Net Gaming has seen its share prices take a hit for the first quarter of the year, as the group aims to navigate a tumultuous European regulatory landscape.
The Stockholm-listed marketing operator reported a 6.2 per cent fall in revenues, down to €4.1m in the three months ended March 31. CEO Marcus Teilman attributed the drop to European uncertainty: “ongoing restructuring of the gaming market in Europe will continue to have an adverse effect on our revenue in the period ahead.”
Net Gaming confirmed that its EBITDA had fallen 16.1 per cent to €2.6m. Earnings would have been listed at €2.8m but for a one-time effect related to the divestment of the Battle of Malta poker brand.
Net Gaming attributed its losses to Europe-wide uncertainty over the future of gambling markets, with The Netherlands and Italy currently debating legislation – combined with the re-regulation of Net Gaming’s native Swedish market.
Teilman said: “The political regulatory effects in Europe and the transition to an increased revshare proportion are two main factors that explain why we have not shown better revenue growth during the first quarter.
“We face a period ahead in which these two factors will continue to have a negative impact on our revenue.
“Positive factors that stand out during the first quarter are revenue growth of 42% for North America and the continuation of re-regulation in the US.”
The marketing operator stated that it will shift its focus towards a merger and acquisition drive for the remainder of the year, as a bid to offset the impact of European regulations. The new focus will aim to deliver an increased geographical distribution of revenue.