Allwyn has experienced remarkable growth, with its Q3 revenue nearly doubling year-on-year to €368.4 million.
Earnings also saw an increase during this period, and adjusted free cash flow reached €336.6 million, reflecting a 10% rise.
The group’s significant acquisition of Camelot UK, the current operator of the UK’s National Lottery, in February played a pivotal role in this success.
Allwyn is set to take control of the lottery in February next year under the fourth National Lottery license.
Additionally, Allwyn acquired Camelot Lottery Solutions (now rebranded as Allwyn North America) earlier in 2023, bolstering its presence in the US market.
Allwyn’s CEO, Robert Chvatal, expressed satisfaction with the Q3 progress, asserting that it positions the company for further growth in Q4 and beyond.
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Chvatal acknowledged some challenges, such as customer-friendly sports results impacting the sports betting sector and less favorable jackpot cycles.
In terms of financial performance, Q3 saw a 98% increase in consolidated gross gaming revenue, reaching €1.92 billion.
Net revenue, which accounts for gaming taxes and good causes contributions, also rose by 38% to €883.3 million.
Excluding the Camelot acquisitions, Allwyn’s total revenue showed a 1% decrease at €1.01 billion for the quarter.
Gross gaming revenue remained steady at €965.2 million, with net revenue decreasing by 1% to €636.1 million.
Challenges like customer-friendly sports results and jackpot cycles affected growth, with a notable example being the record-high EuroMillions jackpot in Q3 of 2022.
Geographically, the UK emerged as Allwyn’s core market in Q3, contributing €956.5 million in total revenue, although this marked a 12% decline from the previous year due to weaker numerical lotteries and shorter EuroMillions jackpot cycles.
The UK National Lottery’s transition from Camelot UK to Allwyn UK on February 1, 2024, comes with certain preparation-related costs.
In Greece and Cyprus, total revenue slipped 4% to €503.4 million due to unfavorable jackpot rollovers, customer-friendly sports results, and natural events like wildfires affecting point-of-sale availability. However, Allwyn reported growth in its online channel within the region.
Italy, on the other hand, experienced an 8% year-on-year increase in total revenue, reaching €554.0 million.
Austria reported a 2% growth in total revenue at €379.9 million, driven by instant lotteries, igaming, video lottery terminals, and casinos.
However, numerical lotteries were somewhat weaker due to shorter jackpot cycles in EuroMillions.
In the Czech Republic, Allwyn achieved a 6% increase in total revenue, reaching €123.1 million, driven by organic growth across all major products, particularly instant lotteries and igaming.
The US-facing Allwyn LS Group reported total revenue of €46.5 million in Q3, up 12%, mainly attributed to the strong performance of the Illinois Lottery.
For the year-to-date, Allwyn reported consolidated revenue of €5.70 billion, a 98% increase from the previous year.
Gross gaming revenue reached €5.47 billion, and net revenue was €2.60 billion, representing a 43% increase.
Adjusted EBITDA increased by 26% to €1.10 billion, while adjusted free cash flow reached €1.02 billion, up 23%.
Excluding the Camelot acquisitions, total revenue still grew by 7% to €3.09 billion, with gross gaming revenue at €2.97 billion, net revenue at €1.97 billion, adjusted EBITDA at €968.5 million, and adjusted free cash flow at €901.2 million.
Chvatal expressed confidence in Allwyn’s progress, despite sector challenges, and looks forward to a successful 2023 and continued growth in the future.