Super Group’s North American presence hit the skids in the first quarter of 2023, but the parent company of operator Betway, one of the most recognizable online sports betting sites, offset losses with gains on other continents.
In quarterly figures released Wednesday, Super Group announced a 13% year-over-year revenue drop and suffered a loss of $21.7 million in the U.S. and Canada combined.
Super Group ran into problems in both NA countries, which represents 39% of the overall operations. The company said the new Ontario regulation for legal sports betting affected revenue from the Canadian market, which required adjustments to the operation.
Progress in the U.S., meanwhile, has slowed and proven to be more of a challenge than Super Group originally expected. The company cited “how little is being made per state and potentially how structurally inefficient the cost base of a tier-three (or lower) U.S. operator is” as primary hurdles.
Not all bad
However, Super Group still reported revenue of $362.61 million in Q1 2023 which led to a 1% increase in profits from Q1 2022, thanks primarily to improved sports betting margins in Europe, the Middle East, and Africa.
Betway was the primary money generator with $212.6 million in revenue. The company, which also owns the online casino Spin, saw its EBITDA YoY fall from $67.6 million to $37.22 million.
“Super Group has delivered another solid quarter and we remain focused on growing revenue and profits,” Super Group CEO Neal Menashe said. “During the month of March, net gaming revenue was a record high, along with the Operational EBITDA margin of over 20% and this is a strong reminder of the value of operating leverage in our business. We are confident that we will continue to build on another strong quarter across iGaming and sports betting across the world.”
Focus moving forward
Another major cost that bit into Super Group’s profits was the acquisition early in Q1 of Digital Gaming Corporation, which will aid the company in getting into more U.S. markets.
Betway operates in Arizona, Iowa, Colorado, New Jersey, Virginia, Ohio, Indiana, and Pennsylvania. It plans to go live in Q2 of 2023 in Louisiana and has secured markets in Kansas, Missouri, Mississippi, and Massachusetts.