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Super Group Reports Financial Results for First Quarter 2024
Neal Menashe, Chief Executive Officer of Super Group, commented: "We've had a phenomenal start to the year, continuing our momentum from a strong end to 2023. This robust performance has been delivered by our global team's ongoing focus and investment into core markets that are yielding strong returns, providing us with a solid foundation for the remainder of the year."
Alinda van Wyk, Chief Financial Officer of Super Group, stated: "We achieved record results for a first quarter of EUR374 million of revenue and EUR69 million of Adjusted EBITDA, for the ex-US business. Our laser focus on creating a leaner, more efficient operating model has delivered results, with Q1 operating expenses as a percentage of net revenue falling to below 19%. Investment into high-growth areas of the business continues at pace and we remain confident that we are in a strong position to realize our goals set for 2024."
Financial Highlights:
Revenue increased by 12% to EUR379.3 million for the first quarter 2024 (constant currency: 17% to EUR389.3 million) from EUR338.5 million in the same period from the prior year driven by growth from Africa and North America (predominantly Canada) markets partially offset by declines from the Middle East and Asia-Pacific market. Profit for the period was EUR41.0 million for the first quarter 2024, which included a gain on disposal of the B2B division of Digital Gaming Corporation Limited ("DGC") of EUR40.1 million as well as a non-cash charge of EUR13.1 million related to the increase in fair value of option liability. Loss for the period of EUR1.9 million for the first quarter of 2023 included the non-cash charge of EUR2.2 million related to the change in fair value of option liability. Adjusted EBITDA, a non-GAAP measure, increased 29% to EUR46.5 million for the first quarter 2024 compared to EUR36.1 million in the first quarter of 2023. Monthly Active Customers increased 33% to 4.7 million during the first quarter of 2024 from 3.5 million in the first quarter of 2023. Cash and cash equivalents was EUR289.2 million at March 31, 2024, up from EUR241.9 million at December 31, 2023. This net increase during the first quarter 2024 was the result of: Inflows from operating activities amounting to EUR69.8 million; Outflows from investing activities of EUR20.4 million. This was mainly as a result of further investment in tangible and intangible assets of EUR20.6 million, predominantly due to the capitalization expenditure on software, issuance of loan to Apricot Investments Limited of EUR10.0 million and deferred consideration paid of EUR2.1 million relating to the 15 Marketing Limited acquisition. These were offset in part by EUR9.2 million consideration received from the sale of the B2B division of DGC, as well as EUR3.7 million resulting from receipts of interest and repayment of loans receivable; Outflows from financing activities of EUR1.7 million due to lease payments; and A loss of EUR0.5 million as a result of foreign currency fluctuations on foreign cash balances held over this period.
Revenue by Geographical Region for the Three Months Ended March 31, 2024 in EUR '000s: Betway Betway Spin Total Africa and Middle East 139,274 396 139,670 Asia-Pacific 7,927 27,115 35,042 Europe 39,006 18,620 57,626 North America 32,298 108,596 140,894 South/Latin America 3,453 2,566 6,019 ------- ------- ------- Total revenue 221,958 157,293 379,251 ------- ------- ------- % % % ------- ------- ------- Africa and Middle East 61 % 0 % 37 % Asia-Pacific 4 % 17 % 9 % Europe 18 % 12 % 15 % North America 15 % 69 % 37 %
Revenue by Geographical Region for the Three Months Ended March 31, 2023 in EUR '000s: Betway Betway Spin Total Africa and Middle East 87,424 455 87,879 Asia-Pacific 35,048 22,949 57,997 Europe 34,489 21,338 55,827 North America 37,655 92,550 130,205 South/Latin America 3,676 2,937 6,613 ------- ------- ------- Total revenue 198,292 140,229 338,521 ------- ------- ------- % % % ------- ------- ------- Africa and Middle East 44 % 0 % 26 % Asia-Pacific 18 % 16 % 17 % Europe 17 % 15 % 16 % North America 19 % 67 % 39 %
Revenue by product line for the Three Months Ended March 31, 2024 in EUR '000s: Betway Spin Total 135,304 156,858 292,162 Online casino(1) 76,842 60 76,902 Sports betting(1) 5,870 -- 5,870 Brand licensing(2) 3,942 375 4,317 Other(3) ------- -------------- -------
Revenue by product line for the Three Months Ended March 31, 2023 in EUR '000s: Betway Betway Spin Total Online casino(1) 102,995 139,975 242,970 81,432 45 81,477 Sports betting(1) 8,832 -- 8,832 Brand licensing(2) 5,033 209 5,242 Other(3) --------- -------------- ---------
(1)Sports betting and online casino revenues are not within the scope of IFRS 15 'Revenue from Contracts with Customers' and are treated as derivatives under IFRS 9 'Financial Instruments'. Fixed Odds Contingencies has been reclassified from sports in the prior period to online casino in order to align to the current year classification. Fixed Odds Contingencies are casino style games in respect of which the odds are agreed at the time of the bet and accepted under the sports licenses in certain jurisdictions. Sports betting and online casino revenues are not within the scope of IFRS 15 'Revenue from Contracts with Customers' and are treated as derivatives under IFRS 9 'Financial Instruments'. Fixed Odds Contingencies has been reclassified from sports in the prior period to online casino in order to align to the current year classification. Fixed Odds Contingencies are casino style games in respect of which the odds are agreed at the time of the bet and accepted under the sports licenses in certain jurisdictions. (2)Brand licensing revenues are within the scope of IFRS 15 'Revenue from Contracts with Customers'. Brand licensing revenues are within the scope of IFRS 15 'Revenue from Contracts with Customers'.
