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LeoVegas AB Q1: Quarterly report 1 January – 31 March 2021

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LeoVegas AB Q2: Quarterly report 1 April – 30 June 2021
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“A good start to the year and increased focus on sports”
Gustaf Hagman, Group CEO

first quarter 2021: 1 january–31 march        

  • Revenue increased by 8% to EUR 96.7 m (89.4). Organic growth in local currencies was 8%.
  • Organic growth when excluding Germany was 19%.
  • Adjusted EBITDA was EUR 10.9 m (9.0), corresponding to an adjusted EBITDA margin of 11.3% (10.0%). Reported EBITDA was EUR 10.4 m (9.0).
  • The number of depositing customers was 462,386 (413,269), an increase of 12%.
  • Adjusted earnings per share were EUR 0.07 (0.06).

events during the quarter

  • LeoVegas acquired Expekt from Betclic Group for a total purchase price of EUR 5 m. Expekt is one of the most well-known sports betting brands in Sweden and the Nordic markets, and strengthens LeoVegas’ brand portfolio ahead of the intensive sport event years in 2021 and 2022. The acquisition of Expekt is expected to be completed in May 2021.
  • LeoVegas’ shares were taken up for trading in USD on OTCQX Markets in the USA. This is a way for the company to meet a steadily growing interest from US investors.
  • Via LeoVentures, LeoVegas invested EUR 1.1 m for 25% of the shares in SharedPlay, a company that makes it possible for players to share their gaming experiences with others through the industry’s first multiplayer solution.

Events after the end of the quarter

  • Preliminary revenue in April amounted to EUR 32.7 m (37.5), representing negative growth of 13%. Excluding Germany, revenue grew 4%.
  • The Royal Panda brand has been migrated to the Group’s proprietary technical platform, Rhino. All of the Group’s wholly owned brands are now run on the Rhino platform.
  • LeoVegas has started its own game studio, Blue Guru Games, to develop new and innovative games. The studio will develop exclusive games for LeoVegas as well as for other operators. The first games will be released in late 2021.
  • LeoVegas was issued a sanction fee of SEK 2 m by the Swedish Gambling Authority. The company intends to appeal the decision.

 

COMMENT FROM GUSTAF HAGMAN – GROUP CEO

FIRST QUARTER
We are pleased with the start of the year and increased our revenue by 8% during the first quarter. Excluding Germany, which has been affected by new restrictions related to the upcoming regulation, revenue increased by 19%. Our growth has been driven mainly by our loyal customer base, which reached a new record level during the period. We have maintained a high pace of investment, and despite this we achieved adjusted EBITDA growth of 22%, driven by our scalability and good cost control.

ACQUISITION OF EXPEKT – increased FOCUS ON SPORTS BETTING
During the first quarter we acquired the well-known sports betting brand Expekt. The acquisition gives us one more leg to grow on and complements the Group’s brand portfolio and product offering in a strategically good way. We are looking forward to Expekt once again becoming a leading sports betting brand in Sweden and thereafter also in other markets. The acquisition is expected to be completed in May in connection with our migration of the brand to our own technical platform. The timing of the acquisition is perfect as we are now facing two years filled with major sports events, and we plan to launch Expekt well in advance of the UEFA European Football Championship, which starts in June.

MarKETS
During the first quarter we saw the full effect of the changes taking place in the German market. Operators in the market are acting differently with respect to implementing the new restrictions, which unfortunately has led to a skewed competitive situation. The assessment is that up to 70%-80% of the German market for casino has temporarily been shifted over to operators that have chosen to not adapt to the coming market regulation. Our hope is that this will soon be sorted out by the German authorities, which is a prerequisite for the licence system’s success, with a high level of channelisation and consumer protection. Germany generated approximately 6% of the Group’s total revenue during the first quarter, compared with 15% a quarter earlier. Despite this development in Germany we delivered good growth at the Group level, which reflects our strong performance in many other key markets, including Italy, Canada and Spain. Our business is more diversified than ever before, and growth at the Group level is proof that our data-driven way of working and allocating marketing investments is effective.

I also want to highlight Sweden, where the strength of the LeoVegas brand and our product breadth is appreciated by our customers. Our Swedish customer base set a new record during the quarter, and in March we grew on a yearly basis for the first time since the temporary Covid-19 restrictions were implemented in July 2020.

leoventures
The first quarter was an intensive period for our investment vehicle LeoVentures. Among other things we invested in SharedPlay, a company that makes it possible for players to share their gaming experiences with others through the industry’s first multiplayer solution. For a long time we have created successful,  exclusive games with the help of external providers. We are now taking the next step by starting our own game studio – Blue Guru Games. This venture will give us full control and greater flexibility in developing new games, a unique offering to our players, and also a new revenue stream for the Group.

COMMENTS ON the SECOND QUARTER
Revenue for the month of April amounted to EUR 32.7 m (37.5), corresponding to negative growth of 13%. Excluding Germany, growth in April was positive at 4%.

Finally I want to urge you to be on the lookout for the new launch of Expekt in Sweden towards the end of May – you won’t be disappointed!

