Kindred Group’s Q2 Report Shows Return to Growth in “Extraordinary Quarter”

Article ByDavid Weir

July 25, 2023

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Posted in: US Gambling News, US Sports Betting News

Kindred Group, the Swedish-based global gambling operator and owner of Unibet, recently published its Q2 report for 2023.

The report reveals a 29% annual increase in revenue, rising from £238.7 million ($306.28m) in Q2 2022 to £307.3 million ($394.6m) in Q2 2023. However, when the earnings from the Netherlands market are excluded, the company recorded a more modest 1% increase.

The news comes after a turbulent quarter (and indeed, the past few years) for Kindred. That included a dramatic May 2023 when four top executives resigned and an extraordinary general meeting was called. Previous long-term CEO Henrik Tjärnström departed, as well as the company CFO and its head of marketing.

However, new interim CEO Nils Andén remains upbeat with the publishing of the Q2 report.

“It has been an extraordinary quarter in many ways,” he said.

Despite all the challenges, he spoke positively about the company’s return to growth.

“The ability to maintain the positive business momentum in a time of change is a testament to the strong talent, leadership, and commitment across the organization, as well as the proven business model put in place over the years,” Andén said.

A Rollercoaster of Revenues

Over the past four years, Kindred’s Q2 revenues have seen some significant fluctuations.

In Q2 2020, the company reported £235.1 million ($301.41m) which surged up 55% to £363.7 million ($466.79m) in Q2 2021.

However, the following year saw a substantial drop of 38%, with revenues settling at £238.7 million ($306.28m) in Q2 last year. 2022 also saw its Unibet brand exit the Iowa sports betting market, finishing as the second least-popular operator in the state after a full year of operation.

This year, the company is returning to growth. It conducted a large and full-scale operational review after the change in management, which could be now coming into effect.

Profit and EBITDA Back to Growth

Kindred’s EBITDA has also seen a year-on-year increase, totalling £51.4 million ($65.9m) for Q2 2023, a significant rise from £21.6m ($27.69 million) in Q2 2022.

The company’s profit after tax for this quarter totalled £27.7m ($35.51 million), a considerable increase from £5.8m ($7.44 million) in Q2 2022.

The company’s shares have also seen topsy-turvy performance over the past six months, with prices fluctuating significantly.

This instability is largely because of the changes in management, the major internal review, and a decision to issue share buy backs. That last measure can indicate a potential sale, which the company confirmed at the time.

However, with revenues now growing again and the company looking more stable, any sale could be less likely to materialize.

Long Term Commitments

One number Kindred might not be so happy about (although it’s good that they publish it at all) is the company’s revenue from harmful gambling, which was reported as 3.1%.

That’s a figure that has remained relatively constant over the past few years. That’s despite Kindred’s public commitment to reducing this figure to 0% in the long term.

“Reducing harmful gambling is a long-term commitment for us,” Andén stated. “We’re continuously working on strategies and measures to achieve this goal.”

Kindred currently operates in four legal U.S. states under the Unibet brand. It celebrated this quarter’s rollout of its proprietary in-house technology for its New Jersey operation in the report.

“Kindred’s proprietary platform was successfully launched in New Jersey with initial positive results, in line with the ‘one platform’ strategy,” the report said.