Kindred Group plc - Interim Report January - June 2019 (Unaudited)

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Kindred Group

24 Jul, 2019, 05:51 GMT

Second quarter and first half year highlights

VALLETTA, Malta, July 24, 2019 /PRNewswire/ --

Gross winnings revenue amounted to GBP 226.2 (219.0) million for the second quarter of 2019, an increase of 3 per cent, and GBP 450.6 (426.8) million for the first half of 2019.

Underlying EBITDA for the second quarter of 2019 was GBP 30.5 (41.7) million, and GBP 61.1 (89.2) million for the first half of 2019.

Profit before tax for the second quarter of 2019 amounted to GBP 14.7 (28.9) million, and GBP 32.4 (62.5) million for the first half of 2019.

Profit after tax for the second quarter of 2019 amounted to GBP 12.5 (25.5) million, and GBP 27.6 (55.4) million for the first half of 2019.

Earnings per share for the second quarter of 2019 were GBP 0.055 (0.112) and GBP 0.122 (0.244) for the first half of 2019.

Number of active customers during the second quarter was 1,478,437 (1,550,508).

"Locally licensed revenue growth of 41 per cent year on year but tough EBITDA comparatives due to the 2018 World Cup and Swedish re-regulation"

"Despite very tough 2018 comparatives, which included the start of the World Cup, revenues grew 4 per cent in constant currency year on year with particularly strong growth in locally licensed markets. Of the Group's Gross winnings revenue, 59 per cent came from locally licensed markets which represented 41 per cent growth compared to the same quarter last year (growth of 19 per cent excluding Sweden). This focus on growth in locally licensed markets is very much part of our strategy and, as expected, has resulted in margin pressure from higher betting duties. During the second quarter of 2019, Gross winnings revenue from mobile grew by 11 per cent compared to the second quarter of last year and amounted to 77 per cent of our total Gross winnings revenue."

"As we have highlighted for a long time and as we saw in the first quarter of 2019, the new licensing regulation in Sweden has resulted in significant short-term margin pressure driven by higher betting duties but also higher marketing as we are investing for the longer term. In the Swedish market, we saw a significant improvement quarter on quarter, but EBITDA contribution was still down GBP 9.2 million when compared to the second quarter last year."

"Total marketing for the Group, as a percentage of Gross winnings revenue, came in at 29 per cent and was at its highest level since 2013 when compared to other second quarters in non-major football tournament years. We also continue to invest heavily in technology and other operating expenditure in order to drive our future growth. Whilst this may reduce profitability in the short term, we are confident that, as we have previously proven, this will drive future growth in Gross winnings revenue and profits, particularly in locally licensed markets. Other significant items affecting the quarter were the planned investments in the USA, both in marketing and operating expenses, that contributed GBP 1.6 million of negative EBITDA in the quarter."

"For the period 1 July to 22 July 2019, the daily average Gross winnings revenue in GBP was 7 per cent lower (8 per cent in constant currency) than the average daily Gross winnings revenue for the full third quarter last year," says Henrik Tjärnström, CEO of Kindred Group.

Today, Wednesday 24 July 2019, Kindred Group's CEO Henrik Tjärnström will host a presentation in English at Kindred's office at Regeringsgatan 25, in Stockholm at 9.00 CEST.

The presentation is also webcast live on www.kindredgroup.com/Q22019. For those who would like to participate in the telephone conference in connection with the presentation, the telephone numbers are UK: +44 33 3300 9266 or the USA: +1 833 823 0590.

The Kindred Group operates in locally-regulated markets through its gambling licences in the UK, Sweden, France, Belgium, Denmark, Germany (Schleswig-Holstein), Italy, Australia, Ireland, Romania, Estonia and New Jersey, as well as other markets internationally through its gambling licences in Malta and Gibraltar. The Kindred Group pays betting duties in all markets in accordance with applicable local laws.