Sun International is focusing on enhancing its SunBet product following a robust first half performance. The company announced a remarkable 35.5% increase in SunBet revenue, reaching R1.18 billion ($73.6 million), significantly surpassing the 19% growth of South Africa's online market during that period.
Excluding revenue from the Table Bay Hotel, where it operates under a management agreement with IHG, Sun International's overall group income rose by 7.4% to R6.58 billion in the first half of the year.
During its Capital Markets Day in March, Sun International detailed plans to double SunBet's share of the South African online market, which currently stands at 4.5%. Although the company did not provide updates on market share since March, CEO Bengtsson emphasized the importance of product enhancements for future growth during the post-H1 earnings call.
Bengtsson hinted at both local and international expansion opportunities, stating, "We view plenty of inorganic opportunities around the business." He expressed openness to consolidating minority stakes and indicated potential for growth beyond South Africa.
SunBet began operations in Namibia in May, utilizing Bede Gaming's platform, which also powers its services in South Africa and Botswana. Plans for further expansion are being assessed in Zambia, Kenya, and Ghana.
The company recently introduced a new user interface for SunBet in South Africa and Botswana, with Bengtsson noting ongoing improvements to enhance user experience. He stated, "We had a very strong World Cup, showing that our sportsbook can handle larger volumes, though we are not yet where we want to be. More developments are planned for the remainder of the year."
When discussing the balance between casino and sports betting at SunBet, which currently sits at 90% and 10%, respectively, Bengtsson acknowledged that the company lags in sportsbook offerings. He sees great potential in this segment, stating, "The market overall is probably around 35%-40% sportsbook, indicating the gap we need to close with better product offerings."
He also highlighted the ongoing momentum from the recent World Cup, describing it as a significant customer acquisition period, even as July yielded lower sportsbook activity due to most football leagues being on break.
In addition to SunBet’s advancements, Sun International reported a return to growth for its land-based casino segment, with revenue increasing 1.5% to R3.42 billion—the first growth in three years. However, land-based gross profit experienced a minor decline of 0.7% to R2 billion, although investments in this segment have risen.
Bengtsson believes recent revenue gains will lead to better operating leverage in the casino business going forward, asserting, "The sustainability in our operational improvements and market share gains is real."
The CEO noted the synergies between land-based and online operations, highlighting the potential of capturing more online activity from existing customers. He stated, "SunBet probably wouldn’t be where it is today without a land-based business, and vice versa. We continuously leverage one another's strengths, and we see an opportunity to convert more of our land-based customers to play online at SunBet."
