In the closing quarter of 2023, Evolution, a leading B2B Online Casino solutions provider, reported impressive financial gains, solidifying its position as a key player in the industry. Operating revenues surged by a notable 16.6 percent, reaching EUR 475.3 million from the previous quarter’s EUR 407.5 million. Simultaneously, the EBITDA experienced a robust growth of 20.5 percent, totalling EUR 337.0 million compared to the previous quarter’s EUR 279.5 million. The corresponding margin demonstrated a commendable increase, reaching 70.9 percent from the previous quarter’s 68.6 percent. The profit for the period amounted to EUR 282.9 million, contributing to an earnings per share of EUR 1.32.
Zooming out to the full-year performance in 2023, Evolution showcased an exceptional growth trajectory. Operating revenues soared by an impressive 23.5 percent, culminating in EUR 1,798.6 million compared to the preceding year’s EUR 1,456.7 million. This upward trajectory extended to EBITDA, which increased by 25.7 percent to EUR 1,267.4 million, translating to a margin of 70.5 percent a notable rise from the previous year’s 69.2 percent. The year-end profit amounted to an impressive EUR 1,070.9 million, with earnings per share reaching EUR 5.01. Additionally, the Board proposed a dividend of EUR 2.65 per share, reflecting a strategic move to distribute 50 percent of the net profit annually.
Although live casino giant reported strong revenue growth in 2023, its RNG segment lagged behind, with only 2.6 percent year-on-year increase.?
Analysts believe that Evolution’s acquisition of NetEnt was not a right fit highlighting that the RNG division was not adding value to the group or the sector.
Evolution’s failure to deliver RNG growth may hurt the industry in the long term.
CEO Martin Carlesund, (pictured above), in his insightful commentary, shared the company’s achievements and strategic vision. The fourth quarter of 2023 not only marked substantial financial growth but also operational excellence. Evolution surpassed its goal by adding 110 new games to the portfolio, exceeding the initial target of 100 set at the beginning of the year. Operational efficiency was evident in achieving a better balance between supply and demand for tables, coupled with accelerated expansion during the quarter. Despite facing currency headwinds, the company estimated a 25 percent growth in revenue at constant currency in the fourth quarter.
Carlesund highlighted the EBITDA margin for the full year, concluding at 70.5 percent, comfortably within the upper range of the communicated guidance of 68-71 percent. Looking ahead to 2024, the guided range is adjusted to 69-71 percent, emphasizing Evolution’s unwavering focus on expansion. The company plans to increase the pace of investment for future growth during 2024, with a strong commitment to sustained expansion.
Regionally, Evolution witnessed encouraging developments, with North America exhibiting strong momentum, Europe sustaining positive growth, and Asia and LatAm emerging as the fastest-growing regions. The announcement of Brazil’s regulation of online casinos at the end of the period signalled the rapid market development in this region, prompting Evolution to commit to continued investments in LatAm.
The CEO outlined the company’s efforts to accelerate studio expansions in the fourth quarter and into 2024, with the launch of a new studio in Bulgaria and the initiation of a second studio project in Colombia. Despite falling short of the initial capex guidance in 2023, the company plans to repeat the EUR 120 million capex guidance for 2024, reflecting strong demand and the commitment to enhancing the Live Casino product globally.
Evolution’s commitment to innovation is evident in its accelerated pace of game releases, surpassing the target with 110 new games across both RNG and Live Casino during 2023. As the company closed 2023, CEO Martin Carlesund expressed pride in the successful product roadmap and the dedicated team at Evolution. Looking ahead to 2024-2025, he outlined higher ambitions, with plans to create more exciting games, explore new game types, and invest in unique games for specific markets, aiming to further widen the gap with the competition.
While the presentation for investors, analysts, and the media has already taken place, Evolution remains steadfast in its commitment to sustained profitability, strength, and all-equity financing. The company looks to the future with excitement, hunger, and ambition, continuing to invest, recruit, and expand operations globally, striving to make Evolution a better entity each day.
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