NEW YORK--(BUSINESS WIRE)--Super Group (SGHC) Limited (NYSE: SGHC) ("SGHC" or "Super Group"), the parent company of Betway, a leading online sports betting and gaming business, and Spin, the multi-brand online casino, today announced third quarter 2024 unaudited consolidated financial results.
Neal Menashe, Chief Executive Officer of Super Group, commented: "We achieved our strongest third quarter ever, highlighting the phenomenal progress we are making as a business. There is still tremendous potential as we experience super growth across our global casino brands, and particularly in Africa which we have scaled to be our largest region for the second quarter running. Given our continued strong performance and robust balance sheet, we are exploring ways to return excess cash to shareholders, and intend to discuss with the board a possible further special dividend before the end of the year."
Alinda van Wyk, Chief Financial Officer of Super Group, stated: "This quarter was our best ex-US third quarter ever, achieving total revenue of €395 million and Adjusted EBITDA of €95 million. We are focusing on consistent growth in our key markets, while striving to maximize operational and marketing cost efficiencies across the group, which resulted in a margin of 24% for the second quarter in a row - well ahead of our long-term target of 20%. Following the strong performance of the business over the first three quarters and an early look at a strong October, we are increasing our ex-US Adjusted EBITDA full-year 2024 guidance to be greater than €345 million."
Financial Highlights:
- Revenue increased by 13% to €402.9 million for the third quarter of 2024 (constant currency: 15% to €410.9 million) from €356.9 million in the same period of the prior year, driven by growth from the Africa, Europe and North America (predominantly Canada) markets partially offset by declines from the Middle East and Asia-Pacific markets.
- Profit for the period was €8.5 million for the third quarter of 2024. Profit for the period of €10.6 million for the third quarter of 2023 included a non-cash charge of €14.2 million related to the change in fair value of option liability.
- Adjusted EBITDA, a non-GAAP measure, increased by 60% to €83.9 million for the third quarter of 2024 compared to €52.5 million in the third quarter of 2023.
- Monthly Active Customers increased by 17% to 4.7 million during the third quarter of 2024 from 4.0 million in the third quarter of 2023.
- Cash and cash equivalents was €296.6 million at September 30, 2024, up from €241.9 million at December 31, 2023. This net increase during the nine months ended September 30, 2024 was the result of:
- Inflows from operating activities amounting to €159.1 million;
- Outflows from investing activities of €59.2 million. This was mainly as a result of further investment in tangible and intangible assets of €63.6 million, predominantly due to the capitalization of expenditure on software, issuance of a loan to Apricot Investments Limited of €10.0 million, deferred consideration paid of €2.5 million relating to the 15 Marketing Limited acquisition and cash paid of €2.0 million for an investment in associate. These outflows were offset in part by €9.2 million of consideration received from the sale of the B2B division of DGC, as well as €9.2 million resulting from receipts of interest and repayment of loans receivable;
- Outflows from financing activities of €51.9 million, mainly due to dividends paid of €46.1 million and lease payments of €5.7 million; and
- A gain of €6.7 million as a result of foreign currency fluctuations on foreign cash balances held over this period.
