Zeal Network has published its financial information for the first nine months of 2021, reporting that it continues to grow in revenue, profitability and in customer registrations despite much weaker jackpots throughout 2021.
Zeal posted a 5% growth in billings year-on-year, with €493.2m in billings for the nine-month period ending September 30.
Revenue also increased by 1% year-on-year, climbing to €65.1m, for which the German market was entirely responsible. The market’s gross profit margin remained stable at 12.2%, compared to 12.3% in the first nine months of 2020.
Zeal also attracted 446,000 new registrations during the period, with a cost-per-lead of €27.52. In the same period in 2020, the firm attracted 787,000 new customers at a similar cost per lead (€27.58).
Market conditions for attracting new customers was ‘comparatively weak’, with the jackpot of the European lottery ‘Eurojackpot’ only reaching the €90m mark three times down from six last year, while the mandatory payout mark for the German lottery ‘LOTTO 6aus49’, set at €45m since 23 September 2020, was not reached at all down from three times last year.
Despite this, Zeal improved its profitability in 2021; adjusted EBITDA for the first nine months of 2021 rose by 155.1% year-on-year to €17.6m. The firm noted it has adjusted its costs including a 12.7% decline in personal expenses and a 22.8% reduction in other operating expenses. It also cut its marketing expenses to align with the adverse jackpot conditions.
Jonas Mattsson, CFO of ZEAL Network SE, commented: “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.
“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.”