SGHC - Earnings call 4 2023 | Super Group (SGHC) Limited

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Operator

Good morning, everyone and thank you for joining us today to discuss Super Group's results for the fourth quarter and full year 2023.

During this call, Super Group may make comments of a forward-looking nature that are subject to risks, uncertainties and other factors discussed further in its SEC filings that could cause its actual results to differ materially from historical results, or from the company's forecast. Super Group assumes no responsibility, to update forward-looking statements other than as required by law.On today's call, Super Group may refer to certain no-GAAP financial measures. These non-GAAP financial measures are in addition to, and not a substitute for, measures of financial performance prepared in accordance with GAAP. Super Group has provided a reconciliation of the non-GAAP financial measures to the most comparable GAAP measures -- figures in the press release issued earlier today, and available on the Investor Relations page of Super Group's website.In addition, Super Group will speak to its financial results, and metrics in two parts highlighting Super Group's profitable, and cash generative global business, separately from its investment into the U.S. business annual and Super with forward. XXXX, Super views the for has both with Super Group XXXX how both and its aligns guidance report Group that provided how Group This will and going internally, is consistent Group Chief to supplementary Executive Financial Alinda Wyk, to investors Officer presentation am joined Officer. refer call, Chief website.On and this I that by recommends posted Super its the Neal Menashe, Van

President be During being Operating and the like Hasson, session, call by question-and-answer note recorded.And is to the over would Chief also [Operator event joined Please will I Instructions] to Officer. turn Neal. Richard we this now,

Neal Menashe

morning, X and Earnings XXXX you. to Super everyone, and Good Year-End Group's Quarter Call. Thank welcome

have We strides tremendous made in XXXX.

I'm profitable and path sports diverse XXXX. a We I'm as and we about last business. long-term the excited geographically the iGaming really in we have into head we sustainable just and for are proud outlook a are third-year betting our year, cementing New achieved as to clear future so York-listed a growth. online like position feel what operator.We getting and our of We as started

to shareholder a look the returns.Let's our meaningful are quick excluding deliver U.S. XXXX take numbers, We at determined long-term

Indian the by QX, XXX challenges, and quarter had unprecedented million, its to margin, a low results closure fronts.Moving that For for both October's of of EUR total XXX X.XXX for we total with fourth soccer revenue operational a The on new the billion. in easily guidance million. on EBITDA, we EUR came at meaning EUR full total year, set driven EUR XX of And record surpassed EBITDA annual million, market. revenue of we achieved with the operational sports

ability highest and our a strong month.The base. fourth for loyal a our navigate the the road testament and ever recovery, new to these diverse However, a was is best-ever in we December and EBITDA was to bumps Total quarter, some revenue records. set made customer

are deliver strong, the customers numbers and go same million active quarter.Our than we the million customer betting is to across XXX,XXX have and the proving and to XX our customers without this, revenue consistently set investment XX% full records daily monthly customer million. against for year Even sports surpassed quarter to quarter Worldwide, remains taking for X.X in casino. daily U.S., acquisitions, the on to unique customers highs, those record-breaking grew from our fourth and when customers. ability both customer along casino, results.In Over customers fronts, growth EUR new point net X.X results is more last quarter this than net million, EUR more the still even loss Our of came year, at new Each sports them. us, had us of an year of our That deposits. was India, and that we drove each retention EBITDA XX the last our average active our we customer with impressive.

was African key strong engagement, to even we at metrics see the of us quarter behind with an provide we though with of been business had top-line achieve on Starting new being the driver, sports in growth growth. We key universe. over of the that with to that center XXXX.Now market jurisdictions. our update, the for Africa, are October. the some accomplished double-digit projecting negative And years. for a are a for We revenue this, customers another margin These XX it's have will us playing from customers, technology-driven existing great continuous which of business, strong we confident our some and both make

new both explore we to products new continue and the and into of brands, forward, existing introduction Moving markets.

In Jackpot regions the significantly our grew rolled the similar [ Both City UK, quarter Europe, and us launched are across growth. month, Africa, established. African last typically Betway ] brand. define Italy for casino we're markets, prospects super Asena City Spain And most offering its were the the our particular, brand that presents And successfully by out first localized standout and year-on-year, more delivered continent.In content.In delivered growth Jackpot mature as Jumpman excited performers. brand segments ever. into gaming we would to Just we encouraged about strong market. new their we we see profitable which in to

slot per well handle cap later are positioned Gambling for this to online games year. UK We spin to introduce a the plan Commission's