Revenue by Geographical Region for the Three Months Ended September 30, 2024 in € '000s:
Betway | Spin | Total | |
Africa and Middle East | 150,171 | 1,000 | 151,171 |
Asia-Pacific | 5,139 | 28,577 | 33,716 |
Europe | 47,018 | 20,374 | 67,392 |
North America | 33,796 | 110,997 | 144,793 |
South/Latin America | 3,245 | 2,536 | 5,781 |
Total revenue | 239,369 | 163,484 | 402,853 |
% | % | % | |
Africa and Middle East | 63 % | 1 % | 38 % |
Asia-Pacific | 2 % | 17 % | 8 % |
Europe | 20 % | 12 % | 17 % |
North America | 14 % | 68 % | 36 % |
South/Latin America | 1 % | 2 % | 1 % |
Revenue by Geographical Region for the Three Months Ended September 30, 2023 in € '000s:
Betway | Spin | Total | |
Africa and Middle East | 99,381 | 673 | 100,054 |
Asia-Pacific | 35,014 | 26,968 | 61,982 |
Europe | 34,823 | 19,197 | 54,020 |
North America | 33,645 | 100,443 | 134,088 |
South/Latin America | 3,538 | 3,206 | 6,744 |
Total revenue | 206,401 | 150,487 | 356,888 |
% | % | % | |
Africa and Middle East | 48 % | 0 % | 28 % |
Asia-Pacific | 17 % | 18 % | 17 % |
Europe | 17 % | 13 % | 15 % |
North America | 16 % | 67 % | 38 % |
South/Latin America | 2 % | 2 % | 2 % |
Revenue by Geographical Region for the Nine Months Ended September 30, 2024 in € '000s:
Betway | Spin | Total | |
Africa and Middle East | 442,201 | 2,283 | 444,484 |
Asia-Pacific | 19,805 | 85,971 | 105,776 |
Europe | 130,937 | 59,623 | 190,560 |
North America | 104,408 | 331,369 | 435,777 |
South/Latin America | 10,233 | 10,021 | 20,254 |
Total revenue | 707,584 | 489,267 | 1,196,851 |
% | % | % | |
Africa and Middle East | 62 % | 0 % | 37 % |
Asia-Pacific | 3 % | 18 % | 9 % |
Europe | 19 % | 12 % | 16 % |
North America | 15 % | 68 % | 36 % |
South/Latin America | 1 % | 2 % | 2 % |
Revenue by Geographical Region for the Nine Months Ended September 30, 2023 in € '000s:
Betway | Spin | Total | |
Africa and Middle East | 296,834 | 1,425 | 298,259 |
Asia-Pacific | 111,205 | 77,888 | 189,093 |
Europe | 105,831 | 61,143 | 166,974 |
North America | 108,889 | 292,510 | 401,399 |
South/Latin America | 10,871 | 9,602 | 20,473 |
Total revenue | 633,630 | 442,568 | 1,076,198 |
% | % | % | |
Africa and Middle East | 46 % | 0 % | 27 % |
Asia-Pacific | 18 % | 18 % | 18 % |
Europe | 17 % | 14 % | 16 % |
North America | 17 % | 66 % | 37 % |
South/Latin America | 2 % | 2 % | 2 % |
Revenue by product line for the Three Months Ended September 30, 2024 in € '000s:
Betway | Spin | Total | |
Online casino1 | 166,878 | 163,281 | 330,159 |
Sports betting1 | 67,136 | - | 67,136 |
Brand licensing2 | 3,653 | - | 3,653 |
Other3 | 1,702 | 203 | 1,905 |
Total revenue | 239,369 | 163,484 | 402,853 |
Revenue by product line for the Three Months Ended September 30, 2023 in € '000s:
Betway | Spin | Total | |
Online casino1 | 126,891 | 150,215 | 277,106 |
Sports betting1 | 64,566 | - | 64,566 |
Brand licensing2 | 8,294 | - | 8,294 |
Other3 | 6,650 | 272 | 6,922 |
Total revenue | 206,401 | 150,487 | 356,888 |
Revenue by product line for the Nine Months Ended September 30, 2024 in € '000s:
Betway | Spin | Total | |
Online casino1 | 460,909 | 488,385 | 949,294 |
Sports betting1 | 224,485 | 60 | 224,545 |
Brand licensing2 | 14,781 | - | 14,781 |
Other3 | 7,409 | 822 | 8,231 |
Total revenue | 707,584 | 489,267 | 1,196,851 |
Revenue by product line for the Nine Months Ended September 30, 2023 in € '000s:
Betway | Spin | Total | |
Online casino1 | 350,711 | 441,812 | 792,523 |
Sports betting1 | 240,213 | 44 | 240,257 |
Brand licensing2 | 25,441 | - | 25,441 |
Other3 | 17,265 | 712 | 17,977 |
Total revenue | 633,630 | 442,568 | 1,076,198 |
1 Sports betting and online casino revenues are not within the scope of IFRS 15 'Revenue from Contracts with Customers' and are treated as derivatives under IFRS 9 'Financial Instruments'. | |||
2 Brand licensing revenues are within the scope of IFRS 15 'Revenue from Contracts with Customers'. | |||
3 Other relates to profit share, royalties and outsource fees from external customers. | |||
Non-GAAP Financial Information
This press release includes non-GAAP financial information not presented in accordance with the International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board.
