Svenska Spel CEO eyes further growth as net profit rises in Q1
Svenska Spel’s CEO, Anna Johnson, recently highlighted promising investment opportunities across the organization following a remarkable 73.1% surge in net profit during the first quarter of the fiscal year. However, it’s worth noting that revenue faced a decline of 4.1%, primarily due to the closure of two Casino Cosmopol venues early last year.
Financial Overview
In Q1, net gaming revenue reached SEK 1.88 billion (£145 million / €170 million / $194 million). Although this figure represents a decrease from SEK 1.96 billion in Q1 of the previous year, Johnson remains optimistic about the company’s future trajectory.
The decline in revenue can be traced back to the closure of two brick-and-mortar casinos in January 2024, leaving only one operational location. In a significant legislative move, Sweden’s government recently voted to abolish land-based casinos, with the ban set to take effect on January 1, 2026. Svenska Spel has publicly supported this decision.
Strategic Focus Amid Challenges
Despite the impact of casino closures on overall performance, Johnson emphasized that this shift would enable Svenska Spel to concentrate on more lucrative areas of its business. “We have faced challenges in the Casino Cosmopol sector for quite some time. The closure of our last casino will conclude that segment of Svenska Spel’s social mission by 2026,” she remarked, reflecting on the journey and contributions of the casino staff.
While acknowledging the costs associated with closing the remaining location, Johnson is confident that the restructuring will pave the way for future growth in other sectors of the company.
Impact of Seasonal Variations on Lottery Revenue
Looking at segment performance, Svenska Spel’s Tur lottery remains a powerhouse but experienced a slight revenue decline of 1.1%, totaling SEK 1.22 billion. Johnson explained that the later timing of the Easter holiday this year contributed to this dip, as Easter typically serves as a peak period for lottery sales; last year’s holiday fell in late March, within Q1.
Conversely, revenue from the Sports & Casino segment saw a modest increase of 0.4%, reaching SEK 551 million, aided by strong sales of the Oddset product.
Digital Transition: A Mixed Bag
The results within the Vegas gaming machine segment were less favorable, with revenue plummeting 25.7% to SEK 75 million. This decline has been linked to responsible gambling initiatives that have encouraged reduced player spending. The soon-to-be-closed Casino Cosmopol location in Stockholm generated SEK 26 million, a stark 61.8% drop compared to Q1 last year when two other venues were still operational.
On a more positive note, online gaming revenue surged to SEK 1.18 billion, reflecting a 6.9% increase, with mobile gambling accounting for 53% of this income. However, agent revenue fell 11.6% to SEK 602 million, alongside significant decreases in revenue generated from restaurants and bingo halls.
Robust Net Profit Amid Restructuring
Despite overall revenue challenges, Svenska Spel’s operating profit nearly doubled to SEK 609 million, attributed in part to personnel savings following the closures. The company experienced higher costs in Q1 of the previous year due to the fallout from the dual casino closures.
Pre-tax profit reached SEK 641 million, marking a 72.8% increase. After a tax deduction of SEK 132 million, the net profit amounted to SEK 509 million, reflecting a substantial 73.1% increase over the previous year.
“Through significant changes last year, including reorganization, we have created room for investments in our key focus areas: growth, sustainable gaming, and transformation,” Johnson concluded. “This capacity for investment not only underscores our strategic direction but also positions us to create long-term, sustainable value in the gambling landscape.”
By staying ahead of industry trends and prioritizing innovative solutions, Svenska Spel is poised to navigate the evolving dynamics of the gambling sector successfully.
