NetEnt Interim Report Jan-June 2014

NetEnt Interm Report January - June 2014
This post is for the readers who are investing in NetEnt. It seems that NetEnt has some phenomenal news in terms of the financial reports of Net Entertainment NE AB.

The first thing we will let you know is the fact that NetEnt has increased its revenue by 38% since last year. The second quarter’s improvement is due to an increased development from the customer’s side as well as “more setup fees,” as stated by Per Eriksson, the CEO of NetEnt.

As for the number breakdown during the second quarter 2014:

  • Revenues for the second quarter of the fiscal calendar increased by 37.8% from 148.7M SEK to 205M SEK.
  • Operating profit increased by 46.6% from 38.7M SEK to 56.7M SEK.
  • Operating margin increased by 1.7% from 26% to 27.7%
  • Profit increased from 39.6M SEK to 52.5M SEK
  • Earnings per share increased by .33 from 1.00 to 1.33 SEK.
  • 10 license agreements with new customers as well as 13 new casinos launched with the NetEnt engine.

    • The first half of 2014:

  • Revenues for the second quarter of the fiscal calendar increased by 32.2% from 297.5M SEK to 393.4M SEK.
  • Operating profit increased by 35.5% from 79.7M SEK to 107.9M SEK.
  • Operating margin increased by .6% from 26.8% to 27.4%
  • Profit increased from 73.4M SEK to 98.6M SEK
  • Earnings per share increased by .63 from 1.86 to 2.49 SEK.
  • 14 license agreements with new customers as well as 15 new casinos launched with the NetEnt engine.

    • During the second quarter, some key events had occurred:

  • Agreement signed Full Tilt Poker.
  • Agreement signed with William Hill for a B&M machine.
  • Bet365 and, Sky Betting and Gaming launched.

    • The President and CEO of NetEnt, Per Eriksson also mentioned that the World Cup 2014 did not affect revenues in a negative manner although it is likely that such a large sport event can take attention away from casinos. He also mentioned:

    22 agreements were signed in total during the quarter, 10 were new customer agreements, five were for Live Casino, six for mobile games and one agreement, the first of its kind, was signed with William Hill for land based gaming machines (retail) where some of NetEnt’s games will soon be available in William Hill’s 2300 betting offices across the UK. According to the market research company H2 Gambling Capital the retail market is nine times larger than the online casino market in Europe, a market where NetEnt has not had any presence in the past. The launch of William Hill Retail will initially include a limited amount of games. The royalty level is lower compared to online games but long term, the retail segment will contribute positively to the growth.

    NetEnt also has plans on expanding to the U.S. market – New Jersey specifically, as they are working out a license as we speak. They also have plans on expanding in other regions such as Spain and Asia.

    For the full investor report, visit NetEnt’s website.