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Svenska Spel revenue down 8% as wider market contracts in 2014

9th February 2015 9:30 am GMT

With the overall regulated gambling market in Sweden contracting during 2014, Swedish gambling monopoly operator Svenska Spel has reported an 8 per cent decline in net gaming revenue to SEK8.9bn for the full year.

The operator said that the decline was in line with expectations following the introduction of its responsible gambling controls, including mandatory player cards for all customers and the withdrawal of bonus promotions.

“I am proud that 2014 laid the foundation for enhanced gaming,” said Svenska Spel CEO Lennart Käll. “Our new responsible gaming program involves mainly mandatory registration and the abolition of bonuses and discounts.

“These measures have resulted in reduced revenues and are completely according to plan. From this base, we will continue to develop the gaming experience for our customers and strengthen our customer and partner relationships.”

Svenska Spel’s retail network remains its largest channel, representing 54 per cent of net gaming revenue (NGR) compared to 53 per cent the previous year, while its online and mobile channel grew year-on-year and now accounts for 17 per cent of total NGR, up from a 15 per cent share in 2013.

The restaurant and land-based casino businesses contributed a further 13 per cent of NGR respectively, while bingo halls and other businesses represented 2 per cent of the total each.

Numbers games (including Lotto, Keno and Joker among others) generated a third of NGR (33 per cent) during the year, followed by lottery games (Triss, Tia, and Penning) with 20 per cent.

Sports betting games including Oddset accounted for 18 per cent of the total, followed by VLT games with 15 per cent, down from 18 per cent the previous year. The remaining 14 per cent was generated by casino games (including poker) via Svenskaspel.se and Casino Cosmopol.

Svenska Spel recorded an operating profit of SEK4.7bn during the year, down 10 per cent compared to the previous year.

Looking forward to 2015, Käll said that the company will continue its focus on innovation in technology, product, and distribution, with its new digital platform enabling the operator to launch several new customer experiences including online casino games (pending approval from Swedish gaming regulator Lotteriinspektionen.

“An important part of our mission means that we will be able to offer games that are already on the market, where gambling can be moved to a safer and healthier environment,” he said. “We hope to get a license to provide online casino, which is a problematic form of gaming based on a game-dependence perspective.

“Our ambition is to offer a much safer and more responsible option, without sacrificing the experience. We will also be very careful with marketing, just as we are today with other risky products Vegas and Casino.”

According to Lotteriinspektionen, the overall regulated gambling market in Sweden fell by around 4 per cent to SEK44.9bn in 2014. Of this, the regulator estimated that SEK4.4bn was generated by illegal foreign gaming operators, an increase of 40 per cent versus the previous year.

Horse racing monopoly AB Trav och Galopp posted a marginal 1 per cent increase in turnover to SEK3.7bn following a 6 per cent improvement in online turnover, while the Swedish Postcode Lottery also recorded growth of 1 per cent to SEK2.1bn.

There were year-on-year declines however for IOGT-NTO (Miljonlotteriet), Synskadades RF och Sveriges Dövas RF (Månadslotten) and SAP/SSU (Kombilotteriet).

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