Super Group blames macroeconomic headwinds for 14% decline in Q2 online casino revenue

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Super Group has reported a 10% year-on-year decline in net gaming revenue to €320.8m for Q2 2022.

The decrease was driven by a 13.6% downturn in online casino NGR to €204.3m for the reporting period, down from €232.1m in the same period of last year. This impact was felt most in Canada, which is the firm’s largest operating market.

The NYSE-listed operator pointed to the unstable macroeconomic environment and “the impact of inflationary factors on disposable income” as a major reason for the decline, as well as tough comparatives due to the Covid-19 gains experienced during 2021.

Super Group CEO Neal Menashe said: “The current macro environment may provide near term headwinds, but Super Group’s balance sheet remains strong and our business remains fundamentally sound.

“By investing in our global business, we continue to focus on organic and strategic growth opportunities in pursuit of long-term sustainable profits,” he added, suggesting macroeconomic impacts would continue to be felt for the remainder of the year.

The dip in casino was partially offset by an increase in sports betting NGR, which rose by 5.2% to €110.7m thanks to growth in Africa and the Asia-Pacific regions.

Indeed, Asia-Pacific is now the operator’s second largest operating market behind North America. Revenue from the territory climbed by 24% in Q2 to €77.4m.

The biggest gains in Q2 came courtesy of Super Group’s core market of North America, which includes the US and Canada.

NGR from this region climbed by 44% to €142.1m, representing 44.3% of total.

Adjusted EBITDA at Super Group fell by 30% annually to €63.6m in Q2, down from €90.8m in the prior corresponding period.

Unlike many of its competitors, particularly in the US, marketing expenses actually declined year-on-year by 3.4% to €225.7m as the operator continues to focus on sports sponsorship and digital marketing over costly above-the-line activations and acquisition offers.

Profit after tax rocketed by 367.3% to €298.6m however, after benefitting from non-cash adjustments related to the business combination with SPAC Sports Entertainment Acquisition Corp and subsequent public listing on 27 January.

Finally, monthly average customers increased by 3% in Q2 to 2.7 million.

The Betway brand remains the biggest contributor of group revenue at 55%, compared to its Spin online casino brand at 45%.

Super Group CFO Alinda van Wyk: “With changes in consumer behaviour driven by economic uncertainty, revenue growth has slowed down in the second quarter.”

Alinda van Wyk, CFO of Super Group, said: “As you are well aware, 2022 has been a difficult year for many industries, including the global digital gaming industry.

“With changes in consumer behaviour driven by economic uncertainty, revenue growth has slowed down in the second quarter.

“Super Group is a profitable and debt free company with a continuing track record of consistent cash generation.

“Despite some current challenges, we have increased monthly active users, while focusing on financial discipline to maintain profitability and we continue to invest in the future growth of Super Group.”

Super Group has reduced full-year 2022 NGR guidance as a result of economic and regulatory headwinds to between €1.15bn and €1.28bn, as well as adjusted EBITDA of between €200m and €215m.

About the author

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Jake Evans

Jake Evans is an NCTJ-accredited journalist and editor who has covered the online gaming and sports betting industry since 2017. He is the managing editor of iGaming NEXT and has previously worked in both content and data for EGR, Stats Perform and Football Radar.

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