Intralot appointed Nikolaos Nikolakopoulos its new CEO. The group also announced its first quarter results.
Nikolakopoulos is appointed CEO of Intralot immediately. He will sit with eleven other board members, including Chairman Sokratis Kokokalis and Vice-Chair Constantinos Antonopoulos.
Intralot made the announcement at its general meeting which was held before publishing Q1’s results. In addition, the meeting established a three-member audit committee consisting of independent nonexecutive directors: Adamantini Lazari and Dionysia Karamichalis.
Intralot’s financial performance was mixed in the first quarter, which ended on 31 March. The revenue fell by 4.8% on an annual basis to EUR85.1m ($92.8m/£72.5m), but the net profit for continuing operations increased.
Kokkalis summarized the quarterly results and said that the results confirmed Intralot’s “stable” course. Kokkalis also referred to certain refinancing which he claimed will help the group on a longer-term basis.
Kokkalis stated that “during Q1, the Group completed the refinancing 2024 bonds by issuing a bond listed on the Athens Stock Exchange, and a loan syndicated with five Greek Banks at more favorable terms than the ones on international markets.”
The results also confirm that the firm is on a stable track and has achieved the financial targets set. “The company continues to pursue several major projects in North America as well as Australia and Brazil.”
Why did revenue drop in the first quarter?
Intralot analyzed the results of Q1 and found several factors that contributed to the revenue decline.
This was primarily due to lower revenues from B2C licensed operations in Argentina. The main reason for this is the unfavourable currency exchange rate following the devaluation of the peso in 2023. In this case, the revenue was EUR4.8m or 43.2% lower. The data for the current year shows an increase of 132.2%.
Intralot reported a drop of 1.6% in revenues from contracts for technology and support across both B2B and G2G. It says that this is mainly because of negative currency exchange rates in Argentina.
The US lottery sales grew strongly in spite of the timing issues.
However, there was better news regarding management contracts. Revenues rose by 8.8%. Intralot stated that this growth was due to local market expansion and a gain of market share in Turkey despite headwinds on the Turkish Lira.
Intralot noted that the lower revenue recorded in Morocco partially offset its performance in Turkey. The reason for this is that a contract was renewed with a lower contract value because of its smaller scope.
The remaining 7.5% of Q1 revenues came from B2C activities. According to the game types, 56.5% came from lottery games, 22.4% were generated by sports betting, 12.2% was produced by video lottery terminals, and 8.9% of revenue came from IT services and products.
The Americas was Intralot’s main market, with EUR50.62m of revenue. However, this is 13.1% lower than the prior year. The revenue for Europe was down by 6.7%, to EUR14.6m. However, revenue from other regions increased 21.5% and reached EUR23.3m.
Net profit improves despite higher spending at Intralot
Operating expenses increased 18.6% in the first quarter to EUR26.9m. Intralot attributes this to increased marketing expenditure in Turkey in order to increase market share in the country.
Intralot also saw an increase in depreciation costs, which rose by 8.5%. However, it was still able to cut interest costs as well as other expenses. It was therefore left with an pre-tax loss of EUR5.4m. This is down by 50.7% compared to the prior year.
Intralot had to pay EUR400,000 as tax, which after accounting for the minority stake, allowed it to report a profit net of EUR3.9m. It is 25,1% more than Q1 2023.
EBITDA however, was not as positive, falling 10.7% on an annual basis to EUR30.1m. The revenue margin is reduced to 35.4%.
