (£2.1m) after total group revenues rose 42% year-on-year to SEK154.6m (£14m), and CEO Mikael Pawlo attributed this to its expansion strategy outside of its native Nordic markets.
“We are becoming increasingly international and dependence on individual markets is decreasing,” Pawlo said.
Mr Green’s revenue split between the Nordics and the rest of Europe is continuing to shift, with 54.5% of group revenue coming from Nordic markets during Q1 2014 as opposed to 68.2% in the corresponding period last year.
Investment in mobile products has also continued to pay off with the channel now accounting for 20.3% of total game win following the launch of a new mobile casino late last year, and Pawlo said the channel is now “beginning to gain real momentum”.
Marketing costs during the period rose 45% year-on-year to SEK62m (£5.6m), however at 40.3% of revenues remained in line with expectations.
However the number of active users fell sequentially with the operator attributing this to a reduction in the number of bonus campaigns and free gaming spins but added this led to a “higher quality in the player base”.
During the quarter the firm continued to invest in its product offering, wholly acquiring the female-oriented online casino Garbo.com and social casino venture Social Holdings that the group had previously helped launch.
Pawlo did however admit that neither venture is likely to be earnings accretive during 2014, and that Social Holdings could even have a negative impact on cash follow during its development.
“Whether this will also impact earnings depends on the progress of the project, given that there are discussions ongoing regarding a review of the project’s current costs and changing the strategic utilisation of the project to gain better leverage from it,” Pawlo said.