Kindred Group has published its unaudited interim report for the period from January to September 2023. Revenue in the third quarter remained stable, leading to positive year-to-date results.
In Q3, Kindred’s revenue reached GBP 283.9 million (roughly $360 million), representing an increase of 2%. Gross winnings revenue from the business-to-customer division increased by a single percent to GBP 274.7 million ($348 million). In the meantime, underlying EBITDA increased by 6% to GBP 42.6 million ($54 million).
Kindred also reported that profit before tax and profit after tax were GBP 15.1 million ($19.1 million) and 12.6 million ($16 million), respectively. Earnings per share in Q3 reached GBP 0.06 ($0.076) and the company recorded a 7% increase in active customers (now 1,563,762).
The company reported a decline in cash flow, which amounted to GBP 24.5 million ($31 million) at the end of the quarter.
The year-to-date revenue stands at GBP 897.6 million ($1.137 billion), representing an 18% increase. Gross winnings from the B2C segment increased by 16% to GBP 870.3 million ($1.1 billion), while underlying EBITDA increased by 64% to GBP 147.7 million ($187.2 million).
Profits before and after tax for the year-to-date period were GBP 78.6 million ($99.6 million) and 65.9 million ($83.5 million), respectively. Earnings per share reached GBP 0.30 ($0.38). The overall free cash flow for the period was GBP 56.5 million ($71.6 million).
Kindred added that it expects FY 2024 underlying EBITDA of GBP 250 million ($317 million). The company is still assured that it will achieve its EBITDA target of GBP 200 million ($253.5 million) in 2023.
Kindred to Exit North America & Lay Off Workers
Nils Andén, Kindred’s interim chief executive officer, commented on the results, reporting continued growth in Kindred’s casino segments in the UK and Netherlands. Despite that, the company was set back by a number of regulatory challenges.
While the company remains a leader in the Netherlands, its sports betting business underperformed, leading to suboptimal overall performance. Still, Andén expects Kindred to meet its EBITDA target unless it is further set back by unimpressive activity within the betting sector.
In the meantime, Kindred continues its strategic review as the company seeks to improve shareholder value through a third-party transaction. CEO Andén used the opportunity to announce two major operational initiatives, including the company’s controlled exit from the North American market, a reduction in headcount and operational costs and an increased focus on core markets.
Taken together, expected annualized gross cost savings from exiting North America and reducing headcount and other operational costs are estimated to be approximately GBP 40 million.
Nils Andén, CEO, Kindred
Andén is confident that Kindred is in a good position to do better and deliver favorable growth across its core markets.