Evolution Q2 results: Net revenue up 3.1% despite dip in profits
Evolution has reported moderate growth in its Q2 Interim Report.
Key points:
– Net revenue exhibits year-on-year increase of 3.1%
– Profits down 7.7% for Q2 compared to same period last year
– Supplier expresses optimism and is sticking to its full-year estimate of an EBITDA margin of 66-68%
As Evolution’s offering has expanded into new and different regulatory climates, financial growth has decelerated for the global provider.
The gaming supplier has been extending its influence further into Asian and LatAm markets in past months and has pointed towards proactive regulatory action in Europe and cybercrime in Asia as mitigating factors for unexceptional results.
Modest increases in overall revenue can be seen in its overall iGaming revenue, with profits slightly down on what they were over the same period last year.
CEO Martin Carlesund has offered words of reassurance to investors, suggesting that the Q2 results fall roughly in line with what they expected given the challenges of the Asian market: “To be clear though, we are not satisfied with this quarter’s growth, and we are working hard to increase the pace. However, operationally speaking we are where we set out to be at the beginning of the year.”
Net revenues are up by 3.1% for Q2 with EBITDA amounting to €345.3m.
Profits for the period came to 248.3m , compared to 269.1m for Q2 last year.
The Evolution chief attributes some the negative growth experienced in Europe to their policy of ringfencing.
After a UK Gambling Commission investigation found that some of Evolution’s games were accessible through unlicensed illegal operators the company responded by disabling access for the identified websites.
While recognising the positive long-term effects of regulation, he cautioned: “that the structure of the regulatory parameters is vital. A too heavily regulated market will cause a decrease in player protection and a reduced market for regulated companies.”
Despite the results, Evolution has announced it will be sticking with its full-year estimate of an EBITDA margin of 66-68%.
Good to know: Earlier in the year when the UKGC first started investigating Evolution for potential black market activity, the company’s share price fell 11.8%
The roadmap for 2025 includes 110 new releases that they will hope to drive that growth with, with three new live casino games to come in Q3.
The company opened its first Asian studio in June, and the CEO comments claim that it, along with the new base in Brazil are indicative of the growth that is yet to come and they remain optimistic about possibilities in both regions.
Recent significant events that took place after the reporting period ended for Q2 include the licensing agreement with Hasbro, the studio launch in Sao Paulo and the Rhode Entry market entry.
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