LOTTO24 AG / Key word(s): Change in Forecast
Lotto24 raises guidance after strong first half of 2020
(Hamburg, 20 July 2020) According to preliminary calculations, Lotto24 AG (Lotto24.de, Tipp24.com), Germany's leading online provider of state-licensed lotteries, has not only significantly increased billings but also exceeded its annual target for new registered customers in the Germany segment already in the first half of 2020 supported by a strong EuroJackpot development with correspondingly high marketing investments and consequently raised its guidance for 2020.
Including the Tipp24 business as of 15 October 2019 following ZEAL's business model change and based on preliminary calculations the Company doubled billings to EUR 313.8 million in the first half of 2020 (2019: EUR 157.1 million). At a provisional EUR 41.9 million, revenue was even up around 133% on the prior-year figure (2019: EUR 18.0 million). Supported by the market launch of the social lottery freiheit+ in March 2020 and the positive development of lottery clubs the gross margin of an anticipated 12.4% was correspondingly higher than in the previous year (2019: 11.5%). With increased marketing investments of EUR 17.9 million (2019: EUR 5.4 million) to take advantage of the good jackpot environment, Lotto24 acquired a total of 593 thousand new registered customers (2019: 190 thousand) - including Tipp24's new customers since 15 October 2019 - at preliminary acquisition costs per new registered customer (cost per lead, CPL) of EUR 27.13 (2019: EUR 28.66).
The main reason for this better than expected development was the strong EuroJackpot in the first half of 2020 with an average jackpot amount of EUR 51.2 million (2019: EUR 35.3 million) and six draws in the amount of the EUR 90 million mark (2019: one), of which five were made in the second quarter of 2020 alone (2019: one). Despite the increased marketing activities aimed at this and the EUR 12.5 million higher marketing costs, adjusted EBITDA of EUR 0.4 million was only EUR 2.4 million lower than in the previous year (2019: EUR 2.8 million).
In fiscal year 2020, Lotto24 plans to continue expanding its market leadership as an online provider of state lottery products with the Lotto24 and Tipp24 brands. Due to the strong half-year figures, the Company now expects billings of between EUR 590 million and EUR 610 million (previously: between EUR 550 million and EUR 570 million), revenue of between EUR 72 million and EUR 74 million (previously: between EUR 66 million and EUR 68 million) and a gross margin of slightly above 12% (previously: slightly above the prior year of 11.6%) in fiscal year 2020. Depending on the general conditions, in particular the jackpot development, the continuation of the high marketing investments for the acquisition of new customers and the implementation of the planned synergy effects the Company continues to expect that adjusted EBITDA will remain well above the break-even point. With a lower CPL than in the previous year, Lotto24 is now anticipating the number of new registered customers to be around 800 thousand (previously: a significantly increasing number of new registered customers compared to the previous year with 397 thousand).
The half-yearly financial report as of 30 June 2020 will be published on 13 August 2020.
Explanations of the key financial figures used can be found in the Annual Report 2019 on the Company's website (available at Lotto24-ag.de, there under Investor Relations/Publications).
20-Jul-2020 CET/CEST The DGAP Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases.
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