Sweden’s Aktiebolaget Trav och Galopp (ATG) has pointed to growth in its horse racing sector as the key driver in reaching SEK1.3bn (PS95.7m/EUR111.7m/$119.8m) in net gaming revenue (NGR) during Q1.
ATG’s revenue is its highest ever in Q1 and it has increased by 9.2% compared to the same quarter of last year when the company reported SEK1,19bn.
This revenue increase was due to the horse racing division of ATG, responsible for SEK968m or 74.5%, in NGR. This figure is also 13.3% higher than the SEK854m NGR that the horse racing segment racked up in Q1 of 2023.
In Q1, the casino sector also saw a 13.8% increase in NGR, with SEK165m generated. Horse racing and the casino sector saw a growth of 13.8% year-on-year, with SEK165m generated in Q1.
ATG attributes poor performance in sports betting to the “player-friendly” sporting results of the third quarter.
Lotta Viitala is ATG’s Chief Financial Officer. She believes that the Q1 results were strong, considering the recession. Viitala explained why the growth of horse racing was so important to ATG.
Viitala stated that “in addition to the positive calendar effect of an earlier Easter weekend, there were more jackpots in our main gaming brands this year than at the same time last year.” In horse racing we had also a poor Q1 in 202023 and a good first quarter of 2024. This contributed to the large increase.
ATG must continue to be the leading force of the Swedish Horse Industry.
costs also increase for ATG during Q1
The total revenue in Q1 was SEK1.5bn. This is up 9% compared to Q1 2023. The costs have risen by SEK50m, to SEK1.1bn (including tax).
ATG explained the cost increase by citing its higher NGR, and how it affected taxation rights, commissions as well as costs. It also stated that equestrian rights and information are the second most expensive item after tax, a cost that rises when betting on horse races increases as it did in Q1.
ATG’s Q1 operating profit was SEK389m, an increase of SEK72m over the previous quarter, and operating margin increased from 23% up to 26%.
Viitala says that the number of ATG customers has increased from 1.3 to 1.4 millions. This means ATG is more responsible to safeguard its clients from irresponsible behavior.
Viitala added, “We are committed to our customers at ATG and we want them to feel comfortable with their gambling.” We continue to explore different methods of gambling responsibility.
Strong 2023 to carry on despite threats from black market
ATG’s upward growth trajectory that was displayed in 2023 is set to continue, as evidenced by a strong Q1 report. ATG’s net profit in 2018 was SEK 1,45bn, an increase of 7.5% over 2022. The net gaming revenues also increased by 0.9%, to SEK5,27bn.
ATG also noted that the “worrisome” rate of channelisation in Sweden could be a threat.
In its Q4 report, the channelisation rate for igaming was estimated to be between 69% and 82%. These numbers are far below the Swedish Government’s 90% target.
ATG has also noted that the visitor traffic of unlicensed operators has increased by ten times since 2019.
