Allwyn nets 2X profit increase but 2021 landing blurred by Omicron headwinds

Allwyn Group (formerly SAZKA Group) has reported a strong trading performance for 2021 across multiple markets and verticals, with retail holdings experiencing an uptick following the lifting of restrictions during the first half of the year.

Updating investors in its third quarter interim trading update, the recently rebranded Czech multinational gambling group experienced a 51% year-on-year increase in consolidated gross gambling revenue to €2,142.6 million for the first nine months of 2021.

Additionally, adjusted EBITDA for the nine month period stood at €682.3, a 71% YoY increase, and consolidated adjusted cash flow was marked at €644.8 million. GGR for the third quarter, meanwhile, grew by 14% on the previous year to EUR 142.6 million with an EBITDA increase of 40% to €285.1 million and cash flow of €275.5 million.

During Q3, group consolidated revenues increased by 14% to €876 million. Of note Allwyn highlighted a transformative period for its OPAP unit, which became Greece’s leading online gambling operator, completing the full integration of Stoiximan.  

Coronavirus restrictions had enforced the shutdown of Allywn’s retail operations in Greece, Cyprus and Austria – among other international markets – but as measures were relaxed the holdings experienced a ‘very rapid recovery’ in line with the firm’s expectations.

Austrian performance was also positively impacted by a restructuring in the country, according to Group CEO Robert Chvatal, who detailed that the ‘successful execution’ of the programme ‘is expected to deliver annual savings of €45 million’.

This international performance across European regulated markets was bolstered by sales of Numerical Lottery and Instant Lottery tickets – particularly through online channels – as well as igaming operations.

​​Period trading saw Allwyn benefit from two ‘significant financing transactions’ as the group cashed-in on a €75 million equity contribution from its parent company ‘SAZKA Entertainment AG’  and further closed an €85 million bank loan facility.

Closing its Q3 accounts, Allwyn tracks YTD pre-tax profits of €325 million, up 245% on corresponding 2020 results of €94 million.  

Moving forward, Chvatal acknowledged that the imposition of new restrictions in some of the group’s active markets towards the end of the third quarter could pose new hurdles, such as in Austria.

However, he noted that these restrictions were ‘more limited than in previous periods’ and had already been scaled down in Austria, whilst maintaining that ‘strong trading’ across most of the group’s business operations meant that the firm will ‘remain optimistic’ about its Q4 prospects.

The CEO commented: “We have also continued our solid progress on our strategic objectives, including rapid expansion of our online business, digitalisation of physical retail, and submission of our proposal to operate the fourth UK National Lottery concession.”

Chvatal underlined that the group had embarked on critical end of year trading, in which the company has changed its business identity to Allwyn, to reflect the group’s ‘position as a global business’ and its transformation following significant M&As.

“After the end of the period, our parent company SAZKA Entertainment announced that it is rebranding as Allwyn, to create a unified and global brand that will support our continued international expansion,” he continued.

“Allwyn will retain the iconic local brands that are cherished by both its consumers and employees and have been a key factor driving the strong organic growth of the Company.

“Overall, I am very pleased with Allwyn’s continuing strong performance in Q3 2021 and I look forward with confidence and excitement to a great fourth quarter and 2022 as our strong trading momentum persists and we continue to make progress on our strategic objectives.”

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