Fdj United · EURONEXT:FDJU
Fdj United — Kindred Group — Q1 2022 Earnings Presentation
25 slides from Fdj United's earnings presentation, Apr 28, 2022
Slide 1: Q1 2022 | 28 April 2022
Q1 2022 | 28 April 2022
Slide 2: Q1 2022 highlights
Q1 2022 highlights Business overview – Q1 performance – Focus on locally regulated markets – Product segment update – Regional update – North America – Relax – Sustainability Summary
Slide 3: Decision to cease activity in the Netherlands led to a substantial topline decline
The decision to cease activity in the Netherlands and tough comparatives led to a substantial topline decline which has reduced our short-term profitability GBP 246.7m GBP 187.2m GBP 24.5m GBP -5.5m 1,377,317 GBP 66.8m (-30%) (77% of GWR) (-81.5m) (-95.6m) (-24%) GWR (B2C) reached GBP Short-term rev
Slide 4: Revenue (B2C & B2B)
Revenue (B2C & B2B) GBPm 1,259.6 1,130.2 244.9 907.6 912.8 364.7 298.4 751.4 250.1 236.2 544.1 238.0 280.7 230.7 226.0 363.7 Q4 152.8 354.1 193.6 Q3 226.2 235.1 111.4 142.3 219.0 86.1 166.6 Q2 126.6 352.6 80.5 207.8 224.4 249.7 246.7 122.4 153.2 Q1 76.1 2015 2016 2017 2018 2019 2020 2021 2022 * Year
Slide 5: Expenses as % of revenue
Expenses as % of revenue FY FY FY Q1 28.5% 27.6% 2019 2020 2021 2022 22.8% 22.8% 16.6% 16.0% 15.8% 16.3% 13.4% 10.5% 9.7% 9.3% 8.1% 7.7% 5.6% 5.5% 4.6% 4.6% 3.5% 2.3% Cost of Sales Cost of Sales (excl. Betting duties & Affiliates) Marketing costs Marketing costs Salaries Employee costs Other Opex Ot
Slide 6: Illustration of scalability with current cost base and ceased activity in the Netherlands
Illustration of scalability with current cost base and ceased activity in the Netherlands Underlying EBITDA margin 25% • Temporary top-line pressure reduces our profit margin in the short-term 20% • Costs for Netherlands currently Q1 2022 carried in the P&L without any Excl. US revenue contribution
Slide 7: Underlying EBITDA
Underlying EBITDA* (GBPm) 332.1 27.6 288.2 84.8 204.9 118.2 186.5 58.2 Q4 113.7 74.9 128.0 124.3 75.8 56.7 31.1 Q3 81.5 38.2 47.8 35.7 27.5 34.6 42.3 49.9 Q2 21.0 33.8 33.3 106.0 22.9 18.5 28.6 30.0 47.7 27.9 44.3 Q1 14.5 24.5 2015 2016 2017 2018 2019 2020 2021 2022 * From Q4 2021, the definition of
Slide 8: Currency impact (FX rates)
Avg rate Q1 2021 Q1 2022 Movement AUD 1.785 1.852 -3.8% DKK 8.509 8.896 -4.5% Weighted average impact of EUR 1.144 1.196 -4.5% 5.4 FX rates on GWR was a negative NOK 11.738 11.866 -1.1% impact of approx. 4% SEK 11.577 12.531 -8.2% USD 1.379 1.341 2.8% GBPm Revenue -9.4 Cost of sales / Opex 7.4 FX lo
Slide 9: Business overview
Slide 10: The daily average GWR during Q1 2022
The daily average GWR during Q1 2022 (GBPm) 92 37 53 90 # of days 2.9 • Solid start to Q1 up until 6 February 2.6 2.6 2.7 2022 with daily average GWR of around GBP 2.9m Sports • Stable casino performance throughout betting the quarter • Sports betting had a good start, supported by sports betting ma
Slide 11: Strong GWR growth in locally regulated markets
Strong GWR growth in locally Transition towards locally regulated markets continues - stable regulated markets (GBPm) Growth long-term profit margins despite short-term regulatory headwinds FY19-LTM 1,145.0 +25% GBPm 80% 300 912.8 70% 390 Other 250 markets +3% 60% % of locally regulated GWR 200 379
Slide 12: Active customers and ARPU
Active customers (‘000)/ • Number of active customers ARPU (GBP) amounted to approx. 1.38 million, 2,000 a 24% decrease compared to Q1 2021 1,800 1,600 • Expected decrease as a result of the closure of services to 1,400 Dutch residents 1,200 • The ARPU remained broadly in 1,000 line with Q4 2021 but