Presentation of the report – today at 09:00 CET

  • To participate in the conference call, and thereby be able to ask questions, please call one of the following numbers: SE: +46 (0) 8 50 69 21 80, UK: +44 (0) 20 71 92 80 00, US: +1 63 15 10 74 95, Confirmation code: 6888544 or join at the web https://edge.media-server.com/mmc/p/x6q2utt4

This information is information that LeoVegas AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation 596/2014. The information was submitted for publication, through the agency of the contact person set out below, at 08:00 CET on 6th of May 2021.

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PushFar and Limit Break team up to improve diversity in gaming industry

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PushFar and Limit Break team up to improve diversity in gaming industry
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PushFar, a mentoring and career progression platform, has partnered with Limit Break, a mentorship program in the games industry, to help improve diversity, inclusion and equality.

Limit Break is using PushFar’s platform to offer a mentorship program for underrepresented people working in the UK gaming industry. Recent figures show that 70% of people working in the gaming industry are male, compared to 28% female and 2% non-binary workers, and that 10% of people are Black, Asian or minority ethnic (BAME).

Founder Anisa Sanusi established Limit Break in 2019 when she found it challenging to find a mentor in the gaming industry. She recognised the value of guidance and role models for underrepresented genders, LGBQT+ and people of colour, with representation in the workforce significantly below the national average of those in work.

Limit Break turned to Pushfar for a solution because the popularity of the mentoring program meant it was time consuming and required scaling. PushFar set up an accessible and intuitive platform, making it easy to match members based on their specific profiles, and allowing the program to have international reach. The platform also enables people to connect with people from specific backgrounds through a self-matching feature. Limit Break now has up to 700 people on their mentoring program, and has seen an increase in member retention.

Ed Johnson, CEO and Founder of PushFar, said: “Having a mentoring relationship is often noted as being one of the most beneficial things you can do for career development. Employees feel motivated and supported when they see senior leaders with whom they can relate. Limit Break has recognised the advantages mentoring can bring to their industry, and taken an active role in addressing diversity and inclusion issues through it. We’re delighted to be part of this solution and hope that our platform will help more people from under-represented groups join the games industry”.

Anisa Sanusi, Founder of Limit Break, said: “Actively mentoring candidates enables us to facilitate connections for a young workforce to those with experience. We want to help to keep the games industry rich with diverse talent and passion, and hope that our program will enable more people from under-represented groups to join the industry. Creating a mentorship program can be a time consuming and complicated task, but by using PushFar we’ve been able to make it simple and easy for everyone involved.”

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Compliance Updates

MGA | Updates to the Gaming Authorisations and Compliance Directive & Key Function Eligibility Criteria Policy

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MGA | Updates to the Gaming Authorisations and Compliance Directive & Key Function Eligibility Criteria Policy
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The Malta Gaming Authority is hereby publishing a series of amendments to the Gaming Authorisations and Compliance Directive (Directive 3 of 2018). The amendments mainly relate to the following:

  • The overall number of key function roles and their underlying responsibilities;
  • The deadlines by when certain key function requirements are to be observed;
  • The persons who shall shoulder responsibility in the absence of duly appointed key function holders;
  • The manner and form in which declarations and assurances are to be made by auditors on behalf of licensees during submission of audited financial statements; and
  • The applicability of suspicious betting reporting requirements.

These amendments are being published together with a Policy on the Eligibility and Ongoing Competency Criteria for Key Persons. This Policy is intended to revise and collate the existing eligibility criteria while also introducing authorisation renewal requirements related to continuous professional development for existing key persons. Moreover, the Policy clarifies the MGA’s position regarding the compatibility of key function roles with each other in light of the amendments to the Directive.

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Latest News

It’s Official! SoftGamings and Golden Hero Collaboration Is Underway

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It’s Official! SoftGamings and Golden Hero Collaboration Is Underway
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For SoftGamings, there are never enough good-quality game providers in its network, and the newest addition of Golden Hero is a testament to that fact.

Golden Hero is an Isle-of-Man-based operator known for its production and development of video slots and pachislos, a special series of slots based on Japanese pachinko games. The brand’s popularity in Japan and other Asian markets comes from its successful games and partnerships with the industry giants such as JTG. This success prompted it to seek a reliable aggregation platform to expand its reach beyond the existing markets, and SoftGamings was a natural choice.

All of Golden Hero’s games are created using the latest HTML5 technology, which focuses on mobile casino gaming. Even though its portfolio is not grandiose in number, the quality of the games it offers is undeniable. One of its most successful titles is the Battle Dwarf pachislo, voted the 2019 Game of the Year at Slotcatalog.com. Other player-favourites include Jewel Race, Hawaiian Dream, and many more.

Golden Hero is a game provider licensed by the Malta Gaming Authority and certified by SIQ, which guarantees the fairness and safety of its games. In addition, the Gamesys Group, a company that owns Golden Hero, has recently been acquired by Bally’s Corporation, making Golden Hero a part of one of the world’s largest casino corporations.

Here’s what Irina Sazonova, the director of partnerships at SoftGamings, said when reflecting on the deal: “We are overjoyed to welcome Golden Hero to our fold and, with it, give our operators a chance to improve their game portfolios with exciting and never-before-seen titles. By working with us, Golden Hero will get a chance to expand to new markets and showcase its products in the best possible way, so this partnership is the essence of a win-win situation for all parties concerned.”

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