SAZKA Group wants to exploit the benefits of its expanded business entity, as the Czech gambling conglomerate returns to operating all business units having navigated 2020 Covid headwinds.
Publishing its Q3 trading update (period ending 30 September), the firm told investors that an easing of Covid restrictions across European markets had seen it return to ‘normalised trading in markets and business channels’.
As a result of Casinos Austria being incorporated as a new trading unit, SAZKA saw its consolidated gross gaming revenues (GGR) increase by 66% to €769 million. Excluding Casino Austria contribution, SAZKA noted that GGR performance would have been sustained at +1% growth €465 million (Q3 2019: €463 million).
The company also reported a solid sales recovery as H1 Covid restrictions were lifted across Greece and Italy, supporting its land-based Czech and Austrian gaming units which were materially impacted by restrictions during H1 trading.
Moreover, the firm’s improved land-based channels were supported by the continued growth of its digital inventory across all markets.
SAZKA reported a strong underlining group performance as consolidated operating EBITDA increased by 37% year-on-year to €197 million. The company also cited increased contributions from its Greek OPAP Stoiximan subsidiary.
Less welcome for the firm was a fall in Q3 consolidated profits of 33% year-on-year to €48 million – as it reported significant period costs related to its enlargement, absorbing a €22 million acquisition costs of property and equipment combined with a further €54 million ‘restructuring provision’ attached to its Casinos Austria investment.
Excluding Casinos Austria, SAZKA reports that Q3 profits after tax would have increased by 3% year-on-year to €56.5 million
Moving forward, SAZKA has begun to ‘future proof’ its Casinos Austria investment, for which the company targets delivering €45 million of annual cost savings.
Meanwhile, in November SAZKA secured a major strategic objective when US private equity group Apollo Global invested €500 million in the group to help drive its Czech M&A ambitions.
Robert Chvatal, SAZKA Group CEO, commented: “All of our businesses traded well in Q3 as lockdown measures were eased and online sales remained high. The swift return to normalised trading in the markets and channels that were more affected by restrictions in H1 demonstrates the resilient underlying demand for our products as well as the agility of our teams across the regions.
“In recent weeks, some COVID related restrictions have been reintroduced across our geographies, having some impact on our business. With our resilient business and strong management team having coped well with the situation earlier in the year, we are well placed to manage the business through the current restrictions.
“Overall, I’m very pleased with Sazka Group’s strong performance in Q3 and so far in Q4 and the strategic progress made so far this year. I am confident in our ability to manage any further challenges and emerge with an even more resilient business that is well-positioned for growth.”