Swedish gaming software provider NetEnt released its interim financial report for the second quarter of 2015 as well as for the six-month period ended June 30.
Revenue for the second quarter of the year totaled SEK271.2 million, up 32.3% year-on-year. The amount of SEK205 million was posted for the same period a year ago. Operating profit grew by 63.3% to reach SEK92.7 million. Operating margin increased to 34.2% due to the constantly growing revenue as well as economies of scale. Last but not least, profit after tax totaled SEK86.5 million, up 64.9% year-on-year.
During the second quarter of the year, NetEnt’s products went live with major gambling companies such as PokerStars, Gamesys, bwin.party, and Danske Spil. The gaming supplier also signed a key cross-license patent agreement with IGT. Over the past three months, the company was awarded gaming licenses in Spain and launched a selection of its solutions with a number of clients there.
NetEnt also entered two strategic partnerships with bwin.party and Borgata as well as Caesars Interactive Entertainment. Thus, its games will go live in New Jersey, provided that the local gaming regulator gives it the necessary approval. Towards the end of the quarter, the Swedish company launched Starburst, one of its most popular titles, in William Hill’s retail shops across the United Kingdom. This was NetEnt’s first-ever product to go live in land-based gaming facilities.
As for the company’s performance for the six months ended June 30, revenue rose 34.6% to reach SEK529.5 million. Operating profit posted a 61.7% increase to SEK174.5 million. Operating margin for the first half of the year was 33%. Profit after tax totaled SEK160.7 million, up 63% as compared to what was posted for the same period in 2014.
Per Eriksson, President and Chief Executive Officer of the gaming supplier, commented that the company continued its expansion in new markets such as Spain and the US. Furthermore, its market share in the UK increased further. The country turned into NetEnt’s third largest market in terms of revenue and a “key factor behind [its] strong growth.”
Mr. Eriksson pointed to its Live Casino solutions as extremely important, as they would certainly contribute to the company’s further growth and market share gains. In May, NetEnt’s Live Casino was launched in Italy.
As for the supplier’s mobile business, it, too, kept on growing during the second quarter of the year. Revenue from mobile games accounted for 23% of the overall turnover. In comparison, those represented a 13% share for the same period a year ago.
Mr. Eriksson also commented that retail is a segment that would most definitely become important for his company in future, as about 95% of casino gaming is still taking place offline. The executive said that his company would focus its attention on capitalizing “on the trend of increasing convergence between offline and online” gaming.
