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NetEnt Expected Better Results in Q2
- July 19, 2018 By Riley Wilson -
NetEnt, the renowned online software developer, has revealed the financial report for the second quarter of this year.
The released numbers show the company’s total revenue for this period has increased by 5.9%.
NetEnt managed to generate $49 million in revenue during Q2 2018, which is 5.83% more than during the corresponding period of 2017.
Growth Rate a Bit Slower
The operating profit from April to June 2018 reached $16.7 million, which represents a margin of 35.6%, while game transactions also grew 7% to $10.8 billion on an annual basis.
It is obvious the NetEnt’s revenue growth rate was slower in the Q2 when compared to the first quarter of the year. NetEnt stated this was the case due to the development of the Swedish krona in relation to other currencies, especially to euro and British pound.
The company further stated that depreciation and amortization were also affected by the development of SEK versus EUR as they were booked in EUR and then translated to SEK for the group’s financial reporting.
According to NetEnt, the revenue growth was also negatively influenced by the slower business performance in the Nordic countries and the United Kingdom.
On the other hand, the NetEnt’s revenue continued to grow steadily when it comes to locally regulated markets in Southern and Eastern Europe.
The Next Quarter Needs to Be Stronger
If we talk about the total revenue in the first half of 2018, it recorded a rise of 7.6% to $97.2 million. The operating profit reached $31.7 million, which is 1$ million more than in the same period of 2017.
During the same period, NetEnt managed to sign 14 new license agreements and to launch casinos for 15 new customers.
The company’s total cash flow during the first six months of 2018 is $48.32 million, while the acquisitions of the intangible assets reached $8.4 million.
Therese Hillman, NetEnt’s Chief Executive Officer, said everyone was focused on the company’s turnaround in the third quarter, despite the expected seasonal effects that lead to lower increases in both revenues and personnel costs.
Hillman noted NetEnt had good chances to continue its growth in the United States since the Supreme Court has lifted the ban on sports betting.
She has also revealed the plans to create a broader selection of games when the new licensing in Sweden starts in 2019.