European lottery leader Allwyn Entertainment has posted a dramatic year-on-year increase in consolidated revenue for the first quarter, up 80% year-on-year, thanks in no small part to its recent acquisition of well-known British lottery brand Camelot.
80% is more precisely 81.4% and represents the total of 1.58 billion euros, although the company’s UK results fell by almost 2% to 1.01 billion euros.
Explaining the rapid increase in numbers, the company said in a statement: “During the first quarter of 2023, we completed the acquisitions of Camelot UK, current operator of the UK National Lottery, and Camelot LS Group, current operator of the Illinois Lottery, under a private management agreement. These acquisitions have a significant impact on the Group’s consolidated metrics and comparability to prior periods.”
Most markets rise
Most markets were in favor of the provider, with Italy slipping just a meager 0.6%, while Greece and Cyprus combined saw a 14.6% rise to €552.9m, with Austria contributing €388.4m ( +19.3%) and home to the Czech Republic The base produced 125.4 million euros, an increase of 17.2%.
The CEO of Allwyn, Robert Chvatal commented: “I am pleased to report that Allwyn had a strong start to the year, reflecting our continued focus on driving organic growth as well as continued progress on our inorganic growth strategy. First quarter results include contribution from a total of seven lottery markets.” . In the meantime, we have remained focused on our responsibilities to all of our stakeholders and safer play.”
The boss summed up the tremendous sales growth by explaining that 17% came from existing geographic markets, as well as first-time contributions from the UK market. The purchase of Camelot included not only Camelot UK but also Camelot LS Group. The latter runs the major US lottery in Illinois under a private management agreement.
He explained how the success of the existing market was further fueled by digital channels as well as physical retail sales and how the receding of some Covid-19 impacts over the past year has no longer impacted current sales.
“We have once again seen the resilience of demand for our products, even in an environment where consumer spending remains under pressure. We continue to deliver strong margins and generate strong free cash flow, reflecting our favorable cost structure and our focus on capital and cost efficiency. The completion of two landmark acquisitions in the first quarter underscores our continued success in executing our inorganic growth strategy. The acquisition of Camelot UK, the current operator of the UK National Lottery, supports the successful implementation of the National Lottery into 2023 and into the next decade.”
Camelot LS was owned by the Ontario Teachers Pension Plan Board of Canada before the Allwyn takeover. In early December 2021, the Czech gaming conglomerate, then known as Sazka Entertainment, began conducting business under the Allwyn corporate identity for all of its real estate assets when it changed the name “preferred bidder” for the fourth UK National Lottery licence.
In a short space of time, the formerly Czech Republic-based company (now headquartered in Switzerland) has expanded into new markets worldwide, including the US with the Illinois Lottery, its first foray into the US lottery landscape, which was once entirely owned by Scientific Games and dominated by GTECH/Lottomatica (now IGT through acquisition).
Chvatal explained the importance of expanding lottery business into such markets: “
Regarding financial transactions, he remarked: “The continued strength of our financial performance supported our successful funding activities after the end of the quarter, with Allwyn issuing €665 million and US$700 million of long-term debt in a single transaction. This financing represented our first US dollar bond issue, further diversifying our funding sources, significantly extending our debt maturities and further simplifying our capital structure.”
Concluding, Chvatal said he was very pleased with the start of 2023, saying that this put the company in a good position to continue the success for the rest of the year and “the next chapters in our growth story.”
Spring: Allwyn Entertainment reports an 80 percent jump in sales with the addition of CamelotG3 NewsWire, June 15, 2023
