Kindred Group, a frontrunner in the online gambling industry, has surpassed its annual targets, demonstrating robust financial results for Q4 2023. The company’s strategic initiatives and efforts to expand its market have fuelled revenue growth, even in the face of increased costs. The highlight of the year was a substantial 45 percent increase in underlying EBITDA.

Revenue and profitability boosted by robust Q4

For Q4 2023, Kindred Group posted a total revenue of $394.31 million (GBP 312.9 million), a 2 percent increase year-on-year. This growth was fuelled by the company’s strong performance in key markets such as the Netherlands, UK, and Romania, and the ongoing expansion of its B2B segment through Relax Gaming. The underlying EBITDA saw a significant surge of 45 percent, reaching $71.5 million (GBP 56.8 million).

CEO Nils Andén (in photo above), explained that the company’s capacity to achieve profitable growth within highly regulated markets. He noted that 82 percent of gross winnings revenue in 2023 came from locally regulated markets. Andén expressed satisfaction in exceeding the guided underlying EBITDA target of $252 million (GBP 200 million) for the year, a testament to Kindred’s operational efficiency and strategic acumen.

Future growth path and market expansion

In 2023, Kindred Group reported a total revenue of $1,525.46 million (GBP 1,210.5 million), a significant 13 percent increase from the previous year. The gross winnings revenue (B2C) saw a notable 12 percent rise to $1,476.82 million (GBP 1,171.9 million), while the underlying EBITDA soared by an impressive 58 percent to $257.71 million (GBP 204.5 million). These figures underscore the company’s consistent growth trajectory and operational strength. Andén attributed the strong performance to strategic initiatives, particularly in the casino and games segment, which accounted for 57 percent of gross winnings revenue during the quarter. The success of Relax Gaming further bolstered the company’s revenue, with a 33 percent increase in total revenue and a remarkable 72 percent rise in underlying EBITDA contribution. Despite a decrease in net profit due to increased costs, Kindred Group remains confident in its ability to deliver above-market growth in 2024. Andén reiterated the company’s focus on cost-saving measures and strategic resource allocation to drive profitability and enhance shareholder value. The trading update up to 4 February, 2024, revealed a slight decrease in average daily gross winnings revenue compared to the same period last year. However, Andén remains optimistic about Kindred’s future performance, citing robust performance in core markets and ongoing operational initiatives as key growth drivers. The confirmation of Nils Andén as permanent CEO further solidifies the company’s leadership stability and commitment to executing its strategic plan. With a clear focus on market expansion, product innovation, and operational efficiency, Kindred Group is poised for continued success in the dynamic online gambling industry.

Competitor comparison

Kindred Group has shown strong financial performance. In 2023, it reported a total revenue of $1,525.46 million (GBP 1,210.5 million), representing a significant 13 percent increase from the previous year. When compared to some of its key competitors, the revenues are interesting to see. For example to Flutter Entertainment plc, headquartered in Ireland, reported a revenue of $9.5 billion. Entain PLC, based in the United Kingdom, had a revenue of $5.3 billion. Precise revenue figures for other competitors like Neveo, Eldorado Casino, Hero Gaming, and Yggdrasil are not readily available.

In the context of the takeover, French group La Française des Jeux (FDJ) has launched a cash tender offer to acquire the entire share capital of Kindred. The offer price represents a premium of 24 percent over the closing price on 19 January 2024. This acquisition is expected to create a European gaming champion with an enhanced financial profile.

Going forward, the takeover by FDJ could potentially lead to a more diversified and balanced profile for Kindred, strengthening its strategic positioning in the gaming industry. However, the completion of the tender offer remains subject to regulatory authorisations.