nature to casino revenue, the Canada, grew customer strong impact have expect and well, a business, UK this remains a of on our prompted the But attention limited industry this is for overall customer us. and an regulation Ontario, base.In the We now our were. of not And because initial In exceeding, technology, of good effect. great.In market while we dip. initially now the plan, the with with previously are what it our pleased was they are as ever before which quo. communicated revenues, and marketing are rules continue we the Customer status as new stabilized, took migration U.S., composition values,

the moving BXC global great finalizing announced close allow Once structure, iGaming, and the you Global. will Games all pleased size business, BXB of to completed, the our the our includes division we control assume favorable U.S. to wish a Apricot upfront a sportsbook very parties, our Global this and be DGC of February in will with and we to the I'm hands, software the The and required, we on an luck the full consideration, hand a to small of state-by-state and will earn-out. are the provide M&A. make the for competitive to the forward will will relatively of an investment Betway sale that transaction before built discuss of which technology. completed detail. to and know landscape, we milestone greater the an whether financials required.We in call let which number assets states as that, new aligns that the are of currently update in The organically, business.Finally, BXB of regulated up, existing through markets, or strategy completion our best Alinda worldwide to wrapped month.I risk-sharing the rollout this to actively is our forward. changes the Alinda? now are with the terms Given of of agreements and is and growth basis for evaluating end DGC's We look commercial of This deal comprises over monumental goals, getting

Alinda Van Wyk

on the challenges, various how strong to top line. teams have both XXXX, and the Thank bottom growth you, pleased with Neal. navigated deliver Reflecting across I'm the

numbers. Our remains growth.Let's business and get into straight future for resilient adaptable, the model primed

a comfortably revenue record revenue, at EUR came billion. beating we EUR new total which XXXX, constant in X.XX for currency. X.XXX billion, our up in And For total XX% ex-U.S. guidance X% therefore, and set year-on-year of

performance December, quarter XX% growth the the XX% impacted, November, This course in in results in in quarter.Moving currency. revenue XX% of but in rebounded strong We total of optimizing casino, decline in impacted due have XXX closure and also Despite revenue for million, constant touched quarter, increase strong year-on-year was EUR million, This decrease right and with currency.As on comparative costs Africa, quarter million, or was to in at in X% and the XX soccer. which this XX% on in of the growth by year-on-year market, Indian in revenue some the delivered am we the to net progress performed Canada currency. customer-friendly constant closure XXX constant the sportsbook the of European by highest-ever areas. the in performance we sportsbook by declined of fourth in the included last I in very year-on-year up for and better XX% an revenue pleased was came to even EUR our was is still of offset the India. a fourth We October's call, of EUR made segment, markets. driven the earnings further

continuously We understand our the about efficiently. operate Instead, are the cutting for can where and costs, areas we analyze more improved sake we of costs not margins.

We innovation. to are and technology, drive long-term investing processes AI enhanced in efficiencies and

year allowed costs revenue. revenue in has in as compared led our year. to huge the operating our the quarter net of to of us a quarter is net of fourth XX% than percentage the of last total more a XX%.This of saving to to reduce focus All headcount XX% X% over this same by falling This

for ex-U.S. spent return optimal least on targets, on We EUR XXX Another delivery being the will and sacrifice investment We our scrutinized to continue growth, to net revenue the want channel in of never per fourth the comfortably of per marketing We is improvements.Operational to came growth. XX% marketing. guidance market to invest long-term year-on-year EUR where full and of top-line short-term ensure XXX sake margin revenue area EBITDA quarter. our at our we for of growth XXXX at year million, XX% beating million. deliver the during

resulting the grew results, EBITDA XX% The was actually EBITDA points EBITDA the target margins year XXXX. This long-term in resulted in of month. XXX in margin EBITDA quarter year-on-year which XX%.For direction a compared above Our for the the XX%, of negative basis positive improvement our as the an by a EUR XX to operational of margins the step to sports for million, margin quarter, robust impacted XX%. for of is was of maintaining

and negative The EUR continue our the However, being EBITDA EUR of and year million, to in our to our will XX EBITDA EUR loss and ex-U.S. strong over XX we XX% EUR to line resulting respectively, was year XX%, spend to EUR operational leverage top to November, for guidance, that achieved grow kicking growth than XX% X.XX just U.S. of operating estimate in EBITDA XX December XXXX we strongly million.Moving XXXX, million the around of of slightly year-on-year billion. the forecasted for margins million, end XX demonstrating in. with less

EBITDA. practice, between Going two forward, adjusted we immaterial. operational best are in now EBITDA that on difference to aligned with metrics instead of XXXX we ensure was and will these The report

EUR for spending In guidance at a the the similar a XXXX started year's we minimum EBITDA last U.S., is Our year. ex-U.S. of rate million. adjusted have to XXX

the XXXX we likely that being options are evaluating exceed constantly for our last U.S. spend process adjusted I in of we not do expected, are assessing year. various will loss, the As that think still the returns while is it EBITDA what generated.And and market, spent the we

which cash of Lastly, back Thank and no call a you. strong ended unrestricted with now to the turn the will an million debt.I XXX balance we year sheet, EUR include Neal.

