2011 WAS A YEAR OF NEW INITIATIVES FOR CONTINUED SUSTAINABLE GROWTH
FOURTH QUARTER 2011
– Revenues for the fourth quarter increased by 21.6 % to SEK 121.1 (99.6)
– Operating profit amounted to SEK 42.2 (33.8) million
– Operating margin was 34.9 (33.9) %
– Profit after tax amounted to SEK 36.6 (29.0) million
– Earnings per share amounted to SEK 0.93 (0.73) before and after dilution
– Two new license agreements were signed, and two new customers’ casinos were
FULL YEAR 2011
– Revenues for the full year increased by 16.1 % to SEK 427.6 (368.3) million
– Operating profit amounted to SEK 129.7 (136.4) million
– Operating margin was 30.3 (37.0) %, 31.9 % excluding costs amounting to SEK
6.7 million related to former senior executives
– Profit after tax amounted to SEK 115.6 (120.5) million
– Earnings per share amounted to SEK 2.92 (3.05) before and after dilution
– Seven new license agreements were signed, including G.Matica and Sky Betting
& Gaming. Eleven new customers’ casinos were launched
– Proposed transfer to shareholders is SEK 2.00 (2.00) per share
IMPORTANT EVENTS IN THE FOURTH QUARTER
Revenue growth for the fourth quarter was 21.6 percent compared to the fourth
quarter 2010. The strengthened Swedish currency has held back revenue growth in
SEK. In local currency, revenues increased by 23.1 compared to the fourth
The number of game transactions amounted to 2.6 billion in the fourth quarter,
an increase of 19.6 percent compared to the previous quarter and 48.9 percent
compared to the same period in 2010.
During the fourth quarter agreements were signed for delivery of the casino
portfolio to several large operators on the newly regulated online market in
Denmark. On January 1 2012 Denmark opened up as a regulated market. Operators
signed include Betsson, Unibet, Bet24, Sportingbet (including Scandicbookmaker
and Danbook). Companies who intend to operate on the local market must fulfill
the gaming authority’s compliance requirements during the fourth quarter 2012.
During 2011, Net Entertainment has adjusted and developed the Company’s system
and games to be compliant with mobile units. In December the first mobile games
were launched on the market. The initial launch includes mobile games
supporting IOS terminals, i.e. Iphone, Ipad and Ipod, with three of the
Company’s most successful casino games, Gonzo’s Quest, Jack Hammer and
Blackjack. Net Entertainment’s mobile offering will be launched under the name
NetEnt Touch™ and will include some of the best games from both the existing
portfolio and new game releases. The launch of new mobile games will follow a
phased roll-out approach to several partners during 2012.
Net Entertainments strategy is to be the leader within online casino. It is a
continuous process to improve and expand the product portfolio and the Company
constantly analyzes new opportunities. As a result from this, the Company has
decided to launch its own Live Casino product with a planned release to the
market around year-end 2012. This product segment is a complement to the
Company’s existing games portfolio and is estimated to contribute positively to
the Company’s growth in the future.
During the fourth quarter Per Eriksson was appointed CEO of Net Entertainment
with a start date on March 1, 2012. Per is presently serving as CEO and
President of Dustin Group AB. Prior to that, Per has had a long career within
Dell, where he left as Head of Dell EMC (Europe, Middle East and Africa).
Intralot Interactive was launched in Italy where Net Entertainment is now live
with five out of eight operators.
COMMENTS FROM BJÖRN KRANTZ, ACTING PRESIDENT AND CEO
Year 2011 was a year of new markets and product initiatives to secure continued
solid growth for Net Entertainment moving forward. Revenues increased by 21.6
percent during the fourth quarter which is a result of organic growth. Net
Entertainment has been successful in strengthening the position as a leading
supplier of games and systems within online casino and our focus on customer
closeness and product and technology leadership will continue to differentiate
us. During 2011 our market share in Europe increased to 22.4 percent compared
to 19.3 percent in year 2010 1.
Net Entertainment has a clear focus on online casino and to complement the
existing product portfolio and strengthen the Company’s offering it was decided
during the fourth quarter to launch our own Live Casino product with a planned
release around year-end 2012. Live Casino is a relatively new form of gaming
which has proven to be successful and is also expected to show good growth in
the coming years.
We are committed to and take part in the ongoing regulation of our industry in
Europe. Whether Net Entertainment enters a regulated market or not, is
evaluated from case to case with regards to the financial, organizational and
the strategic impact on the Company as a whole. Net Entertainment was among the
first to enter Italy which regulated the market in July 2011 and Denmark which
was regulated in January 2012.
We have now commercially launched five out of eight operators in Italy. The
roll-out of remaining customers will take place as soon as practically
possible. In addition, it is our ambition to launch slots as soon as the
Italian authority allows it.
As a response to the growing mobile market the first mobile games were
completed and launch took place according to plan during December 2011. Ongoing
launches of new mobile games will take place during 2012 and we will monitor
the development closely. The launch of new customers will take place
continuously during 2012.
Several successful games have been lunched during 2011. Frankenstein was
developed as part of our collaboration with Universal Studios and during the
fourth quarter the development of Scarface was initiated which is one of the
most well known brands ever in the movie industry. Two new platinum games were
launched during the year, Robin Hood and Jack and the Beanstalk with graphics
and a gaming experience which truly proves why Net Entertainment is the leading
premium supplier of online games on the market today.
We will continue to invest in our business and organization to secure the
opportunities identified by the Company, and to ensure short and long term
competitiveness. We are taking another step towards becoming a full scale
provider within online casino and it is very exciting to be able to offer our
partners a broader product portfolio which strengthens both business and
customer value in our strategic delivery responsibility as a supplier. I am
convinced that Net Entertainment is well positioned for 2012 and I look forward
to another exciting year.
(1), The market share is based on the gross gaming yield with Net
Entertainment’s customers in relation to the European online casino market,
estimated by H2 Gaming Capital in December 2011.
For additional information please contact;
Björn Krantz, Acting CEO Net Entertainment; Phone +35679884734
About Net Entertainment
Net Entertainment is a premium supplier of digitally distributed gaming systems
used by some of the world’s most successful online gaming operators. The Net
Entertainment casino is a complete gaming solution comprising both a complete
management platform and a full suite of high quality games. Operators are
provided a customized casino that is easily integrated ensuring short time to
market and a cost efficient operation. Net Entertainment is listed on Nasdaq
OMX Stockholm (NET-B). More information about Net Entertainment is available at