STS to cease UK and Estonia operations amid record Q4 results
Polish operator to focus more on its native market after posting a 17% year-on-year increase in NGR for 2022
STS has announced it will be phasing out activities in the UK and Estonia as it looks to focus on the Polish market and increase profitability.
The Polish operator announced the shift in strategy as part of its Q4 and full-year 2022 earnings report.
STS officially entered the UK market in December 2019 when it was awarded a licence by the UK Gambling Commission. Prior to the licence award, STS was operating for 10 months in the UK as a white-label brand.
Explaining the rationale behind the decision to pull the brand, STS said: “In 2023, the group is planning a number of activities aimed at increasing the profitability of its operations. To this end, the company is reorganising its operations, focusing on Poland and phasing out its activities under licenses in the UK and Estonia.
“The company intends to concentrate its activities in order to be able to use the development potential in the country.”
Mateusz Juroszek, STS CEO, said: “Operating data for last year clearly shows that the domestic [Polish] market is in a growth phase, despite the extremely difficult macroeconomic environment, the war in Ukraine, high inflation and economic stagnation.
“Therefore, we intend to use this potential as fully as possible and continue to strengthen our leading position in the country. For this purpose, since the beginning of this year, we have been focusing our activity exclusively on Poland,” Juroszek added.
Juroszek went on to emphasise the importance of the Polish market as the key driver of growth for the business in 2023.
He said: “Our goal for the difficult year is greater efficiency of operations and a number of implemented savings. The new agreement with Polish Football Association, focus on the Polish market and a number of synergies resulting from changes in the structure of the group will positively affect our profitability and facilitate further EBITDA growth.”
STS’s decision to leave the UK follows a number of operators shuttering UK operations as the impending white paper review into the Gambling Act 2005 sees operators looking at other markets as their main focus.
Most recently, Mansion Group closed its three UK casino brands as it looks to focus on improving its online casino offerings in other licensed markets, including Ontario and Spain.
Last year, the likes of SportNation, RedZone, bet-at-home, Genesis Global and Novibet also exited the UK market.
Elsewhere, STS posted net gaming revenue (NGR) of PLN663m (£125.12m) in 2022, a 17% year-on-year increase for the operator.
The Warsaw-headquartered firm also noted that the number of active users had jumped 13% from 693,000 to 783,000, with the number of new customers increasing 18.6% from 370,000 in 2021 to 439,000.
The group’s adjusted EBITDA preliminary estimates are between PLN265m and PLN275m for 2022.
The operator also recorded its highest NGR in a quarter in Q4, posting PLN200m compared to PLN136m in Q4 2021.
On the firm’s performance in 2022 and on Q4 specifically, Juroszek said: “In line with our earlier announcements, Q4 2022 turned out to be record-breaking. The calendar of sports events and the World Cup held in Qatar contributed to high customer activity.
“Our offer attracted as many as 200,000 new players in the last three months of the year. During the World Cup alone, we had nearly 500,000 active customers.”