Neal Menashe

extremely Thanks, Alinda. year. for team, Group to their year. in the a Despite ever we I this past total a October, for and entire fourth quarter, dedication revenue set Super results for full well and recovered our customer-friendly highest thank commitment

sports in When segment.Casino adversity. Our results us, be with business overcome on Over betting model from puts position in a our a good in rely proves revenue the casino XXXX, came our the can go ratio XX% us of quarter to casino to fourth growing XX%. anchor. against to we net great

XXXX era Group. Super are for year We this business, that to of will was confident a fantastic continue trend our upwards.

business are encouraging is base and continues clear We clear, break a future for have very a customer-centric our for This to game very plan growth.We records. customer XXXX.

areas, yield of of a the marketing technology, the in the We of product our objectives realization and footprint, which will City into highest these and our our channels, further flow. and rollout the growth including the delivery cash our on top continued of global our the on EBITDA, help areas, are return projections Ongoing number in on investment, U.S. fine-tuning new efficiencies optimization focused The line, investment brand, casino meaningful free increase across continued right cost existing of achieve of Jackpot us including markets. double-digit

and expectations the questions. success.I'll forward XXXX, for Operator? high operator the turn to to up look over to have call We open for now call the continued

Operator

[Operator from with question comes Graham Instructions] Michael The Canaccord. first

Michael Graham

depth ask for more to your business on, plans for I U.S. the just in wanted a XXXX. little

say maybe What you're with You you you about a state-by-state range state? of comment And you competitive happy some of two, the assessing position? one, states these sort timing your can are I can just Could any each in mentioned options what on number options range on, basis. about a of the decisions? of there just number of guess, say

Richard Hasson

Michael, Richard here.

that of number them soon are point, a alongside details relooking geographic and all much So, at M&A. obviously also casino just with footprint as going as can. through at front very course, states at assessing from, of our looking At mind more of extensive and But detail. is as them options, Neal we course, possibility focus getting of we'll of looking and a any this and, and you to, pointed out, we they all, potentially we are range current in update this lot of

Michael Graham

one quick just Okay. maybe And then on Brazil. a

Just can your give in thinking updates Brazil and your us strategy any wondering, you're on about how thinking there? you

Neal Menashe

other currently. This there is we all operate countries, Neal Brazil, here. like

So, with we product, cetera. means are -- waiting for for the the our for taxes, it regulated what et regime

the it's of So, an for course, to final market important there. waiting regs we come are out and

Operator

comes question from Oppenheimer. Kelly next The with Jed

Jed Kelly

Just [indiscernible] you're then maybe outlook, talk owned? the can your you your given is just how And about, like you technology your regions, can from? baking vertically is upside probably in, percentage talk coming and what what integrated and of most tech migration about

Alinda Van Wyk

again? want Jed, I Apricot will the mean, update acquisition You Can get to just you'll the Richard know question just tech of software. migration, think in your USA. on I -- the referring to tech you --you're first an repeat on migration

Jed Kelly

like where outlook, us best the can tell growth? seeing your on you're just you're you what -- regions, Yes,

Alinda Van Wyk

Neal this is saw a our of It's Italy of doing called head few countries, to always is also its also that before. that is out a the then growth we lifted And Canada countries into Central rest on list. say that, of very of some went European. detail year. was and Spain we Neal as doing we overview Jed, good really, really well as well. but quite of and back really on we African pulled has there well with the And out getting the standards listed Ontario out, in very strong couple Africa really also top

Richard Hasson

at. is on as seven of we're part in we're the the migration, with two the currently live last nine U.S., that the so. technology that within But, of of states the Jed, migration migrated, the wider looking expected our being that various or options touching states on month have currently considered assessment next course, of

Operator

with & The next Company. question McTernan comes Bernie Needham from

Bernard McTernan

there state-by-state the Maybe iGaming U.S., or iGaming changed, a M&A. Has there? slower your expected? a outlook just mentioned but has And on has has legislation, basis, on just You just of kind you your in it as assuming interest than thoughts with assets do that M&A? to then start been be legislation follow-up in to could stay What interesting mentioned it, to well.

