Lotto24 posts stronger third quarter earnings
Lotto24 AG, the leading German provider of state lotteries on the Internet, continued to benefit in the third quarter from the strong development of the European lottery EuroJackpot in 2018 as a whole: Transaction volume increased by + 44.3% compared to the same period last year at EUR 74.7 million (previous year: EUR 51.8 million), sales at EUR 8.7 million even exceeded the comparable figure by 49.6% (previous year: EUR 5.8 million).
The gross margin increased to 11.6% (previous year: 11.2%), partly due to the positive development of the syndicates. At the same time, the company gained 90 thousand new customers (previous year: 55 thousand) in marketing costs per registered new customer (CPL) of 25.78 euros (previous year: 30.97 euros).
In the first nine months of 2018, Lotto24 thus achieved a total transaction volume of € 235.9 million (previous year: € 164.6 million, + 43.3%), sales of € 28.1 million (previous year: € 18.1 million). EUR 8 million, +49.8%) and a gross margin of 11.9% (previous year: 11.4%).
With 468 thousand new customers (previous year: 216 thousand), the number of all Lotto24 registered customers rose by 36.3% to 2,041 thousand (previous year: 1,497 thousand). Due to the jackpot-related expansion of our marketing activities and the series of comparatively cost-intensive TV commercials conducted in the first half of 2018, marketing costs rose to EUR 12.0 million in the first nine months of 2018 (previous year: EUR 5.8 million).
At € 25.58, however, the CPL remained below the previous year’s level (previous year: € 26.63). Thanks to the strong sales performance, EBIT improved to € 2.2 million. Euro (previous year: 0.5 million Euro); the result for the period was EUR 7.8 million (previous year: EUR 1.3 million), mainly due to a positive technical effect in connection with the formation of deferred taxes of EUR 5.8 million.
The company now expects transaction volumes to increase by 38% to 43% for the full year 2018, while the number of new customers and the CPL will continue to grow at the previous year’s level. In addition, Lotto24 AG is planning a slightly improved gross margin compared to the previous year. Depending on the further framework conditions – in particular the jackpot development – and the marketing investments for new customer acquisition, both EBIT and profit for the period will be well above the breakeven point.