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Kindred Group, a global online gambling operator with brands like Unibet, has released its first-quarter earnings report. In the fall, Kindred Group announced it would abandon the North American market, but its users can still pivot to one of our other best sports betting sites.

The results are mixed, with the company's relatively flat year-over-year revenue figures. Despite marginal increases in total revenues, gross winnings revenue, and gross profits, the figures released are seen to be mostly positive as the company's impending exit from the North American market looms.

According to Kindred CEO Nils Andén, “We have had a solid start to 2024 with the underlying business operations performing well and operational initiatives moving forward according to plan. The headcount reduction plans announced at the end of last year are progressing as intended and the North America exit is set to conclude towards the end of the second quarter this year. Our growth plan that we launched during the fourth quarter last year, focusing on Europe and Australia, continues at pace with dedicated strategic growth projects across locally regulated markets.”

Getting into the numbers

As mentioned, most of the figures released in the Kindred Group first quarter report were similar to Q1 of last year. Last year's figures are highlighted in brackets in the following breakdown of the revenue numbers.

  • Total revenue was GBP 307.7 (306.4) million, in line with the first quarter of 2023.
  • Gross winnings revenue (Business-2-Customer) was GBP 297.6 (297.3) million.
  • Underlying EBITDA increased by 20 per cent to GBP 59.3 (49.4) million.
  • Profit before tax was GBP 39.8 (30.4) million.
  • Profit after tax was GBP 31.4 (25.6) million.
  • Earnings per share were GBP 0.15 (0.12).
  • Free cash flow amounted to GBP 23.7 (29.0) million.
  • Number of active customers increased by 3 per cent to 1,667,564 (1,623,568)

EBITDA (earnings before interest, taxes, depreciation, and amortization) and adjusted EBITDA had respectable year-over-year gains for the company. Profits before and after tax showed the biggest gains, however. Profits before taxes came in 30.9% ahead of last year's pace. After taxes, profits were up 22.7%.

Locally regulated markets carry their weight

Kindred Group took advantage of strong growth, especially concerning gross winnings in locally regulated markets. Non-regulated markets were a drain on the company's bottom line.

According to Kindred Group CEO Nils Andén, “Share of gross winnings revenue from locally regulated markets at a new all-time high of 84%, indicating our continued focus to sustainable revenue and our commitment to a positive contribution to society.”

On the other hand, “weak performance in non-locally regulated markets, with gross winnings revenue declining by 16 percent,” was a drag on the company's overall Q1 performance.

Western Europe markets saw a 10% year-over-year increase, accounting for 64% of the company's gross revenues. The Dutch and UK markets were also strong, although France and Belgium, according to the Kindred report, were the company's weak spots in Europe.

Casinos perform well too

Kindred Group's casino and gaming markets performed relatively well in Q1. Casino accounted for 56% of gross winnings in Quarter 1, ahead of sports wagering, which made up 39% of gross profits over that time period. Poker made up just 3% of revenues for Kindred.

Gross winnings for the casino sector grew 3% year over year, while active users were 6% better than in Q1 of last year. Real money online casinos have shown growth in several jurisdictions.

Sports betting gross revenues actually fell 3% year-over-year in Q1, and poker revenues dropped 6% over that time.

Looking forward

Despite underwhelming, relatively stagnant Q1 earnings, there is optimism for Q2. As Nils Andén said, “Following a solid start to the year we now have our eyes firmly set on a much sought-after summer of sports with the UEFA Euros, the Copa America and the Paris Olympics.” 

Q2 has been relatively strong so far, with average daily gross winnings revenue up about 6% from last year. Sports betting revenue is up 11.3% year-over-year so far in Q2. The second quarter is expected to be better, despite Kindred's plans to exit the North American market altogether during the three-month period.