Non-GAAP Financial Information
This press release includes non-GAAP financial information not presented in accordance with the International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board.
EBITDA, Adjusted EBITDA and revenue on a constant currency basis are non-GAAP company-specific performance measures that Super Group uses to supplement the Company's results presented in accordance with IFRS. EBITDA is defined as profit before depreciation, amortization, finance income, finance expense and income tax expense/credit. Adjusted EBITDA is EBITDA adjusted for market closure costs, adjusted RSU expense, change in fair value of option liabilities, unrealized foreign currency gains and losses, gain on disposal of business and other adjustments. Constant currency revenue growth is calculated by translating non-Euro performance for 2023 and 2024 using 2023 exchange rates.
Super Group believes that these non-GAAP measures are useful in evaluating the Company's operating performance as they are similar to measures reported by the Company's public competitors and are regularly used by securities analysts, institutional investors and other interested parties in analyzing operating performance and prospects.
Management does not consider these non-GAAP measures in isolation or as an alternative to financial measures determined in accordance with IFRS. The principal limitation of these non-GAAP financial measures is that they exclude significant expenses that are required by IFRS to be recorded in Super Group's financial statements. In order to compensate for these limitations, management presents non-GAAP financial measures together with IFRS results. Non-GAAP measures should be considered in addition to results and guidance prepared in accordance with IFRS, but should not be considered a substitute for, or superior to, IFRS results.
Reconciliation tables of the most comparable IFRS financial measure to the non-GAAP financial measures used in this press release and supplemental materials are included below. Super Group urges investors to review the reconciliation and not to rely on any single financial measure to evaluate its business. In addition, other companies, including companies in our industry, may calculate similarly named non-GAAP measures differently than we do, which limits their usefulness in comparing our financial results with theirs.
Reconciliation of Profit / (Loss) after taxation to EBITDA and Adjusted EBITDA for the three months ended March 31, in EUR '000s: 2024 2023 Profit / (loss) for the period 40,964 (1,924 ) 7,745 6,437 Income tax expense (3,069 ) (1,195 ) Finance income 1,238 547 Finance expense 19,902 21,445 Depreciation and amortization expense ---------- -------------------- -------------- -------------------- EBITDA 66,780 25,310 326 -- Market closure 13,106 2,191 Change in fair value of option 3,718 4,140 RSU expense(1) 3,126 3,111 Unrealized foreign exchange(1) (40,135 ) -- Gain on disposal of business Other adjustments(1) (462 ) 1,315 ---------- -------------------- -------------- -------------------- Adjusted EBITDA 46,459 36,067 Adjusted EBITDA, ex-US 68,749 52,543
(1)Adjusted EBITDA has been restated for the prior period presented to include unrealized foreign exchange movements, additional RSU expenses and other adjustments. Adjusted EBITDA has been restated for the prior period presented to include unrealized foreign exchange movements, additional RSU expenses and other adjustments.
Webcast Details
The Company will host a webcast at 8:30 a.m. ET today to discuss the first quarter 2024 financial results. Participants may access the live webcast and supplemental earnings presentation on the events & presentations page of the Super Group Investor Relations website at: https://investors.sghc.com/events-and-presentations/default.aspx.
About Super Group (SGHC) Limited
Super Group (SGHC) Limited is the holding company for leading global online sports betting and gaming businesses: Betway, a premier online sports betting brand, and Spin, a multi-brand online casino offering. The group is licensed in multiple jurisdictions, with leading positions in key markets throughout Europe, the Americas and Africa. The group's sports betting and online gaming offerings are underpinned by its scale and leading technology, enabling fast and effective entry into new markets. Its proprietary marketing and data analytics engine empowers it to responsibly provide a unique and personalized customer experience. Super Group has been ranked no.6 in the EGR Power 50 for the last two years. For more information, visit www.sghc.com.
