Kindred Group plc - Interim report January - September 2020 (unaudited)

Kindred Group plc - Interim report January - September 2020 (unaudited)

PR Newswire

STOCKHOLM, Nov. 6, 2020

STOCKHOLM, Nov. 6, 2020 /PRNewswire/ --

Third Quarter 2020           

January - September 2020           

CEO comment

"Strong growth in regulated markets combined with continued cost focus resulted in a strong quarter"

Reflecting on the past six months, it is evident that societies across the world continue to struggle as a result of the COVID-19 pandemic. Despite these challenges, and thanks to our diverse business model, I am pleased that we can report sustained momentum across our markets with Gross winnings revenue of GBP 280.7 million, a 24 per cent increase compared to the same period last year, and an all-time high in active customers.

Strong sportsbook activity

The finalisation of the previous season's sports leagues combined with the start of the new season resulted in a strong sportsbook activity, albeit with a slightly lower sportsbook margin of just over 8 per cent for the quarter. It is also promising that the strong activity levels for other products have sustained. With the return of major sports leagues across the world, and the ongoing shift from offline to online, our active customer base grew by 19 per cent compared to the same period last year. Other contributing factors are the great efforts made to enhance customer experience and high customer satisfaction scores, both important as we expand our locally regulated footprint.

Locally regulated markets contributed to strong growth

During the quarter, 61 per cent of our revenues were derived from locally regulated markets. Entering these markets often has a short-term negative impact on our business, but we know that, if managed well, this is temporary and that profitability will be restored over time. During the quarter, our locally regulated markets achieved annual growth in Gross winnings revenue of 31 per cent, which I am extremely pleased about. Our continued focus on costs resulted in a total Group underlying EBITDA of GBP 74.6 million for the quarter. Due to the return of sports, marketing levels were relatively low at the beginning of the quarter but returned to slightly below the long-term average towards the second half of the quarter.

Encouraging developments in the US

The US is a key investment market where our team have been working hard to go live in our third state, Indiana, during the quarter. We are now pushing forward to launch in Illinois and Iowa in 2021, along with more states in the pipeline. It is encouraging to see the continued strong growth in the US, with the market share in Pennsylvania reaching above 5 per cent during the third quarter. With New Jersey and Indiana also growing steadily, I expect the US to become one of Kindred's largest markets during the next couple of years. As with all market entries, the initial investment phase is focused on building our customer base and, as a result, the US market has seen revenue negatively impacted by big bonus campaigns during the second half of the quarter, but still grew 22 per cent sequentially.

Our dedicated team continue to make a difference

Throughout the quarter we have continued to launch several exciting initiatives relating to our sustainability activities, and just recently hosted the Sustainable Gambling Conference online with almost 700 registered attendees. As an organisation we continue to endure the pandemic and our dedicated teams are doing a terrific job as they run the business from their homes. The ability of the entire Kindred team to adapt to these new circumstances, and turn it into a strength, demonstrates our progressive attitude as a company. I am both proud and pleased to see how well we have all managed to deal with this difficult situation.

Trading update

For the period 1 October to 3 November 2020 average Gross winnings revenue in GBP was 42 per cent higher (38 per cent in constant currency) and active customers was 18 per cent higher than for the same period last year. We saw continued strong activity in sportsbook and casino and the sports betting margin was approximately 2 percentage points higher than in 2019.

Henrik Tjärnström CEO of Kindred Group

Today, Friday 6 November 2020, Kindred Group's CEO Henrik Tjärnström will host a web cast in English at 09.00 CET on www.kindredgroup.com/Q32020. For those who would like to participate in the telephone conference in connection with the presentation, the telephone numbers are UK: +44 33 3300 9272 or in the USA: +1833 249 8407.

This disclosure contains information that Kindred Group is obliged to make public pursuant to the EU Market Abuse Regulation (EU nr 596/2014). The information was submitted for publication, through the agency of the contact person, on 06-11-2020 07:30 CET.

For further information please contact:

Inga Lundberg, Investor Relations   +44 788 799 6116

This information was brought to you by Cision http://news.cision.com

https://news.cision.com/kindred-group/r/kindred-group-plc--interim-report-january---september-2020--unaudited-,c3232421

The following files are available for download:

https://mb.cision.com/Main/824/3232421/1331409.pdf

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