Kambi released on Wednesday its financial report for Q3, which showed revenue amounted to €41.6 million ($48.5M) for the third quarter of 2021 and €127.5 million for the period January to September, an increase of 48% and 80% respectively, in a year-over-year comparison.
As for the operating profit (EBIT) for Q3 2021, it was €14.7 million (versus 6.5 million in 2020), at a margin of 35.4% (23.3%), and €50.0 million (10.0 million), at a margin of 39.2% (14.2%) for the period January to September.
Profit after tax was of €11.9 million (5.1 million in 2020) for Q3 while the January-September period saw €40.3 million (6.8M last year). Earnings per share for Q3 were €0.384 (0.164 in 2020), and €1.302 (0.220) for the period of January to September.
Cash flow from operating and investing activities (excluding working capital movements and acquisitions) amounted to €11.9 (6.9) million for the third quarter of 2021 and €39.9 (8.2) million for the period January to September.
In an official press release, Kambi’s CEO Kristian Nylén spoke about Q3’s financial report and reflected: “Kambi Q3 revenue was up 48% year-on-year, operating margin was once again strong at 35% and we continue to be highly cash generative. Excluding DraftKings, operator turnover was up 10% year-on-year, highlighting the underlying growth in the business”.
“We had a strong start to the new NFL season, which kicked off on 9 September, with our platform outperforming the competition and our market-leading Bet Builder product engaging a large number of bettors and returning higher average operator trading margin. Furthermore, revenue in Q3 was boosted by our continued US expansion, including day one launches in Arizona, the 15th state in which Kambi has launched. In total, Kambi completed approximately one launch per week on average throughout the quarter”, he continued.
This past quarter, Kambi also acquired esports data and odds provider, Abios. “We believe Abios is a great fit for Kambi, and its technology and expertise will enable us to create a first-class esports product that will diversify our revenue streams by capitalising on the opportunities presented by this fast-growing vertical. The acquisition is also in line with our longer-term strategy to further modularise our platform and, with a strong balance sheet, we remain in a good position to explore additional acquisition opportunities in the future.”
“Of course, during the quarter we learned of Penn National Gaming’s decision to acquire theScore, a Canadian sports media company which owns a player account management system and plans to develop its own sportsbook. It’s incredibly difficult, as well as costly, to build, maintain, and continue to develop a first-class sportsbook, as we’ve seen with unsuccessful efforts of others in the past. In the meantime, we’ll continue to support their growth with our fantastic platform and service we have built over many years, which remains very much of interest to our growing list of prospective partners”, Nylén reflected.
To conclude, the company’s CEO balanced out the company’s quarter by saying: “In summary, we’ve performed well, and the future looks bright. We currently have a sales pipeline as strong and varied as I’ve known it. As the global trend of regulation continues, we are in a great position to capitalise on future opportunities as and when they arise, and we have announced the implementation of a share buyback scheme”.
The buyback mandate, which was received at the Extraordinary General Meeting on June 23, 2021, will run between October 27 and November 10, up to a total of €12 million.
The objective of this program, impulsed by the Board of Directors of Kambi, is to achieve added value for Kambi’s shareholders and to give the Board increased flexibility with Kambi’s capital structure.
To this end, Kambi has entered into an agreement with Carnegie Investment Bank AB to conduct the share repurchases on its behalf. The acquisition of shares shall take place on one or several occasions on Nasdaq First North Growth market in Stockholm and Carnegie will trade them independently of Kambi.