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A daily podcast delving into the biggest stories of the day throughout the sports betting and igaming sector.
Charlie Horner (00:01.728)
Welcome back to iGaming Daily, supported by Optimove, the creator of positionless marketing and the number one player engagement solution for sports betting and iGaming operators. Today I I'm delighted to be joined by Betson CEO Pontus Lindwall, just after the company published its Q two and H one results. Pontus, thanks ever so much for coming on. How are you doing?
Pontus (00:24.85)
Yeah good, thank you very much.
Charlie Horner (00:27.564)
No, not a problem. It's great to have you on the show. And we'll we'll have a a full piece of coverage on SBC News of those results. But just as a quick overview of some of the numbers, group revenue at five hundred and ninety-five and a half million euros, an organic increase of of five percent. Ebit DAR at one hundred and eight point four million euros, that's a decrease of thirty three percent, and operating income at seventy six point two million euros.
First of all, Pontus, revenue is at a all time high. I think that's driven by the B to C side of the business. Could you outline what the strategy has been to get to this point and and maybe has the opening stages of of the World Cup helped to contribute to to that milestone?
Pontus (01:14.344)
Yeah, the B2C part of our business, which is obviously the largest part and where we own the brands and we run the whole operation. It has been growing for a very long time and it's been going well now in this second quarter of the year as well. And of course, boosted a bit by the
end of the quarter by the championship. But then again, we have to remember that it was only around 20 days of the championship in that quarter. So it helps a bit, but it's not what makes the difference really for the results. It's the long term job that we do within all our B2C business that has made this possible.
Charlie Horner (02:08.066)
Sure, yeah, I I'm sure that the the World Cup or particularly those opening stages of of of the tournament is more of a an acquisition period rather than where you actually sort of generate your your big results. So I guess it's testament to the operational side of the business that that you have managed to get those sort of all time high revenues during this this quarter. Latin America now is Betson's largest region and there are also record revenues in in that region. we've spoken about it a little bit before as well, but
What what was the strategic decision making process to to sort of focus heavily on Latam? A and secondly, what is it about your products and brands that resonates with players so much in that region?
Pontus (02:50.886)
I think we started off in Latam a very long time ago and I can say that from the very first day of that I didn't state that it should become our largest region but we have been doing well over there. Thanks a lot to our local teams over there and I think that is one of the keys to our success that we have always been local in the market.
or in the different markets over there because they are different between themselves as well. But after being there for quite some time, actually, we saw that we had good traction and we decided to invest more. And we have been early in the market. And with the fact that we had
people on the ground and local knowledge we managed to keep the traction also going into new markets that was regulating in Latam. So it's a very important region for us and now it's the region where we put the most of our efforts into.
Charlie Horner (04:01.335)
Sure, no, it's it's nice to to hear the the sort of colour on that. But what what which markets specifically in Latama are the ones that are sort of driving the best results for for Betson?
Pontus (04:10.92)
I would say we are in many markets there, but I would say that Argentina and Peru are two large markets. And very interesting now when we have Argentina in the final of the World Cup. It's going to be very interesting to see.
Charlie Horner (04:30.155)
It's still a sore point, Pontus. I'm sure my co host Fur will will be much more happy with that. But yeah, it's nice to nice to see that yeah, Argentina is contributing so heavily to to the business there. just moving on slightly from from Latam and and going to Western Europe, that's another region where Betson is is seeing revenue growth. and that's despite a lot of
what we would say regulatory pressure in in the region as well and and tax pressures. H how much of an opportunity do you see in Western Europe as that landscape continues to shift and and other operators sort of look at mitigation measures in in that region? Do you see a real opportunity to sort of put the the foot down on on the gas?
Pontus (05:16.252)
Yeah, mean, Europe is a fragmented market. There are some countries that are very hard to digest and very hard to work in because of regulatory measures and let's say over regulation, I would say too much.
constraints on the product and what we can offer. And then there are other markets which are more optimistic and more opened up. these are the markets where we put our efforts and this is where we put our marketing money, Italy being such one market where we are growing strongly both in casino and sports book.
