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Operating revenues increased 9.3% from SEK $393m ($46.25m) to SEK $430m ($50.6m). Growth could have been 10.4% when excluding SEK $6m ($710,000) in severance pay for CEO Per Eriksson’s departure in March.
The CEO severance also explains the minor reduction in operating margin which fell from 32.2% in 2017 to 31.2% in 2018.
The company’s earnings before interest and tax (EBIT) showed that their operating profits had increased from SEK $126.8m ($14.92m) to SEK $134.1m ($15.78m). NetEnt attributed this to performances in well regulated markets with Italy singled out as the most successful for growth.
However, increased operating expenses also rose from SEK $266m ($31.3m) to SEK $295m ($34.72m) due to newly launched products and currency effects. Norway took the brunt of the blame as the country had a negative impact on revenues in the quarter.
Commenting on the report, Therese Hillman, Acting President and CEO, said: “While NetEnt continues to focus on growth, measures were initiated in March to enable margin expansion going forward. Among other things, the Company is taking action to reduce costs. For the remainder of the year, we see conditions for better growth, supported primarily by regulated markets, more new games and new customers.”
The company had a busy first quarter introducing games in Mexico through Caliente, Live Beyond Live was launched with Mr Green who also signed a digital marketing service contract.
Hillman added: “For the remainder of the year, we see conditions for better growth, supported primarily by regulated markets, more new games and new customers. We continue to work on optimizing the organization and to make sure that revenues grow more than costs”.
