ZEAL Network generate €65m in nine-month revenues


ZEAL Network SE Germany’s leading online provider of lottery products, achieved further growth in the first nine months of 2021 thanks to the stability of the business model, with a much weaker jackpot development than in the same period last year.

In the first nine month of 2021, billings of the ZEAL Group rose by 5% to EUR 493 million of which the Germany segment accounted for almost the entire amount (2020: EUR 470.9 million).

Revenue increased by 1% to EUR 65.1 million of which EUR 61.5 million was attributable to the Germany segment At 12.2%, the gross margin in the Germany segment was thus stable compared to the prior-year figure.

The market environment for lotteries in Germany during the first nine months of 2021 was comparatively weak: the jackpot of the European lottery ‘Eurojackpot’ only reached the EUR 90 million mark three times (2020: six times), while the mandatory payout mark for the German lottery ‘LOTTO 6aus49’, set at EUR 45 million since 23 September 2020, was not reached at all (2020: three times). Low jackpots have a negative effect on Billings, gross margin and new customer acquisition.

Personnel expenses and other operating expenses of EUR 14.5 million and EUR 33.2 million, respectively, were also well below the corresponding prior-year figures (2020: EUR 16.6 million and EUR 43.0 million). As a result of adjusting marketing expenses to the jackpot environment, ZEAL significantly improved the profitability: for example, adjusted EBITDA for the first nine months of 2021 rose to EUR 17.6 million (2020: EUR 6.9 million) The Germany segment accounted for EUR 16.6 million of this amount (2020: EUR 5.2 million). EBIT and net profit of EUR 11.1 million and EUR 7.3 million, respectively, were also well above the prior-year figures (2020: EUR 2.9 million and EUR 6.6 million).

“The fact that we have managed to continue to grow with a significantly weaker jackpot development compared to the previous year at the same time significantly improve the profitability makes us proud. It furthermore demonstrates that we have taken the right measures by adjusting marketing investments and implementing strong cost discipline to match the market reality” says Jonas Mattsson, CFO of ZEAL Network SE. “The scalability of our business model will also help us in the future to take advantage of market opportunities, adapt to the dynamic environment and continuously optimise.”