EBITDA, Adjusted EBITDA, Adjusted EBITDA, ex-US, Adjusted EBITDA, US and revenue on a constant currency basis are non-GAAP company-specific performance measures that Super Group uses to supplement the Company's results presented in accordance with IFRS. EBITDA is defined as profit before depreciation, amortization, finance income, finance expense and income tax expense. Adjusted EBITDA is EBITDA adjusted for RSU expense, change in fair value of options, unrealized foreign exchange, gain on disposal of business, impairment of assets, US sportsbook closure, market closure and other adjustments. Adjusted EBITDA, ex-US is Adjusted EBITDA relating to the rest the group, excluding Digital Gaming Corporation ('DGC'). Adjusted EBITDA, US is Adjusted EBITDA relating to the DGC. Constant currency revenue growth is calculated by translating non-Euro performance for 2023 and 2024 using 2023 exchange rates.
Super Group believes that these non-GAAP measures are useful in evaluating the Company's operating performance as they provide additional perspective on the financial performance of our core business, are similar to measures reported by the Company's public competitors and are regularly used by securities analysts, institutional investors and other interested parties in analyzing operating performance and prospects.
Management does not consider these non-GAAP measures in isolation or as an alternative to financial measures determined in accordance with IFRS. The principal limitation of these non-GAAP financial measures is that they exclude significant expenses that are required by IFRS to be recorded in Super Group's financial statements. In order to compensate for these limitations, management presents non-GAAP financial measures together with IFRS results. Non-GAAP measures should be considered in addition to results and guidance prepared in accordance with IFRS, but should not be considered a substitute for, or superior to, IFRS results.
Reconciliation tables of the most comparable IFRS financial measure to the non-GAAP financial measures used in this press release, other than revenue on a constant currency basis, and supplemental materials are included below. Super Group urges investors to review the reconciliation and not to rely on any single financial measure to evaluate its business. In addition, other companies, including companies in our industry, may calculate similarly named non-GAAP measures differently than we do, which limits their usefulness in comparing our financial results with theirs.
Reconciliation of Profit after taxation to EBITDA and Adjusted EBITDA
for the Three and Nine Months Ended September 30, in € '000s:
Three Months Ended
| Nine Months Ended
| |||||||
2024 | 2023 | 2024 | 2023 | |||||
Profit for the period | 8,464 | 10,626 | 48,528 | 36,262 | ||||
Income tax expense | 14,390 | 4,748 | 43,489 | 25,387 | ||||
Finance income | (2,345 | ) | (2,535 | ) | (8,017 | ) | (5,800 | ) |
Finance expense | 2,051 | 695 | 4,722 | 1,779 | ||||
Depreciation and amortization expense | 18,822 | 19,848 | 60,548 | 61,603 | ||||
EBITDA | 41,382 | 33,382 | 149,270 | 119,231 | ||||
Change in fair value of options | - | 14,217 | 12,838 | 22,495 | ||||
RSU expense | 973 | 5,803 | 8,123 | 14,429 | ||||
Unrealized foreign exchange | 3,047 | (907 | ) | 7,792 | 3,168 | |||
US Sportsbook closure | 32,749 | - | 32,749 | - | ||||
Market closure | 5,414 | - | 5,834 | - | ||||
Gain on disposal of business | - | - | (40,135 | ) | - | |||
Impairment of assets | - | - | 36,775 | - | ||||
Other adjustments1 | 355 | 9 | (1,049 | ) | 5,370 | |||
Adjusted EBITDA | 83,920 | 52,504 | 212,197 | 164,693 | ||||
Adjusted EBITDA, ex-US | 95,376 | 62,826 | 262,314 | 203,988 | ||||
Adjusted EBITDA, US | (11,456 | ) | (10,322 | ) | (50,117 | ) | (39,295 | ) |
1 Adjusted EBITDA has been restated for the prior period presented to include other adjustments. Other adjustments in 2023 includes bad debt and SOX implementation fees relating to new acquisitions. | ||||||||
Webcast Details
The Company will host a webcast at 8:30 a.m. ET today to discuss the third quarter 2024 financial results. Participants may access the live webcast and supplemental earnings presentation on the events & presentations page of the Super Group Investor Relations website at: https://investors.sghc.com/events-and-presentations/default.aspx.
