kambi group plc
TRANSCRIPT
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KambiGroup plcQ2 2021 Report23 July 2021
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Agenda
1. Highlights
2. Financial highlights
3. Strategy update
4. Euro 2020
5. Canadian opportunity
6. Industry recognition
7. Summary
8. Q&A
Q2 Report – 23 July 2021CEO Kristian Nylén & CFO David Kenyon
Highlights
Q2 Report – 23 July 2021CEO Kristian Nylén & CFO David Kenyon3
€42.8mRevenue for the quarter
Strong quarter with revenue of €42.8m and net cash rising to €84.5m
Increased US reach with online launches across total of four states
Expanded presence in South America and launched with Belgian National Lottery
Performance boosted by Euro 2020 tournament delivering strong operator trading margin
€16.6mOperating profit
Q2 2021Operating loss
Q2 2020: -€3.4m
€42.8m 39%
Q2 financial highlights
Q2 Report – 23 July 2021CEO Kristian Nylén & CFO David Kenyon4
Revenue Q2 2021
Revenue Q2 2020: €14.8m
Operating margin Q2 2021
Operating margin Q2 2020: -23%
Operator trading analysis
Q2 Report – 23 July 2021CEO Kristian Nylén & CFO David Kenyon5
Kambi operators' turnover and trading margin
221 239219
242281 277
254 259 273307
334369
398 387412
560
505
259
669
989
1056
911
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
9.0%
10.0%
11.0%
12.0%
200
300
400
500
600
700
800
900
1000
1100
Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021
Turnover Index Margin%
Kambi revenue conversion
Q2 Report – 23 July 2021CEO Kristian Nylén & CFO David Kenyon6
Q2 2021 vs Q2 2020
0%
30%
60%
90%
120%
150%
180%
210%
240%
270%
300%
330%
Operator Turnover Growth * FX impact Operator margin impact Taxes/marketing deductibles impact Other ** Kambi Revenue Growth
* Operator turnover growth shown is based on Q2 2020 exchange rates ** Other includes the impact of volume-related commission tiers and fixed revenues-- Denotes components of NGR from which Kambi's revenue share is calculated
€92mCash
€14mCash inflow
Q2 2021
72%Equity/assets
ratio
Balance sheet
Q2 Report – 23 July 2021CEO Kristian Nylén & CFO David Kenyon7
Strong balance sheet, perfectly positioned to support both organic and acquisitive growth
Four key strategic pillars to drive success
Future platform to provide additional
scope for differentiation
2026 potential global TAM
of €44bn-€63bn
Capital Markets Day overview
Q2 Report – 23 July 2021CEO Kristian Nylén & CFO David Kenyon8
Available to watch at Kambi.com
Total Addressable Market
Q2 Report – 23 July 2021CEO Kristian Nylén & CFO David Kenyon9
Updates in key markets:
− New York
− Arizona
− Canada
− Peru
− Belgium
USA€15bn - €20bn
Rest of Americas€4bn - €7bn
Asia€7bn - €10bn
Europe€18bn - €26bn
Potential global TAM €44bn - €63bn
Strategy update
Q2 Report – 23 July 2021CEO Kristian Nylén & CFO David Kenyon10
Key pillars
Regulatory compliant core platform to enable
growthDelivering regulatory, financial
and technical security and stability
Sportsbook success and value creation
Development of American football product ahead of new
season
Differentiation and empowerment
Enabling partners to take control where it matters most and express their respective
brands
Automation of price differentiation capability to give partners more control
Power of the network
Leveraging unique global network data to
enhance product and service for all
Development of machine learning model to detect price
inefficiencies
Highly scalable business model
Signing and launching new partners in a uniquely cost-
efficient manner
Averaged more than a partner launch every week plus signing
of NG Gaming
Regulatory compliant core platform to enable growth
American football product development
Q2 Report – 23 July 2021CEO Kristian Nylén & CFO David Kenyon11
Introducing our expansion of same game combinations
− Players increasingly want to create their own bets through the combination of outcomes within the same game or across games
− Kambi has offered combinability across a range of sports and will expand it further within American football for this coming season
− It will enable end users to combine main and player prop bets in a single game, and combine those with bets in other games
− Combination bets are a key product feature in all markets. E.g., in New Jersey, c.50% of revenue is derived from 'parlay' betting
Q2 Report – 23 July 2021CEO Kristian Nylén & CFO David Kenyon12
Highly scalable business model
Signing of NG Gaming Expansion of South American network
− NG Gaming’s Olimpo.bet brand was launched in Peru ahead of the start of the Copa America
− Brand to be launched in other markets in the region over the course of the contract
− South America is a continent of real promise for Kambi, with Brazil expected to open next year
− Completed on average a launch per week in Q2, including online launch of Belgian National Lottery
Euro 2020
Q2 Report – 23 July 2021CEO Kristian Nylén & CFO David Kenyon13
Volumes grew as the tournament progressed
− Euro 2020 was a record summer soccer tournament for turnover, despite fewer games than 2018 World Cup
− After slow start, volumes picked up, e.g., Round of 16 games had more than twice the bets of Group Stage games
− Of games that went to extra time, approx. 40% of live bets were placed during this additional period
− Bet Builder drove more than 20% of all Euro 2020 operator gross gaming revenue
Canadian opportunity
Q2 Report – 23 July 2021CEO Kristian Nylén & CFO David Kenyon14
Ban on single wagering in country abolished
− Kambi estimates the regulated sports betting market could be worth €2.1bn in GGR by 2026
− There is no fixed timeline, but first regulated single bet could be struck ahead of NFL season
− Ontario could be set to become one of the largest online markets in North America
− Kambi’s US presence and heritage in popular Canadian sports, such as hockey, leaves it well placed to capitalise
Industry recognition
Q2 Report – 23 July 2021CEO Kristian Nylén & CFO David Kenyon15
Kambi named world’s leading sportsbook at industry awards
− Kambi won three awards at the prestigious EGR B2B Awards 2021, including the headline Sportsbook Platform Supplier category
− Kambi also won Online Sports Betting Supplier of the Year and Retail Supplier of the Year at the Global Gaming Awards 2021
− Both the EGR Awards and Global Gaming Awards are independently adjudicated and judged by experienced industry executives
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Summary
Q2 Report – 23 July 2021CEO Kristian Nylén & CFO David Kenyon
Strong financial performance
Progress continued across key strategic pillars
Regulating markets present more opportunities
Q&A
kambi.com17
Thank you
kambi.com18