Source: Super Group
Forward-Looking Statements
Certain statements made in this press release are "forward looking statements" within the meaning of the "safe harbor" provisions of the United States Private Securities Litigation Reform Act of 1995.
These forward-looking statements include, but are not limited to, expectations and timing related to market entries and expansion, projections of market opportunity, growth and profitability of expected growth of Super Group's customer base, expansion into new markets and expectations for the remainder of 2024.
These forward-looking statements generally are identified by the words "believe," "project," "expect," "anticipate," "estimate," "intend," "strategy," "future," "opportunity," "plan," "pipeline," "may," "should," "will," "would," "will be," "will continue," "will likely result," and similar expressions. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Many factors could cause actual future events to differ materially from the forward-looking statements in this press release, including but not limited to: (i) the ability to implement business plans, forecasts and other expectations, and identify and realize additional opportunities; (ii) the ability to maintain the listing of Super Group's securities on a national securities exchange; (iii) changes in the competitive and regulated industries in which Super Group operates; (iv) variations in operating performance across competitors; (v) changes in laws and regulations affecting Super Group's business; (vi) Super Group's inability to meet or exceed its financial projections; (vii) changes in general economic conditions; (viii) changes in domestic and foreign business, market, financial, political and legal conditions; (ix) future global, regional or local economic and market conditions affecting the sports betting and gaming industry; (x) changes in existing laws and regulations, or their interpretation or enforcement, or the regulatory climate with respect to the sports betting and gaming industry; (xi) the ability of Super Group's customers to deposit funds in order to participate in Super Group's gaming products; (xii) compliance with regulatory requirements in a particular regulated jurisdiction, or Super Group's ability to successfully obtain a license or permit applied for in a particular regulated jurisdiction, or maintain, renew or expand existing licenses; (xiii) the technological solutions Super Group has in place to block customers in certain jurisdictions, including jurisdictions where Super Group's business is illegal, or which are sanctioned by countries in which Super Group operates from accessing its offerings; (xiv) Super Group's ability to restrict and manage betting limits at the individual customer level based on individual customer profiles and risk level to the enterprise; (xv) the ability by Super Group's key executives, certain employees or other individuals related to the business, including significant shareholders, to obtain the necessary licenses or comply with individual regulatory obligations in certain jurisdictions; (xvi) protection or enforcement of Super Group's intellectual property rights, the confidentiality of its trade secrets and confidential information, or the costs involved in protecting or enforcing Super Group's intellectual property rights and confidential information; (xvii) compliance with applicable data protection and privacy laws in Super Group's collection, storage and use, including sharing and international transfers, of personal data; (xviii) failures, errors, defects or disruptions in Super Group's information technology and other systems and platforms; (xix) Super Group's ability to develop new products, services, and solutions, bring them to market in a timely manner, and make enhancements to its platform; (xx) Super Group's ability to maintain and grow its market share, including its ability to enter new markets and acquire and retain paying customers; (xxi) the success, including win or hold rates, of existing and future online betting and gaming products; (xxii) competition within the broader entertainment industry; (xxiii) Super Group's reliance on strategic relationships with land based casinos, sports teams, event planners, local licensing partners and advertisers; (xxiv) events or media coverage relating to, or the popularity of, online betting and gaming industry; (xxv) trading, liability management and pricing risk related to Super Group's participation in the sports betting and gaming industry; (xxvi) accessibility to the services of banks, credit card issuers and payment processing services providers due to the nature of Super Group's business; (xxvii) the regulatory approvals related to proposed acquisitions and the integration of the acquired businesses; and (xxviii) other risks and uncertainties indicated from time to time for Super Group including those under the heading "Risk Factors" in our Annual Report on Form 20-F filed with the SEC on April 25, 2024, and in Super Group's other filings with the SEC. The foregoing list of factors is not exhaustive. You should carefully consider the foregoing factors and the other risks and uncertainties described in other documents filed or that may be filed by Super Group from time to time with the SEC. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Forward-looking statements speak only as of the date they are made. Readers are cautioned not to put undue reliance on forward-looking statements, and Super Group assumes no obligation and does not intend to update or revise these forward-looking statements, whether as a result of new information, future events, or otherwise. Super Group does not give any assurance that it will achieve its expectations.
