Higher costs push net profit down at Danske Spil in Q1

| By Robert Fletcher
Danish lottery and gaming operator Danske Spil reported a year-on-year decline in net profit for the first quarter of its 2022 financial year due to higher taxes and increase dealer commission fees.

Gross gaming revenue (GGR) for the three months to 31 March 2022 reached DKK1.123bn (£129.2m/€151.0m/$158.2m), up marginally from DKK1.122bn in the corresponding period last year.

This small increase, Danske Spil said, was mainly due to the return of its Elite Gaming halls, which were closed for the entirety of Q1 2021 due to novel coronavirus (Covid-19) restrictions in Denmark. Elite Gaming revenue amounted to DKK61.0m for the quarter.

However, lottery revenue from the Danske Lotteri Spil lottery business was down by 3.0% to DKK637.0m and revenue from Danske Licens Spil, which offers licensed products such as sports betting and gaming, fell 8.4% to DKK423.0m. 

The other DKK2.0m in revenue came from the Swush fantasy sports platform.

Turning to costs, state taxes were 12.0% higher at DKK149.0m and dealer commission also edged up to DKK105.0m, though other game-related costs in Q1 were marginally lower at DKK65.0m.

Other external costs increased 2.1% to DKK148.0m and personnel expenses were 2.5% up to DKK81.0m. Though depreciation and write-ups spend was 25.6% lower at DKK58.0m, financial costs jumped 188.9% to DKK26.0m.

This left a pre-tax profit of DKK502.0m, which was 2.5% lower than in 2022. After including the DKK110.0m paid in tax, this left a net profit of DKK392.0m, down from DKK402.0m last year.

Danske Spil added it remains on track to achieve its full-year revenue guidance of between DKK4.8bn and DKK5.0bn, as well as net profit in a range of DKK1.6bn to DKK1.7bn.

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