Red Tigers Best Ever Q3 Drives NetEnt Forward

Published: 23rd October 2020
Author: Joe Kizlauskas
Last Updated: 14th December 2021

The revenue outlook for NetEnt for the final quarter of the year remains optimistic as the company recognises Red Tiger ‘s best ever quarter and continued success in the US as key performance drivers for Q3.

The company also reports that the return of sports betting and the general easing of lockdowns in key markets resulted in sales growth normalising to pre-COVID-19 levels.

As Gonzo ‘s Quest Megaways became the best-performing new game ever released for the NetEnt Community in terms of gross gaming revenues, US GGR increased 313 percent to account for more than 10 percent of the total GGR community and continued live casino improvements saw its figures grow 109 percent year-on-year.

Therese Hillman, group CEO of NetEnt said: “During the quarter we continued to invest in our strategic growth areas USA, Red Tiger and live casino, while driving cost and revenue synergies from the ongoing integration between NetEnt and Red Tiger.”

Revenue for the quarter rose by 17.6 percent from SEK 521 million (2019: SEK 443 million), as EBITDA grew by 58.16% from SEK 196 million to SEK 310 million, as profit for the period reached SEK 167.1 million (2019: SEK 76 million).

Revenue came in at 1.61bn for the year ending September 30, 2020, up 25.7 percent from SEK 1.28bn, EBITDA rose 41 percent from SEK 594 m to SEK 838 m, and profit for the year ended up at SEK 337.5 from SEK 316.1 m a year earlier.

Hillman remarked: “On a proforma basis, including Red Tiger fully in the previous year’s figures, the group’s total revenues increased organically by nine per cent Y/Y in euro compared to the same period in 2019. The return of sports betting and the general easing of lockdowns in key markets resulted in a normalisation of revenue growth to pre COVID-19 levels.

“Our continued focus on costs started to have a notably positive effect on profitability in the quarter. Underlying earnings before interest, tax, depreciation and amortization (EBITDA) amounted to SEK 313m (2019: 221m), corresponding to a record margin of 60 per cent (50 percent).”

Looking at the time ahead, NetEnt indicates that during the final quarter, a range of actions taken will yield benefits, including continued US momentum in West Virginia, Michigan and Pennsylvania, a link-up with Veikkaus and further expansion of the Malta-based live studio of the group.

Hillman added: “The revenue outlook for Q4 remains positive, supported by the list of actions mentioned above. Further, our product pipeline looks very promising with Megaways versions of such classic titles as Kulta Jaska, Twin Spin and Divine Fortune.

“Given our new lower cost base, the operating leverage of our business and our strong product pipeline, we expect continued strong growth in earnings and cash flow for the rest of the year and beyond.”

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About Joe Kizlauskas

Joe is a seasoned iGaming copywriter and speaker who has been in the business since 2015. He's written more words on all elements of iGaming than he likes to remember, and he's contributed material to a number of well-known brands. Joe may be seen playing 5 a side, at the gym or playing games on his Playstation when he is not writing.