Zeal Network reports double-digit increase in profit
The German lottery provider has seen profit rise by 12.3 per cent for the first nine months of 2021.
Germany.- The lottery provider Zeal Network has reported revenue of €65.1m for the nine months ending September 30.
That’s an increase of 0.9 per cent year-on-year and was achieved despite lower jackpots than in 2020. It comes through the company cutting costs and personnel expenses by 12.7 per cent to €14.5m and other operating expenses by 22.7 per cent to €33.2m.
EBITDA was up 155.7 per cent to €17.6m and earnings before tax and interest were up 286.7 per cent to €11.1m. Net profit for the nine months was up 12.3 per cent year-on-year €7.3m.
German lottery business
The main German business contributed the vast majority of revenue (€61.5m). It saw revenue rise 5.3 per cent year-on-year despite the Eurojackpot lottery jackpot passing €90m only three times, compared to six in 2020.
Germany’s Lotto 6aus49 has also failed to reach jackpot levels seen last year.
While this had a negative effect on new customer acquisition, Zeal still managed to pick up 446,000 new registered customers in Germany in the first three quarters.
In the period reported, Zeal Network made an offer for the remaining shares in online lottery broker Lotto24, which it spun off in 2012. Lotto24 delisted its remaining shares from the Frankfurt Stock Exchange and Zeal now owns around 94.9 per cent of the broker’s share capital.
Zeal’s chief financial officer, Jonas Mattsson, said: “The fact that we have managed to continue to grow with a significantly weaker jackpot development compared to the previous year and at the same time significantly improve profitability makes us proud.
“It furthermore demonstrates that we have taken the right measures by adjusting marketing investments and implementing strong cost discipline to match the market reality.
“The scalability of our business model will also help us in the future to take advantage of market opportunities, adapt to the dynamic environment and continuously optimise.”
For full-year 2020, Zeal beat its profit estimates.
