Czech taxes & unfavourable sporting results impact Fortuna 2016 profits

Eastern European gambling operator Fortuna Entertainment is looking forward to a new business year, having closed a challenging 2016 for its operations.

Releasing its ‘unaudited’ full-year 2016 financial results, Fortuna detailed that group wagering had reached €1 billion mark (FY 2015: €850 million), driven by higher sports betting player activity in all its key markets.

The operator that services the markets of the Czech Rep, Poland, Slovakia, Romania and Croatia would report an improved group gross-win of €163 million up 10.5% on corresponding FY 2015’s €147 million.

However, Fortuna’s improved revenue metrics would be dampened by poor earnings results as the operator posted an 18% decline in EBITDA to €22 million. Impacted by higher taxes in Czech Rep and burdened by unfavourable sporting results Fortuna would declare corporate profits of €11.2 million (FY 2015: €27 million).

This February, Fortuna governance announced that the group had completed its acquisition of Hattrick Sports Group assets increasing its market presence in Romania and Croatia, while creating new B2B channels for Spain and Germany

Per Widerström, CEO and Chairman of the Management Board of Fortuna Entertainment Group.

“We are pleased to report on strong growth in total Amounts Staked for the full year 2016. Fortuna accepted total bets in the amount of EUR 1,039.6 million, which is 22.6% more than last year. The Amounts Staked grew double digits in all our key markets, primarily driven by the online betting growth and in particular mobile sports betting while Retail grew single digit. Our EBITDA was impacted by the increase in the betting tax rate in the Czech Republic, unfavourable sports results in 2016 and by planned increase of operating costs to support growth opportunities of the company.”