The acquisition of SKS365 has boosted Lottomatica's strong performance in the online sector for the first half of the year, with group revenue increasing by 13.6% to 931.8 million euros.
In the six months ending June 30, 2024, revenue growth declined, with online revenue increasing by 37% to 338.3 million euros, as full-channel operator SKS365 was included in Lottomatica's performance starting May 1.
This acquisition, valued at 639 million euros, was completed in July, adding the online brand PlanetWin365, B2B payment business PlanetPlay365, and a retail business of 1,000 sports betting outlets to Lottomatica's operations.
Lottomatica: We are the leaders in the Italian online market
CEO Guglielmo Angelozzi stated, "We have successfully completed the acquisition of SKS and are rapidly advancing integration, having already realized about 40% of the announced synergies."
Thanks to PlanetWin365, Goldbet, Lottomatica.it, and Betflag, the operator now holds 29.1% of the Italian online gambling market. Lottomatica states that this distinguishes it as the undisputed market leader.
This means that online gambling revenue is nearing to surpass the operator's gambling department. The operator's live gambling revenue from the Amusement With Prizes (AWP) and Video Lottery Terminals (VLT) network reached 379.8 million euros in the first half of the year, with a slight year-on-year increase.
An additional 213.7 million euros came from sports betting, including Better, GoldBet, Intralot, and PlanetWin365 betting stations and kiosks. Lottomatica reports that performance improved in the three months ending June 30, helping this vertical recover from a weak first quarter.
Business expansion erodes Lottomatica's profits
The adjusted EBITDA increased by 6% year-on-year to 317.3 million euros, with a profit margin of 34.1%. Lottomatica states that higher sports betting expenses in the first quarter, combined with the lower profit margin integration of SKS365, led to a decrease in profit margins for the first half of the year.
This acquisition also led to increased costs, resulting in a pre-tax profit decrease of 18.4% and a net profit decrease of 36.6% to 23.7 million euros.
However, the adjusted net profit, plus non-recurring costs and amortization of high-value assets, reached 105.3 million euros, although this still represents a 13.1% decrease from the same period last year.
Lottomatica raises full-year performance expectations
However, as the integration of SKS365 is progressing faster than expected, Lottomatica has raised its full-year revenue expectations to between 2.03 billion euros and 2.08 billion euros, higher than the previous expectations of 2.02 billion euros to 2.07 billion euros.
The adjusted EBITDA is now expected to be between 700 million euros and 730 million euros, higher than the 680 million euros to 700 million euros previously expected.
