Tipp24 revenues up for twelfth consecutive year
Total revenues up 37% for 2011 " CEO slams Länder's draft egaming proposals.
German operator Tipp24 has recorded its twelfth consecutive annual rise in revenues, and announced its intention to sell off its skill gaming business in order to fund further development of its B2B lottery arm.
Total revenues rose 37% to 139.3m for the year, contributing to significant growth in consolidated net profit, which leapt from 19.6m to 36.3m “ a year-on-year increase of 85%. This saw earnings before interest and tax rise 51.9% from 32.7m in 2010 to 51.9m for 2011.
This follows the company’s announcement in February that it expected to surpass its forecast for the year. It has predicted EBIT of at least 35m for 2012, based on revenues of around 130m for the twelve months, though this does not take into account expenses related to the re-establishment of its German operations.
The company revealed that it has relaunched its Lotto24 brand in the German market in order to take advantage of potential regulation, and is likely to be one of the 86 operators to have expressed an interest in Schleswig-Holstein, where it will be able to offer its online lottery services.
Tipp24 managing director Petra von Strombeck said: “Within the framework of the Schleswig-Holstein gaming laws, lottery players can conveniently submit their tickets online and round the clock via the www.lotto24.de website as of February.
We are convinced that we can successfully utilize the considerable opportunities which this market offers and establish a strong and distinctive brand with Lotto24.de,” she said.
The draft legislation submitted by Germany’s other 15 Länder has been condemned by the European Commission, criticising among other things the legislative red tape affecting online lottery operators, stating that restrictions must only be used to prevent addiction and crime.
Tipp24 CEO Dr Hans Cornehl supported the EC’s findings, commenting: “Using the risk of addiction to justify extensive bans for private lottery providers is no longer tenable. There is simply no such thing as lottery addiction – a fact which has since been confirmed in court.
“Moreover, it was neglected to notify the implementation laws of the 15 states which are still seeking to restrict our basic freedoms – thus making them inapplicable. It is high time that commercial lottery brokers were once again granted non-discriminatory market access in line with EU legislation,” Cornehl said.
The company will also focus on developing a B2B arm to supplement the company’s revenues, with Cornehl explaining: “Initial market feedback has strengthened our view that this is a promising international business for us in an attractive growth market for which we are excellently placed.”
As a result Tipp24 will sell its skill games business, which was described as being “unable to match the profitability of Tipp24’s core lottery brokerage business over the long term.”