Super Group (SGHC) Limited
Unaudited Consolidated Statements of Profit or Loss and Other Comprehensive Income
for the three months ended March 31, 2024 and 2023
(EUR in '000s, except for shares and profit (loss) per share)
2024 2023
Revenue 379,251 338,521
Direct and marketing expenses (303,890 ) (275,710 )
General and administrative expenses (39,202 ) (36,591 )
Other operating income 3,592 1,281
Gain on disposal of business 40,135 --
Depreciation and amortization expense (19,902 ) (21,445 )
Finance income 3,069 1,195
Finance expense (1,238 ) (547 )
Change in fair value of option (13,106 ) (2,191 )
------------- -------------------- -------------- --------------------
Profit before taxation 48,709 4,513
Income tax expense (7,746 ) (6,437 )
------------- -------------------- -------------- --------------------
Profit / (loss) for the period 40,964 (1,924 )
Profit / (loss) for the period attributable to:
Owners of the parent 41,176 (2,406 )
Non-controlling interest (212 ) 482
------------- -------------------- -------------- --------------------
40,964 (1,924 )
Other comprehensive income items that may be reclassified subsequently to profit
Foreign currency translation 6,112 (1,982 )
------------- -------------------- -------------------- -------------- --------------------
Other comprehensive income / (expense) for the period 6,112 (1,982 )
--------------------------------- ----------------------------------
Total comprehensive profit / (loss) for the period 47,076 (3,906 )
============= ==================== ============== ====================
Total comprehensive profit / (loss) for the period attributable to:
Owners of the parent 47,288 (4,388 )
Non-controlling interest (212 ) 482
------------- -------------------- -------------- --------------------
47,076 (3,906 )
============= ==================== ============== ====================
Weighted average shares outstanding, basic 500,566,918 498,154,854
Weighted average shares outstanding, diluted 501,937,886 498,154,854
Profit / (loss) per share, basic (cents) 8.23 (0.48 )
Super Group (SGHC) Limited
Consolidated Statements of Financial Position
as at March 31, 2024 and December 31, 2023
(EUR in '000s)
Unaudited
2024 2023
ASSETS
Non-current assets
193,091 193,395
Intangible assets
96,035 94,915
Goodwill
17,327 17,406
Property, plant and equipment
23,224 24,866
Right-of-use assets
35,368 36,703
Deferred tax assets
12,501 11,951
Regulatory deposits
99,092 89,090
Loans receivable
174 174
Investments in non-listed equity
-------------------- -------------------- ---------- --------------------
476,812 468,500
Current assets
133,681 154,615
Trade and other receivables
Loans receivable 6,087 6,719 6,719
17,230 12,535
Income tax receivables
37,745 38,287
Restricted cash
289,185 241,923
Cash and cash equivalents
-- 38,292
Assets held for sale
-------------------- -------------------- ---------- --------------------
483,928 492,371
-------------------- -------------------- ---------- --------------------
TOTAL ASSETS 960,740 960,871
==================== ==================== ========== ====================
Non-Current liabilities
22,451 23,919
Lease liabilities
3,582 4,684
Deferred tax liability
2,056 2,056
Derivative financial instruments
322
Deferred and contingent consideration 327 322
-------------------- -------------------- ----------
28,416 30,981
Current liabilities
5,425 5,226
Lease liabilities
68 87
Interest-bearing loans and borrowings
305 2,392
Deferred and contingent consideration
232,776 195,392
Trade and other payables
57,585 67,592
Customer liabilities
8,432 44,826
Provisions
38,145 25,840
Income tax payables
-- 42,600
Derivative liability associated with assets held for sale
-- 7,140
Liabilities associated with assets held for sale
-------------------- -------------------- ---------- --------------------
342,736 391,095
-------------------- -------------------- ---------- --------------------
TOTAL LIABILITIES 371,152 422,076
==================== ==================== ========== ====================
EQUITY
289,753 289,753
Issued capital
(2,632 ) (2,632 )
Treasury stock
(1,312 ) (7,424 )
Foreign exchange reserve
285,511 240,618
Retained profit
-------------------- -------------------- ---------- --------------------
Equity attributable to owners of the parent 571,320 520,315
18,268 18,480
Non-controlling Interest
-------------------- -------------------- ---------- --------------------
SHAREHOLDERS' EQUITY 589,588 538,795
-------------------- -------------------- ---------- --------------------
View source version on businesswire.com: https://www.businesswire.com/news/home/20240507230573/en/
SOURCE: Super Group
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Investors: investors@sghc.com Media: media@sghc.com
COMTEX_452059797/1006/2024-05-08T07:53:01