Charlie Horner (06:04.363)
Mm. And that's obviously the the market where you have the the big partnership with Inter Inter Milan as well, which is it must be a a great deal for for Betson to get that exposure in that market. And is that s is that a reflection of maybe the regulatory system in Italy being more favourable than other markets in in Western Europe?
Pontus (06:24.796)
Yeah, I wouldn't say that the system in Italy is particularly favorable because it's not easy either. But on the other end of the spectrum, are several markets where it's more or less not feasible to try to do something. And that's a sad part of the Western Europe story.
Charlie Horner (06:47.775)
Mm-hmm. Yeah, yeah, absolutely. It's something that we've we covered a lot on on this show is that while while they are sort of mature markets and there's a lot of appetite for these products, yeah, the the over regulation is sort of hampering what what businesses can do there. another I I want to sort of turn our attention now to two markets where revenues have have declined and that's
in the Nordics and the Central and Eastern Europe and Central Asia regions. they're down seventeen point one percent and fourteen point nine percent respectively. Just wanted to ask what you think is sort of causing the downturns in in those re regions and sort of how you've mit mitigated for those declines.
Pontus (07:29.32)
If we start with the Nordics, then it's just because we don't put the same focus there in terms of marketing investments. We are here, we have presence, we have quite strong positions in the market, but we don't invest much because the return on investment is less good here than what we see from Latin America.
as an example. the same as Seca is a different story because there we have a few markets where we do really well. But that one is, it's more an imbalance between different geographical markets over there.
Charlie Horner (08:16.023)
Sure, sure. just on the on the Nordics, you said you you just don't invest as heavily as in that region as as other regions. I I think in in the report it says it's more on the casino side where the activity has declined. I are you seeing that's because again, because of sort of the regulatory environment in in those countries and and sort of channelization rates sort of decline as as as a result?
Pontus (08:42.696)
That's a big part of the situation there and the problem that there is a tough competition between the licensed operators and the operators who are not locally regulated. And that makes it very hard for us to kind of, you know, get the revenues that we would need from our customers to
to invest more and grow. It's possible, but it doesn't leave much money on the bottom line.
Charlie Horner (09:20.759)
Sure, sure, absolutely. Pontus, we'll take a very quick break and we'll come back and we'll continue our discussion.
Pontus (09:28.006)
Thank you.
Charlie Horner (09:30.549)
Welcome back to iGaming Daily. I'm joined by Betson CEO Pontus Lindwell. Pontus, despite the record revenues a and the all-time high records, the all-time high revenues, eBit DA and profitability have taken a little bit of a hit. On the B2C side of the business, do you think this is due to the sort of increased mix of locally regulated markets and the the
s subsequent taxes. are there sort of other factors at play?
Pontus (10:02.632)
I think actually that the main impact on the decrease that we see compared to the same quarter last year is a loss of revenues on the B2B side. Those revenues are very profitable and we have one B2B client which is pretty big and who lost some traction there.
by the end of last year and in the first quarter this year. That has stabilized. But the increase that we see now in profitability comes from the B2C side more. So that's as we see growth on the B2C side, we saw 14 % growth in this quarter. That means a lot for the bottom line on the B2C side.
Charlie Horner (10:55.093)
Sure, and I guess that's underlined by the fact that marketing spend is up, so you you have some sort of confidence in in that P to C side of the business that you can sort of put the foot on the pedal and and go for the marketing spend a bit more.
Pontus (11:07.356)
Yeah, exactly. And now we see revenues are up on the B2C side and it's actually so that the marketing spend that we do on the B2C side, it's quite, you know, it's not a fixed but not far away from a fixed part or share of the revenues. So we don't change that much quarter to quarter. So when we see this kind of traction, then we keep on investing.
Charlie Horner (11:38.199)
Sure. you you mentioned the B2B side of of the business just just before as well. and you mentioned that it was s the decline in revenue was sort of driven by w one particular party. but are you seeing that maybe some of the increased regulatory pressure and tax hikes across different markets is sort of cooling the B2B sector in in gambling?