About Super Group (SGHC) Limited
Super Group (SGHC) Limited is the holding company for leading global online sports betting and gaming businesses: Betway, a premier online sports betting brand, and Spin, a multi-brand online casino offering. Listed on the New York Stock Exchange (NYSE ticker: SGHC), the Group is licensed in multiple jurisdictions, with leading positions in key markets throughout Europe, the Americas and Africa. The Group's successful sports betting and online gaming offerings are underpinned by its scale and leading technology, enabling fast and effective entry into new markets. Super Group has been ranked no. 6 in the EGR Power 50 for the last two years. For more information, visit www.supergroup.com.
Forward-Looking Statements
Certain statements made in this press release are "forward looking statements" within the meaning of the "safe harbor" provisions of the United States Private Securities Litigation Reform Act of 1995.
These forward-looking statements include, but are not limited to, Super Group's intention to pay a possible special dividend, including the expected timing of such dividend, expectations and projections of market opportunity, growth and profitability, and expectations for the remainder of 2024, including ex-US Adjusted EBITDA guidance for the full year 2024.
These forward-looking statements generally are identified by the words "believe," "project," "expect," "anticipate," "estimate," "intend," "strategy," "future," "opportunity," "plan," "pipeline," "possible," "may," "should," "will," "would," "will be," "will continue," "will likely result," and similar expressions. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Many factors could cause actual future events to differ materially from the forward-looking statements in this press release, including but not limited to: (i) the ability to implement business plans, forecasts and other expectations, and identify and realize additional opportunities; (ii) changes in the competitive and regulated industries in which Super Group operates; (iii) variations in operating performance across competitors; (iv) changes in laws and regulations affecting Super Group's business; (v) Super Group's inability to meet or exceed its financial projections; (vi) changes in general economic conditions; (vii) changes in domestic and foreign business, market, financial, political and legal conditions; (viii) the ability of Super Group's customers to deposit funds in order to participate in Super Group's gaming products; (ix) Super Group's ability, and the ability of Super Group's key executives, certain employees, significant shareholders or other applicable individuals, to comply with regulatory requirements or successfully obtain a license or permit required in a particular regulated jurisdiction, or maintain, renew or expand existing licenses; (x) the effectiveness of technological solutions Super Group has in place to block customers in certain jurisdictions, including jurisdictions where Super Group's business is illegal, or which are sanctioned by countries in which Super Group operates from accessing its offerings; (xi) Super Group's ability to restrict and manage betting limits at the individual customer level based on individual customer profiles and risk level to the enterprise; (xii) Super Group's ability to protect or enforce its intellectual property rights, the confidentiality of its trade secrets and confidential information, or the costs involved in protecting or enforcing Super Group's intellectual property rights and confidential information; (xiii) compliance with applicable data protection and privacy laws in Super Group's collection, storage and use, including sharing and international transfers, of personal