ZEAL Network SE: New countries, products and customers: a bright future for ZEAL as Q3 results match guidance

Nov 10, 2017 7:30 AM

DGAP-News: ZEAL Network SE / Key word(s): 9-month figures

10.11.2017 / 07:30
The issuer is solely responsible for the content of this announcement.

New countries, products and customers: a bright future for ZEAL as Q3 results match guidance

London, 10 November 2017

ZEAL Group, the world's leading lottery innovator, today announced Earnings Before Interest and Tax (EBIT) of EUR12.5million for the first nine months of the year (2016: EUR23.3million) as it continued to invest in international expansion, product diversification and new customer acquisition.

The results, in line with guidance, are published on the same day as the Group launches Norway's first online charity lottery in partnership with UNICEF Norway. The UNICEF-lotteriet will help raise vital additional funds for the global charity to help support its work around the world. Tickets go on sale at 18.00 (GMT) and the first draw will take place on Friday 17th November through Facebook Live.

In October, the Group's continued focus on product diversification saw it deliver its most successful new product launch to date as it introduced world record-breaking US lottery, Powerball, to its portfolio. Additionally, the results of the Group's sustained focus on new customer acquisition were demonstrated by a nearly 80% uplift during the period compared to 2016.

Billings for the first nine months of the year were stable at EUR201.7million (2016: EUR204.1 million), while Total Operating Performance (TOP) showed a slight decrease of 3.6% to EUR97.6million (2016: EUR101.2million). This was driven by an exceptionally weak jackpot environment in the third quarter of 2017, increased hedging costs due to rule changes in the EuroMillions lottery, and cumulative prize payouts in the quarter of EUR3.7million above the statistical average.

Despite this challenging environment, ZEAL's diversified product and marketing approach enabled the company to outperform the market in terms of billings, by nearly 4 percentage points in the third quarter of 2017.

Dr. Helmut Becker, Chief Executive, ZEAL Group said: "The future is bright for ZEAL. We have brought a very significant number of new customers on board, have had our most successful ever new product launch with Powerball, and will tonight launch Norway's first online charity lottery in partnership with UNICEF Norway. Despite the unfavourable jackpot environment and higher than average prize payouts, our financial performance in the third quarter was solid."

Key Highlights for 9 months to 30 September 2017:

  2017 2016
Statutory EBIT EUR12.5 million EUR23.3 million
Billings EUR201.7 million EUR204.1 million
TOP EUR97.6 million EUR101.2 million
Average Monthly Active Users 372k 366k
Average Billings Per User EUR57 EUR58

Strategic outlook unchanged

The strategic outlook for ZEAL remains unchanged, with continuing attractive product and market growth opportunities for the Group. TOP is expected to range from EUR130 million to EUR140 million. The expected range for consolidated EBIT remains at EUR15 million to EUR25 million. ZEAL confirms its intention to pay a total dividend of at least EUR1.00 per share. This position is subject to review and may be amended depending on the Group's future earnings and financial position.

- ENDS -


Media Relations:

Matt Drage, Head of Corporate Communications
+44 (0) 7976 872 871

Investor Relations:

Frank Hoffmann,
+44 (0) 20 3739 7123

Notes to Editor:

1. ZEAL is an international group of companies reinventing the world of lottery.

2. Specialising in the online lottery space, the company was founded in 1999 as Tipp24 SE and renamed as ZEAL Network SE in 2014.

3. The company is based in London, and its shares are listed on the Prime Standard of the Frankfurt Stock Exchange.

4. Since its incorporation, ZEAL has generated stakes of more than EUR3 billion and, across the Group, paid out more than EUR1.3 billion in winnings.

5. ZEAL's associated company, myLotto24, invented the concept of jackpot-matching lottery betting. It holds the sector's record for the single largest payout of EUR48 million. In Q1 2017, myLotto24, made a life-changing payment of EUR15 million to a winning customer.

6. ZEAL's third quarter report can be accessed at: http://www.zeal-network.co.uk/investors/financial-news/

7. Total Operating Performance is calculated as the sum of Revenue and Other Operating Income as disclosed in the Interim Consolidated Income Statement.

8. ZEAL Group includes all subsidiaries of ZEAL Network SE and the affiliated companies of the independent shareholding myLotto24 Ltd.

9. In the third quarter of 2017, the primary German lottery market experienced an 12% decrease in billings on EuroJackpot and Lotto 6 aus 49 products. ZEAL's performance was 4 percentage points better during the same period.

10.11.2017 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.

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