The Swedish horse racing organization, AB Trav och Galopp, experienced a surge in earnings during the initial six months of 2020. This uptick was attributed to the postponement of other sporting events due to the COVID-19 outbreak. With other sports on hold, patrons shifted their focus to wagering on horse racing, resulting in a 33.2% jump in revenue compared to the equivalent period in the previous year.
The company’s fundamental horse racing betting offerings witnessed a substantial increase in earnings, with a 19% rise in contributions from horse racing wagers. This growth was attributed to the continued operation of Swedish horse racing while other sports were suspended, leading to heightened interest both within the country and globally.
The Elitloppet, a prominent trotting competition held at Solvalla Racecourse, attracted a record number of businesses placing bets on the event. The V75 pool betting game also saw enhanced participation with seven additional jackpots.
In spite of the absence of athletic contests since the beginning of spring, ATG still managed to boost its sports wagering income, which climbed by 26.5% to SEK 148 million. This was in part due to the information from online gambling operator Ecosys, which was purchased in 2017 and consolidated until April 1, 2019.
Meanwhile, revenue from online casinos increased by 50.0% year-over-year to SEK 207 million.
The vast majority (SEK 1.91 billion, or 75.3%) of the first-half betting revenue came from the internet, while contributions from physical locations decreased by 3.1% to SEK 628 million. ATG received an additional SEK 158 million in revenue from its retail partners, while other revenue (including copyright fees for horse racing coverage) grew by 37.4% to SEK 364 million.
Turning to expenditures for the period, ATG saw betting taxes paid in the first half rise to SEK 505 million, while personnel expenses rose to SEK 220 million. Other revenue-related expenses remained the largest expense, although they fell year-over-year to SEK 1.22 billion.
After SEK 36 million in capitalized development costs and SEK 137 million in depreciation and amortization (stemming from work to redevelop and enhance its product range), the company’s operating profit jumped by 72.9% to SEK 1.02 billion.
After SEK 4 million in financial expenses and SEK 46 million in income tax, the operator’s net profit for the first half rose by 70.8% to SEK 970 million.
This follows a strong second quarter performance, with revenue for the three months ended June 30 rising by 33.2% to SEK 1.74 billion.
This included SEK 1.43 billion in net betting revenue, of which SEK 1.28 billion came from horse racing (up 34.2%); SEK 46 million came from sports betting (down 27%.
ATGs primary revenue stream is derived from lottery ticket sales, comprising 57.1% of their total earnings. Online gaming platforms contribute the remaining 42.9%. Sales representatives generated 85 million Swedish kronor, while other income sources amounted to 225 million Swedish kronor.
Following the deduction of gambling taxes and operational expenses, ATG’s quarterly operating profit more than doubled to 677 million Swedish kronor. After subtracting 6 million Swedish kronor in financial charges and 28 million Swedish kronor in income tax, the company’s net earnings reached 643 million Swedish kronor, representing a 121% surge from the prior year.
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