data; (xiv) failures, errors, defects or disruptions in Super Group's information technology and other systems and platforms; (xv) Super Group's ability to develop new products, services, and solutions, bring them to market in a timely manner, and make enhancements to its platform; (xvi) Super Group's ability to maintain and grow its market share, including its ability to enter new markets and acquire and retain paying customers; (xvii) the success, including win or hold rates, of existing and future online betting and gaming products; (xiii) competition within the broader entertainment industry; (xix) Super Group's reliance on strategic relationships with land based casinos, sports teams, event planners, local licensing partners and advertisers; (xx) events or media coverage relating to, or the popularity of, online betting and gaming industry; (xxi) trading, liability management and pricing risk related to Super Group's participation in the sports betting and gaming industry; (xxii) accessibility to the services of banks, credit card issuers and payment processing services providers due to the nature of Super Group's business; (xxiii) the regulatory approvals related to proposed acquisitions and the integration of the acquired businesses; and (xxiv) other risks and uncertainties indicated from time to time for Super Group including those under the heading "Risk Factors" in our Annual Report on Form 20-F filed with the SEC on April 25, 2024, and in Super Group's other filings with the SEC. The foregoing list of factors is not exhaustive. You should carefully consider the foregoing factors and the other risks and uncertainties described in other documents filed or that may be filed by Super Group from time to time with the SEC. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Forward-looking statements speak only as of the date they are made. Readers are cautioned not to put undue reliance on forward-looking statements, and Super Group assumes no obligation and does not intend to update or revise these forward-looking statements, whether as a result of new information, future events, or otherwise. Super Group does not give any assurance that it will achieve its expectations.
Super Group (SGHC) Limited
Unaudited Consolidated Statements of Profit or Loss and Other Comprehensive Income
for the Three and Nine Months Ended September 30, 2024 and 2023
(€ in '000s, except for shares and profit per share)
Three Months Ended
| Nine Months Ended
| ||||||||||
2024 | 2023 | 2024 | 2023 | ||||||||
Revenue | 402,853 | 356,888 | 1,196,851 | 1,076,198 | |||||||
Direct and marketing expenses | (320,474 | ) | (270,839 | ) | (923,601 | ) | (823,879 | ) | |||
General and administrative expenses | (41,367 | ) | (38,810 | ) | (119,335 | ) | (113,262 | ) | |||
Other operating income | 95 | 360 | 4,407 | 2,669 | |||||||
Gain on disposal of business | - | - | 40,135 | - | |||||||
Depreciation and amortization expense | (18,822 | ) | (19,848 | ) | (60,548 | ) | (61,603 | ) | |||
Impairment of assets | - | - | (36,775 | ) | - | ||||||
Finance income | 2,345 | 2,535 | 8,017 | 5,800 | |||||||
Finance expense | (2,051 | ) | (695 | ) | (4,722 | ) | (1,779 | ) | |||
Change in fair value of options | - | (14,217 | ) | (12,838 | ) | (22,495 | ) | ||||
Share of post-tax profit of equity accounted associate | 275 | - | 426 | - | |||||||
Profit before taxation | 22,854 | 15,374 | 92,017 | 61,649 | |||||||
Income tax expense | (14,390 | ) | (4,748 | ) | (43,489 | ) | (25,387 | ) | |||
Profit for the period | 8,464 | 10,626 | 48,528 | 36,262 | |||||||
Profit / (loss) for the period attributable to: | |||||||||||
Owners of the parent | 8,360 | 9,876 | 48,650 | 34,050 | |||||||
Non-controlling interest | 104 | 750 | (122 | ) | 2,212 | ||||||
