Super Group Reports Decreased Earnings and Profits in 2022

## A Large Company’s Earnings and Profits Decrease in the Past Fiscal Year

Betway’s parent organization, a large multinational, reported earnings of €1.29 billion (£1.13 billion/$1.38 billion) for 2022, a period characterized by widespread decreases.

The company’s revenue experienced a 2.1% decline compared to the previous year.

The organization implemented several strategic actions during the year. Its $4.75 billion merger with SEAC was finalized in January 2022 after shareholder approval. In June, four of its brands, including its primary gaming brand Spin, were granted permission to operate in Ontario.

In early January, the company was authorized to launch in the US after acquiring Betway’s local operations.

The CEO of the company, Neil Menash, stated that the organization is eager to expand its global presence, particularly in the US.

“This company is a leading global pure-play sports betting and online casino company dedicated to continuously improving and expanding its global reach, including in the US,” Menash stated. “We continue to invest wisely in our brands, enhance our technology platform, and benefit from our consistent cash flow.

“We believe we are well-prepared to apply our proven strategy to the US market and take advantage of the multi-year investment opportunity we see.”

Arlinda van Wyck, the Chief Financial Officer of Super Group, stated that upcoming investments will concentrate on technology and advertising to further propel the company’s expansion in 2023.

“Super Group’s financial standing remains robust, and we continue to operate profitably while investing in technology and marketing to support future growth,” van Wyck remarked. “We remain dedicated to enhancing operational effectiveness in 2023 to augment scale and future operating margins.”

Yearly Outcomes

Full-year 2022 income encompassed net revenue and additional revenue, which included brand licensing revenue.

Income was primarily generated from online casino revenue, totaling €816 million. This represented a 5.4% decline compared to 2021.

Sports betting revenue attained €439 million, an increase of 12.2% compared to the 2021 fiscal year. Other revenue amounted to €41 million, a decrease of 42.2%, accounting for the remaining income.

Total direct expenses for the year amounted to €473 million, slightly higher than €455 million in 2021.

Marketing expenses decreased slightly to €344 million, compared to €351 million in 2021. General and administrative expenditures also increased by €52 million, reaching €270 million.

Total profit before taxation for the year amounted to €233.7 million, an increase of 3.4%. After €2.2 million in financial income, €0.92 million in financial expenses, and €65.7 million in depreciation and amortization, the year’s earnings before interest, taxes, depreciation, and amortization (EBITDA) reached €298.1 million, a decrease of 5.2%.

A collection of additional expenditures, encompassing transaction charges, stock-based remuneration, and currency fluctuations on warrants and earn-out valuation, along with some income, resulted in an adjusted EBITDA of €199.2 million, representing a 31.1% decrease compared to the previous year.

Following €2.6 million in unrealized foreign exchange, €7.7 million in non-recurring and non-current operational modifications, and €1.1 million in pre-acquisition losses, operating EBITDA reached €208.4 million, reflecting a 31.1% decline year-on-year.

**Final Quarter**

Revenue for the final quarter concluding on December 31 amounted to €329 million, exhibiting a 3.5% decrease from the corresponding period in 2021.

Online casinos once again dominated revenue generation, achieving €209 million. Sports betting revenue stood at €113 million, while other revenue sources contributed €7 million.

Direct costs for the quarter totaled €120 million, marking an increase of €2 million compared to the final quarter of 2021. Marketing expenditures also remained relatively stable, rising by €1 million to €95 million. Meanwhile, general and administrative expenses for the quarter reached €72 million, representing a substantial increase of 24.1%.

Profit before tax amounted to €38.2 million, reflecting a 38.8% year-on-year decline. €1 million in financial income, €0.086 million in financial expenses, and €18.8 million in depreciation and amortization expenses brought EBITDA to €56.1 million, representing a 32.5% decrease.

Various other costs significantly reduced the overall EBITDA. Notably, the €43.3 million change in fair value of earn-out liabilities impacted the total. However, €10.5 million in restricted stock unit expenses provided a positive contribution.

Taking into account the profits and expenses, modified earnings before interest, taxes, depreciation, and amortization for the quarter amounted to €17.9 million, a reduction of 73.8% in comparison to the corresponding period in the previous year.

After factoring in unrealized foreign currency fluctuations of €22.1 million, non-routine and non-ongoing operational modifications of €3.5 million, and pre-acquisition losses of €1.3 million, operational EBITDA for the quarter reached €42.3 million, a decrease of 39.1% compared to the equivalent period in the preceding year.

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