OPAP exceeds expectations with Q1 profit hike

Greek monopoly OPAP put a poor 2013 behind it in Q1 2014 as sports betting growth saw net profit jump by more than a quarter year-on-year ahead of the imminent launch of its new sports betting product.

The operator saw profits tumble by more 72% in 2013 following Greece’s new taxation measures, however the group’s performance in the three months ended 31 March 2014 saw a return to growth with GGR up 6% to €320.1m.

Net profit stood at €49.7m for the quarter, up 27% year-on-year, driven largely by a 27.8% increase in sports betting ahead of the upcoming launch of a new online sports betting product, powered by GTECH.

While OPAP did not break down its results by channel, equities firm Eurobank estimates that the monopoly’s online division will produce revenue of around €75m for this year, soaring to €487m in 2015 as more products are released on the platform.

CEO Kamil Ziegler said the sportsbook’s launch was one of several new products that OPAP hoped to launch this year, adding the group was “confident that 2014 will prove to be overall a rewarding year for all of our stakeholders”.

The operator also made note of an “ongoing reduction in operating expenses” with the group slashing its sponsorship and advertising costs over the course of the past year.

Stamatios Draziotis, research analyst at Eurobank, said that while the group had made a good start to the year there were no significant changes to 2014 consensus and that 2015 looked likely to be “more attractive” for investors.

OPAP’s results came a day after the Greek Gambling Commission published the Game of Conduct for OPAP’s online sportsbook in the government State Gazette, paving the way for it to be launched prior to next month’s football World Cup.

Competitors are said to be considering a legal challenge to the launch, claiming the lack of a three-month standstill period following the distribution of regulations violated European Union directives.