8,464 | 10,626 | 48,528 | 36,262 | ||||||||
Other comprehensive income items that may be reclassified subsequently to profit | |||||||||||
Foreign currency translation | 3,556 | 5,251 | 19,211 | 4,459 | |||||||
Other comprehensive income for the period | 3,556 | 5,251 | 19,211 | 4,459 | |||||||
Total comprehensive profit for the period | 12,020 | 15,877 | 67,739 | 40,721 | |||||||
Total comprehensive profit / (loss) for the period attributable to: | |||||||||||
Owners of the parent | 11,916 | 15,127 | 67,861 | 38,509 | |||||||
Non-controlling interest | 104 | 750 | (122 | ) | 2,212 | ||||||
12,020 | 15,877 | 67,739 | 40,721 | ||||||||
Weighted average shares outstanding, basic | 502,015,727 | 498,360,431 | 501,345,672 | 498,336,881 | |||||||
Weighted average shares outstanding, diluted | 504,156,731 | 500,333,127 | 503,001,771 | 500,478,521 | |||||||
Profit per share, basic (cents) | 1.67 | 1.98 | 9.70 | 6.83 | |||||||
Profit per share, diluted (cents) | 1.66 | 1.97 | 9.67 | 6.80 | |||||||
Super Group (SGHC) Limited
Consolidated Statements of Financial Position
as at September 30, 2024 and December 31, 2023
(€ in '000s)
Unaudited | ||||||
2024 | 2023 | |||||
ASSETS | ||||||
Non-current assets | ||||||
Intangible assets | 163,965 | 193,395 | ||||
Goodwill | 89,458 | 94,915 | ||||
Property, plant and equipment | 16,742 | 17,406 | ||||
Right-of-use assets | 65,998 | 24,866 | ||||
Deferred tax assets | 43,150 | 36,703 | ||||
Regulatory deposits | 12,923 | 11,951 | ||||
Loans receivable | 48 | 89,090 | ||||
Investment in associate | 2,579 | - | ||||
Financial assets, including derivative | 452 | 174 | ||||
Prepayment for sportsbook software1 | 102,437 | - | ||||
497,752 | 468,500 | |||||
Current assets | ||||||
Trade and other receivables | 142,874 | 154,615 | ||||
Loans receivable | 5,093 | 6,719 | ||||
Income tax receivables | 380 | 12,535 | ||||
Restricted cash | 37,910 | 38,287 | ||||
Cash and cash equivalents | 296,626 | 241,923 | ||||
Assets held for sale | - | 38,292 | ||||
482,883 | 492,371 | |||||
TOTAL ASSETS | 980,635 | 960,871 | ||||
Non-current liabilities | ||||||
Lease liabilities | 64,997 | 23,919 | ||||
Deferred tax liability | 2,258 | 4,684 | ||||
Derivative financial instruments | 2,058 | 2,056 | ||||
Provisions | 1,078 | - | ||||
Contingent consideration | - | 322 | ||||
70,391 | 30,981 | |||||
Current liabilities | ||||||
Lease liabilities | 5,320 | 5,226 | ||||
Interest-bearing loans and borrowings | 32 | 87 | ||||
Deferred and contingent consideration | 338 | 2,392 | ||||
Trade and other payables | 241,672 | 195,392 | ||||
Customer liabilities | 57,072 | 67,592 | ||||
Provisions | 6,987 | 44,826 | ||||
Income tax payables | 30,913 | 25,840 | ||||
Derivative liability associated with assets held for sale | - | 42,600 | ||||
Liabilities associated with assets held for sale | - | 7,140 | ||||
342,334 | 391,095 | |||||
TOTAL LIABILITIES | 412,725 | 422,076 | ||||
EQUITY | ||||||
Issued capital | 289,753 | 289,753 | ||||
Treasury shares | (2,632 | ) | (2,632 | ) | ||
Accumulated other comprehensive profit / (deficit) | 11,788 | (7,424 | ) | |||
Retained profit | 250,668 | 240,618 | ||||
Equity attributable to owners of the parent | 549,577 | 520,315 | ||||
Non-controlling interest | 18,333 | 18,480 | ||||
SHAREHOLDERS' EQUITY | 567,910 | 538,795 | ||||
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | 980,635 | 960,871 | ||||
1 The Prepayment for sportsbook software relates to a reclassification of the loan receivable from Apricot Investments Limited. This reclassification has been made to reflect the latest position with regards to the proposed acquisition of the Sportsbook Technology Platform. | ||||||
Contacts
Investors:
investors@sghc.com
Media:
media@sghc.com
