Kindred has proudly announced robust Q2 results, showcasing a 7% year-on-year revenue increase to £327.6 million. Excluding its North American operations, which were finalized in Q2, the revenue growth stood at an impressive 8%. This success underscores Kindred’s strategic focus on key markets, leading to a substantial uplift in their financial performance.
Kindred’s underlying EBITDA for the quarter surged to £73.6 million, marking a 32% increase compared to Q2 2023. The profit before tax also experienced a significant rise, reaching £55.6 million, which represents a remarkable 68% growth. This robust performance was attributed to the company’s strategic concentration on key markets, resulting in an EBITDA margin of 22%.
The operator’s revenue from gross winnings rose by 6% year-on-year, or 12% when North America is excluded, reaching £208.4 million. This growth was fueled by exceptional expansion in locally regulated markets. Notably, Kindred’s overall performance was bolstered by impressive growth in revenue across Western Europe, with the Netherlands up 17%, Belgium up 12%, and France witnessing a phenomenal 41% increase.
In France, active customers surged by 26%, with Kindred CEO Nils Anden highlighting the company’s success in capturing market share in the country during the quarter. The launch of an updated Unibet app and enhancements in user experience significantly strengthened Kindred’s position in France.
Despite these gains, Kindred faced new regulatory measures in the UK, which slowed growth to 4% during Q2. The company anticipates this trend to persist but believes it has performed in line with market expectations. In Sweden, the regulatory landscape remains challenging, with a 3% drop in gross winnings revenue due to increased affordability checks introduced in 2023. Nevertheless, Kindred is optimistic about regaining market share, noting early signs of improvement.
Sweden is considering various new measures to tighten its gambling regulations, including an increase in its gambling tax rate from 18% to 22% of Gross Gaming Revenue (GGR).
The start of the Euros tournament at the end of the quarter positively impacted overall sports betting revenue, which rose by 18%. A higher-than-average betting margin in France positively influenced the group’s overall betting margin, reported at 13.3% before free bets and 12.1% after free bets. Kindred noted a preference for higher-margin products during this period, including its popular bet builder offering.
Kindred’s CEO, Nils Anden, also credited the improved quarterly results to lower marketing costs and a better return on investment (ROI). Marketing expenses as a share of revenue decreased from 9.9% in Q2 2023 to 8.4% this year, partly due to Kindred’s exit from the North American market.
Anden stated, “We have directed efforts on improving marketing efficiency and focusing investments in markets and channels that are most likely to deliver top-line growth.” This strategic approach has reaped significant results, enhancing Kindred’s overall financial performance and market positioning.
In summary, Kindred’s Q2 results reflect the company’s strategic focus and market strength, with significant gains in key regions and improved financial metrics. As the company navigates regulatory challenges and leverages opportunities in local markets, its commitment to growth and efficiency remains evident.
