Customer conversion and retention drives Aspire Global in Q1
Aspire Global has cited improved services for customer conversion and retention as the main reason behind an 81.0% year-on-year increase in revenue during the first quarter, while the igaming solutions provider also saw a rise in earnings.
Revenue for the three months through to March 31, 2019, amounted to €33.2m (£28.6m/$37.3m), up from €18.4m in the corresponding period last year.
Aspire Global said a number of its medium-sized partners experienced a growth spurt in the quarter, boosted by its retention services that allow its partners to bring players back to the site. The provider said this is achieved through generation of big data analysis from various communication channels.
B2B remains the main source of income for Aspire Global, constituting 58.6% of total revenue in Q1 (€21.5m). There was also success for B2C, with growth for the segment mainly driven by sportsbook and the continuous optimisation of marketing and CRM. B2C revenue amounted to €13.7m, up from €8.6m last year.
Aspire Global also noted that six casino brands launched in the first quarter, four of which through partnerships established in 2018 with expected effect in H2 2019. Six brands were shut in relation to ongoing streamlining of the portfolio and the closure of operations in Belgium and Italy.
However, Aspire Global also reported a sharp rise in expenses for the quarter, with this total climbing from €15.2m to €26.4m.
Administrative expenses hit €3.7m in Q1, up from €2.9m last year as a result of higher staff costs and a one-time expense item related to the penalty issued by Swedish regulator Spelinspektionen. Aspire Global in April was fined SEK3m for failing to adhere to self-exclusion regulations in the country.
Distribution costs during the quarter were also up from €11.5m to €21.5, while gaming duties increased from €777,000 to €1.15m.
Despite higher costs, the significant increase in revenue meant Aspire Global was able to report earnings before interest, tax, depreciation and amortisation (EBITDA) of €6.1m, compared to €2.8m in the first three months of last year.
Operating income climbed from €2.4m to €5.2m while income before taxes hit €5.2m, up from €2.4m. Net income before company share in the results of associated companies jumped from €2.3m to €4.9m, while net income and comprehensive income also increased from €1.9m to €4.1m.
CEO Tsachi Maimon has said the results represent a very good start to the year for Aspire Global, highlighting that revenue in Q1 also surpassed the levels it experienced in Q4 of last year.
“I am happy to see that we managed to maintain our growth momentum in the first quarter, quite contrary to our seasonal pattern and despite market head-wind,” Maimon said.
“I’m especially pleased to see that we are growing our B2B business, where both revenues and earnings are steadily increasing, constituting a larger share of company total.
“All in all, revenues in the past 12 months are approaching €120m with EBITDA approaching €25m, and in the coming year, we are hoping to see a growth spurt for some of last year’s key launches.”
In terms of future growth prospects, Maimon said Aspire Global is taking further steps in its global expansion, citing the recent development of its Ukrainian office, which he said will ensure the “appropriate infrastructure and flexibility for various market conditions and coming integrations following future growth”.
“In addition to the appointment of a group CTO, who is based in Kiev as of 2019, we will continue to recruit additional tech talent, more than doubling the Ukrainian working force compared to before,” Maimon said.
“We will be strengthening our sustainability work in the coming year based on several focus areas in each of which we have identified our key challenges and set a clear vision going forward.
“We intend to intensify our efforts over the coming months and to do so in a manner that can be quantified, to enable a clear presentation of our performance as of next year’s annual reports.”