Intralot delivers stable 2020 earnings despite system shocks

Athens-listed Intralot SA has published its financial results for the 2020 fiscal year, prepared in accordance with IFRS, noting an almost 17% decline in revenue after its lottery and sports betting industries were significantly impacted by the COVID-19 pandemic.

For the 12 month period which ended on December 31, 2020, Intralot declared a group revenue of €364.8m, a 16.6% decrease on FY19’s €437.3m. 

Lottery Games was the largest contributor, comprising 60.6% of its total revenue, followed by Technology Contracts, contributing 16.3%. Sports Betting accounted for 14.8%, VLTs represented 7.6%, while Racing constituted 0.7% of total revenue.

The group reported a gross gaming revenue (GGR) from continuing operations for FY20 of €292.9m, a reduction of 14% compared to FY19’s €340.5m.

Intralot maintained its EBITDA in FY20, however, recording €66.2m, a 2.5% increase on the previous year’s €64.6m, while adjusted EBITDA came in at €55.8m, a 5.9% improvement on 2019’s €52.7m. Its pandemic impact estimation for 2020 is in the vicinity of €25m of its EBITDA level.

Chairman and CEO Sokratis P Kokkalis commented: “During the financial year 2020, we faced the adverse effects and disruptions of the COVID-19 pandemic, which had a significant impact on the lottery and sports betting industries. This impact was only partially offset by mitigation measures, operational improvements, and cost-containment efforts.

“We remained focused on developed markets seeing significant growth in the US in the Lottery operations and we launched two new Sports Betting operations in Montana and Washington DC, while we renewed significant contracts in Georgia, US as well as New Zealand, Australia and The Netherlands. 

“The company management also dedicated significant effort in negotiations with the bondholders to optimize the capital structure through a transaction that is expected to be completed during the first half of 2021.”

Intralot reported a net income after tax and minority interest (NIATMI) from continuing operations of €-104.1m, up 1.2% on FY19’s €-105.4m.

The group’s North America operations, under Intralot Inc, accomplished notable year-on-year growth, with revenue up by 22.3%, while EBITDA increased by 62.1%.

Intralot’s Group OPEX in FY20 fared better by 21.5% year-on-year, with Greek entities OPEX lower by 7% year-on-year, without taking into consideration the capital structure optimisation expenses. Group net CAPEX came in at €36m, lower by 34.5% compared to a year ago, while group cash came in at €100m and net debt at €651.1m.

Notably, in early 2021, Intralot completed the sale of its entire stake of 20% in Intralot de Peru SA, with the net cash consideration, after taxes and transaction expenses, amounting to $16.2m. It also signed a three-year extension of its current contract with Intralot de Peru SA through 2024, to continue to provide its gaming technology and support services.

In Q4 of 2020, Intralot recorded total revenue of €107.4m, a 3.8% increase when compared to the same period the previous year (2019: €103.5m), a GGR of €86m, up 11.5% (2019: €77.1m), an EBITDA of €20.7m (2019: €4.7m) and a NIATMI of €-42.9m (2019: €-53.1m).

The group noted that increased revenue for the quarter was primarily the result of the better US lottery performance, coupled with the slow pickup of its new US sports betting contracts, equipment sales in BCLC/Canada, Illinois and Netherlands, as well as the improved performance of Bilyoner, favoured by the strong growth of the online market. 

However, this improvement was in part offset by the continuous COVID-19 impact in most of its key regions and revised commercial terms in Morocco and the Netherlands.

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