Intralot reported a year-on-year decline in revenue, EBITDA and net profit during the nine-month period to the end of September, with the group again blaming economic issues in Argentina for the declines.
Total revenue for the period hit €263.5 million (£218.2 million/$276.8 million), according to figures published by Intralot. This is 5.9% less than the €280 million reported by Intralot during the same nine months last year.
On top of this, Intralot also saw gross gaming revenue drop 4.7% to €249.8 million, with the group laying most of the blame on exchange rate movement in Argentina in December 2023.
This echoes comments made in relation to both H1 and Q1 for the current year. Economic reforms in the country in late 2023 played havoc with the exchange rate, with this impacting Intralot’s overall performance in 2024. Total negative impact on overall revenue in Argentina was €12.6 million in the nine-month period.
Lottery leads the way for Intralot
Lottery games drew 56.7% of revenue, with sports betting at 21.8%, video lottery terminals 11.9% and IT products and services 9.6%. Meanwhile, management, technology and support services (B2B/B2G) accounted for 90.8% of total revenue and B2C licensed operations in Argentina 9.2%.
Breaking this down, revenue from management contracts increased 6.5%, helped by local market growth and market share uptake in Turkey. This, Intralot said, was despite the devaluation of the Turkish lira and lower recorded revenue in Morocco.
However revenue from technology and support services, the other part of the B2B/B2G segment fell 5.7%. Intralot put this down to a one-off sale in Taiwan during the same period last year, the Argentina exchange rate and a 2.9% drop in US sales.
In addition, licensed B2C operations revenue dipped by 26.6% due to currency translation in Argentina. On a local currency basis, current year results are 114.6% higher year-on-year.
As for geographical performance, most revenue – €157.6 million – came from the Americas. This, however, is 9.4% less than last year. Europe revenue also fell 31.9% to €51 million.
Other markets drew €70.6 million in revenue, 6.5% above last year. Intralot also noted €15.6 million worth of eliminations from cross-market revenue.
Bottom line net profit down 28.2%
Revenue decline meant gross profit for the nine-month period also fell 7.2% to €99.5 million. After accounting for €22.1 million in other operating income and €82.7 million in operating expenses, this left €91.5 million in EBITDA, a 9.4% year-on-year decline.
Operating profit – after depreciation and amortisation and certain other costs – declined by 29.2% to €37.2 million. After also including non-operating expenses, pre-tax profit dropped 67.1% to €10.6 million.
After tax, bottom-line net profit was €6.5 million, down 28.2% from last year.
“Intralot’s performance for the nine-month period in 2024 has been impacted by seasonality effects in the US and FX movements,” Intralot chairman Sokratis Kokkalis said. “The company maintains its key metrics of profitability and leverage ratio within the targeted range, while extending existing contracts and participates through tender process in a large number of projects around the world.”
What about Q3 at Intralot?
The publication also shed light on Intralot in Q3. Total revenue fell 14.2% to €89.9 million, while gross gaming revenue declined 14.3% to €84.5 million.
Gross profit was down 23.3% to €34 million, while despite lower operating costs, EBITDA in Q3 slipped 16.3% to €32 million.
Operating profit was 34.3% lower at €14.1 million and pre-tax profit slumped 71.6% to €4.5 million. This was mainly due to a significant gain in the previous year.
After tax, net profit for Q3 at Intralot hit €1.9 million, a drop of 59.1%.
Intralot face DC lottery probe
The results come on the back of reports that Intralot is facing a probe over its DC lottery and sports betting contract. The District’s attorney general’s office is said to be looking into the agreement, according to new reporting.
Axios cited anonymous sources saying that attorney general Brian Schwalb’s office requested more information related to the contract last summer. It is unclear if the probe centres on Intralot specifically or a subcontractor.
Intralot has run the DC Lottery since 2009. In 2019, it was also awarded a $215 million no-bid contract to run online sports betting. The platform it rolled out, GambetDC, never lived up to expectations and the brand was eventually replaced by FanDuel earlier this year.