Richard Hasson

right. All

I they're the on business, amount number Neal industry the obviously think been of currently expected. iGaming out think, pace as mentioned, has of regulation this small So, a has the yes, a from gaming.So course, slower point, regulated. are large states there's than, that of that comes relatively And our large number, running I global important Within revenue a our of that's for us. yes,

at that U.S. of In overall assess terms the the at at state both sense be and our numerous for any sure make And of range we done, the for a we're it's again, one of as M&A, for the obvious, options looking price And M&A to strategy shareholders. it risk we look makes has options. right and parties of at

Bernard McTernan

Slide on in casino, XX% performance currency just growth 'XX, appreciate 'XX, each and at middle expect I them look difference sense. betting revenue But between like just in to growth the to kind XX the about happened Makes providing that you or the meet guys and how we should are the that if it. in in we then should to be get it. thinking product? Got sports about And constant versus of

Neal Menashe

here, got great. sports Neal we is a December it to just November, it's in from obviously Yes, be as listen, over but bit obviously I October, can time, betting then volatile, you've mean, but side was saw margin, my set

on. I would So where would say XX%, I XX% your on yes, still based targets that, probably set casinos,

Operator

And from The question Hickey have Company. Benchmark from Mike Instructions] a [Operator we

Michael Hickey

guys, like obviously the Latin on looks got call it's America here. some curious. late, getting Sorry but heat just I

here, Just of market like it's would. there? to lot curious challenging thanks, that's curious, But you in U.S. capital you spread, the the it the share a and see a The environment, any but the the opportunity to anymore? color just into energy terms for motivation then a just seems, together. right in alone maybe, longer-term U.S., trying market, not puzzle the know thought business, it on drive of there obviously we because your and case hasn't growth. value, the put pieces I be but seems maybe And the optionality But your as of of put guys, you

Neal Menashe

Neal here. obviously Because regulate. Listen, it's all we about starting LatAm. LatAm to is

a So from see We've been to our there of the long point it view, we continent. very African similar time.

in see the it's regs waiting the countries, cetera. if each what mean Chile, of Peru, to Brazil, are et We

the to cetera, an similar us, for very important Africa. course use, et we software of market.And -- is So it's

to for point the U.S. And well And then that's journey. And So our bodes it your all got address fall. that. part how regs will of just we've see now. Richard

Richard Hasson

And we internally. these detail. have can getting the Yes, to Mike. is work you options the and to that have on that. It's as market, so world, assessing and to proving lot get a we very and as tough. profitable, market, the all other the top now we a it's soon of clear, attention what in the doing point we're in yes And to the important we in us are That's invested much going in response and it, time we markets how that's out we're it's becoming U.S. as around of while U.S. we've sustainable through similar evaluating ultimately will what business.And currently We're to investment a and of constantly update very spent what put re-evaluating, actively. as

Neal Menashe

update. just And I to wanted then

One tech, of new on stack. on our was tech the our asked questions

simple. to that across Africa. is Jumpman then And means then own Africa, our that that will et Global. got sportsbook beginning end.And It cetera, across globe. almost the We've own its deliver is sportsbook this products, So tech our has can from the use X the including stack, and proprietary we obviously all it we all Apricot with globe, there. means we our can pricing, Betway

excited there So, that. It about we're almost has we're taken now. super but long,

Michael Hickey

profitable does make in some you gentlemen. of And operators at quick kind offer sense, states narrow One U.S. think betting. sports business. mean, of have the it that Yes. of they from the sort of smaller a sort more to share I have look that that also on follow-up, suffered both and be iGaming approach market, I focus? terms found When to of think your focused I near-term

you operators. are respected obviously so, guys And

just brand, off the I do they We But are narrow does just your have something of there? a of And combined build terms be, it kind mean, can their sort something and to of TBD, You LTV? at tech. obviously to wanted transformative, your the to innovate feel it the have sort in you but mark on do how matter transformative Does that the or of with to states from mind, needless maybe far the Richard, gate. is get not saw focus deal Penn out of, say, Neal this something business? it have you be point? or the result in then ESPN, you

Richard Hasson

Mike, a spectrum. option across we're of very broad options so assessing, to there, are much that And in type type progress. you're those exactly a of speaking the it's the work that

is at called and looking of sports One footprint gaming. inclusive geographic of the those that's betting

earlier, the always I of the just those iGaming said Another as states. at there's one And possibility potentially of also looking is M&A.

options the to going range really work what the for is of business are through and out the full going and best shareholder. we for So,

Operator

and presentation. XXXX This Group's for the attending results our Super for today's you year conference question-and-answer Thank session fourth call. and quarter full concludes

You may disconnect. now

Super Group (SGHC) 6 Mar 242023 Q4 Earnings call transcript