Allwyn reported an increase of 98% in its total revenues to EUR2.01bn ($2.17bn/£1.72bn) in Q3, largely due to the acquisitions it made earlier this year, including Camelot UK.
Allwyn has seen a major impact from the double addition, as revenue in Q3 almost doubled year on year to EUR368.4m. The period saw higher earnings, while the adjusted free cashflow was 10 percent higher.
In February, the group acquired Camelot UK Ltd, which operates UK National Lottery. Allwyn will take control of the UK National Lottery in February of next year, under the 4th National Lottery license.
Allwyn acquired Camelot Lottery Solutions, (Camelot LS), earlier in 2023. Allwyn North America, the US-facing company has been rebranded to reflect this purchase.
Robert Chvatal, Allwyn’s CEO said that he is pleased with the progress made by all of its companies. The Q3 results, he said, show that Allwyn has a good chance of growth for Q4 and beyond.
Chvatal stated, “I’m pleased to announce that Allwyn has delivered another solid quarter in terms of financial performance and progress. This is despite headwinds due to customer-friendly sport results which impacted on the overall sports betting industry as well as less favorable jackpot cycles.”
The total revenue in Q3 of 2023 increased 98% compared to last year, driven by a stable performance across our geographies and the contribution made from the Camelot purchases that were completed in the 1st quarter.
Our cost structure was favourable and we continued to generate solid margins. Inflation had a minimal impact on our costs. “Our largest cost categories are directly related to our revenue, and we focus on capital and cost efficiency.”
Allwyn’s gross gaming revenues up by 98%
Allwyn has not published the full results of its preliminary quarter-end to September 30. It does, however, provide an indication of the revenue performance during this quarter.
The Q3 gross gaming revenues were 98% more than the previous quarter, at EUR1.92bn. This was based again on the entire business including Camelot UK, Camelot LS, and other operations. The net revenue, which is the total revenue less gaming taxes and contributions to good causes, also grew by 38%.
The total quarter revenue, excluding the acquisition of double Camelot, was EUR1.01bn. This is a 1% decrease. Net revenue fell 1%, to EUR636.1m. Gross gaming revenue was flat at EUR965.2m.
Allwyn, focusing on the data without the acquisitions said that growth in the sector was affected by sports results which were favourable to customers. The industry was affected by unfavorable jackpot cycles. Jackpots were won in key games before they grew to a size that attracted less frequent players. Allwyn gave as an example the EuroMillions Jackpot reaching a new record in the third quarter of 2022.
UK revenue makes up nearly half of the Q3 total
Allwyn’s core market is the UK, by a considerable margin. The total revenue for the UK was EUR956.5m in Q3, which is 12% less than it was last year due to a weaker performance in numerical lotteries, and shorter EuroMillions Jackpot cycles.
Allwyn UK is set to take over the UK National Lottery operations from Camelot UK at 1 February 2024. Allwyn reported certain costs associated with the preparations to transition to a new license.
The total revenue for the segment Greece and Cyprus fell 4%, to EUR503.4m. Allwyn attributed this to the unfavorable rollover of jackpots, sports results that were more customer-friendly, and sudden natural events such as the fires in Greece which affected the availability of certain points of sales (POS).
Allwyn has seen growth in its regional online channel. It reported higher gross gaming revenues year-onyear, reflecting stronger performance in igaming and the introduction of new games.
It was good news for Italy as well, where total revenues were up by 8% on a year-on-year basis to EUR554.0m.
Austria is affected by the loss of Casino Licence in Germany
Austria, on the other hand, reported growth. This was aided by good performances in casinos, instant lotteries, video lottery terminals, and igaming. The total revenue was EUR379.9m, up by 2%.
Allwyn said, however, that the numerical lotteries performed somewhat worse. The EuroMillions jackpot cycle was shorter, and the previous year’s record-breaking rollover also contributed to this.
Allwyn noted that the license to operate 10 casino in Lower Saxony, Germany had been awarded post-quarter end to a rival. This activity was reported in Austria for VLTs, casinos and other gaming machines. The license expires in August 2024.
Group revenue in the Czech Republic was up by 6%, to EUR123.1m. Allwyn explained that this was due to a good top-line organic growth in all of the major products. It noted in particular a good performance from instant lotteries, and online gaming.
The US Allwyn LS Group’s business generated EUR46.5m total revenue during Q3. This was a 12% increase. The business’s strong performance was due primarily to the Illinois Lottery.
The year-to-date revenue consolidated tops EUR5,70bn
Allwyn didn’t disclose any further information in regards to costs or profits. Allwyn did, however, break down the performance of its current year. The total revenue in the nine-month period ending 30 September was EUR5,70bn. This is up by 98% compared to last year, when EUR2,88bn.
The gross gaming revenue increased by 99%, to EUR5.47bn. Net revenue rose 43% at EUR2.60bn. Groupe d’entreprises also reported that the adjusted EBITDA grew by 26%, to EUR1.10bn. The adjusted free cashflow jumped 23%, to EUR1.02bn.
Even without the Camelot purchases, revenue in total was 7% higher. It reached EUR3.09bn. Gross gaming revenue was EUR2,97bn, an 8% increase, and net revenue increased 8% to EUR1,97bn.
The adjusted EBITDA increased by 11%, to EUR968.5m. Adjusted free cash flow increased 8%, to EUR901.2m.
Chvatal stated that despite sector headwinds, “I am pleased to see Allwyn continue its progress. I believe it is well positioned for a successful 2023 and the next chapters in our growth story.”