Or or do you think there are other contributing factors or d is it just a a a sort of individual case?
Pontus (12:10.696)
This is more an individual case. think our B2B customers in general, face the same day-to-day life as we do with increased taxes and regulations and everything. So they are in a similar position, but they struggle on anyways.
Charlie Horner (12:32.862)
Absolutely. look I I just wanted to talk a little bit more about the World Cup and I know that it was you know, just one part of of a much wider quarter. but of course the World Cup results are gonna keep streaming into Q three results as well. how much activity have you seen on on the Betson sort of sports book platform throughout the tournament and how much of a boost are you expecting it to to give you? I I guess
it's more f from a customer acquisition point of view, but how do you go about retaining those customers as well?
Pontus (13:07.496)
Yes, it's more from a customer acquisition point than actually revenue for the company. But we've seen great activity and now we look forward to the bronze final and the final. And we believe it's going to be two really heated
games. that will be very interesting to see. So yeah, it's a big activity that we have seen and of course the biggest impact is actually on new customer acquisitions. So now it's up to us after the tournament to start to engage with those customers and see if we can keep them as playing customers for
the times to come.
Charlie Horner (14:03.734)
Sure, that's the that's the big challenge for for all operators now. H what is what is the strategy to sort of hold on to those to those customers?
Pontus (14:12.144)
Yeah, exactly. That's what we have to do. We have to find out what kind of games they like. Obviously, if they came in for the World Cup, there's going to be no more World Cup thereafter this weekend. So we have to find something else that we can attract them with.
Charlie Horner (14:26.764)
Mm-hmm. Sure. I just just one more question on the World Cup. because before the tournament there a lot was made about the 48 teams, the 104 games, and that driving more bets ultimately. but there were concerns about sort of the competitive balance and and some of the the smaller teams. How how do you assess how the World Cup sort of planned out in terms of, you know, we had great storylines like Cape Verde and
And you know, there was there was other other sort of you know, Switzerland got to the the quarterfinals as well. But then ultu ultimately the top four seeds ended up into the semifinals. So how do you sort of assess that from a f from a a sports betting perspective?
Pontus (15:01.564)
Yeah.
Pontus (15:11.4)
That's a brilliant question because I was in the same position before the tournament I was very nervous about the first half of the tournament because we saw all those teams that You know, we didn't know what to expect from them and you could see okay there there are like 20 games where we're just gonna lose money and pay out but those teams stood up, you know, and they did things that No one did expect
So it's like the beauty of sports. It was shown there as well. And yeah, with all those teams that we had with this new tournament format, of course, we expected it to be more uneven games, but still we have seen a lot of surprises and we have seen strong performances that we didn't expect. So it has turned out better.
than I expected in that regard.
Charlie Horner (16:12.436)
Yeah, certainly. I think if you said before the tournament that there would be one team that didn't lose to either finalists in ninety minutes, I don't think many people would have said Cape Verde. But so so that was a great storyline. Pontus, let's let's sort of go towards our our final question now. I really appreciate you taking the time out on such a busy day when you're sort of reporting results and talking to investors.
What can we expect to see from Betson throughout the remainder of of twenty twenty six as you sort of look to continue on the the operational successes that you've seen throughout the year so far?
Pontus (16:47.26)
Yeah, think what we do here in the second quarter is a really good performance. We will definitely keep on the same way there in the B2C part. And hopefully we will be able to develop our B2B offering even more and hopefully serve our clients better there to get back to growth.
in B2B as well. Maybe not, you know, sequentially year over year growth in the near future, but still, if we can get to growth quarter on quarter, that's a very good development that I'm hoping for.
Charlie Horner (17:41.421)
Fantastic. Well, Pontus, once again, thank you for joining us. Really appreciated the time and I've really enjoyed the chat as well. So thanks a lot and I'm sure we'll speak again very soon. thank you to Optimu for supporting the show as always, and to our listeners, thank you for tuning in to today's episode of iGaming Daily, and come back tomorrow to keep up to date with all the latest global gambling news.
Pontus (17:51.932)
That's what it.