Slide 13: GWR by product segment Q1 2022
Q1 2022 GWR by product segment Q1 2022 Sports betting Poker, 3% Other, 2% • GWR 30% behind tough comparatives, adversely impacted by ceasing of Dutch activity, but a 10% increase sequentially Sports • Kindred’s proprietary racing product contributed 46% betting 9% to the total sports betting GWR 49%
Slide 14: Sports betting margin after free bets
• The sports betting margin for Q1 2022 was Sports betting margin after free bets 10.2% after free bets (vs. 9.4% in Q1 2021) driven by favorable market and product mix • The weighted long-term (since Q2 2019) 10.7% 10.7% average sports betting margin after free 10.2% 10.0% bets is 9.3% 9.4% 9.3% •
Slide 15: GWR by region Q1 2022
Q1 2022 GWR by region Q1 2022 Other Western Europe CES 6% • GWR decreased 47%, heavily impacted by ceasing of Dutch activity. 11% Nordics Excl. Netherlands, the GWR decreased by 14% 31% • In local currency, Belgium grew by 9% while the UK and France declined against the strong GWR posted in Q1 2021
Slide 16: US operations Q1 2022
US operations Q1 2022, GBPm GWR 5.6 • New depositing players up 16%, increasing activity levels within Kindred’s operational states CoS -6.2 Marketing -6.4 • GBP 5.6m in GWR Q1 22, approx. -26% y-o-y in local currency Admin expenses -2.1 • Product margins across both sports betting and casino were l
Slide 17: Launch in Ontario, Canada
• The first Canadian province to regulate both sports betting and casino • 7th largest economy in North America by GDP • The market estimated to reach CAD 4.4bn* at maturity • Kindred’s 7th regulated North American market (after the 6 US States) • Kindred launched with the Unibet brand on Day 1, Apr
Slide 18: Relax Gaming
Game launches during Q1 2022 • The Q1 B2B revenue from Relax amounted to GBP 4.3m • Relax total Q1 revenues amounted to GBP 6.0m out of which GBP 1.7m came from Kindred • During Q1 Relax signed 13 new operators and 6 new games were launched • Strong focus on continued growth with several new custome
Slide 19: Our journey towards zero
Our journey towards zero • The journey towards zero per cent of revenue from harmful gambling continues and it is key % of GWR Social Low Risk Medium Risk High Risk for sustainable growth 100% • Data from Q1 2022: 90% ‒ Share of GWR from high-risk players: 3.3% 80% ‒ Improvement effect after interve
Slide 20: Summary
Slide 21: The daily average GWR
The daily average GWR (GBPm) • Q2 2021 reported near all time high GWR and 92 90 26 # of days offers a very tough comparative for 2022 • The average daily GWR for the Group up 2.6 2.7 to and including 26 April 2022 was: 2.5 ‒ 37% (35% in constant currency) lower than for the full Q2 2021 Sports ‒ 15
Slide 22: Summary and long-term view
• While this temporary top-line pressure reduces our profitability in the short-term, we maintain a very positive long-term view • Our long-term strategic direction of increased product control and improved customer experience is well on track thanks to development of the Kindred Sportsbook Platform
Slide 23: _TUDL.)!UlLmL—l—‘(ai‘(Ca O”étsé‘(‘ i < <ati:il —i——_
© Kindred Group ple 2022 _TUDL.)!UlLmL—l—‘(ai‘(Ca O”étsé‘(‘ i < <ati:il —i——_
Slide 24: Investor relations contacts and upcoming reports
22 July 2022 Q2 2022 will be published at 7.30 CET Patrick Kortman +46 723 877 438 27 October 2022 ir@kindredgroup.com Q3 2022 will be published at 7.30 CET Linda Lyth +46 767 681 337 ir@kindredgroup.com
Slide 25: Kindred
>k kindred