Revenue for the first half of 2021 dropped from €607.2m to €527.1m due to the impact of the Covid-19 pandemic. Veikkaus, a finance company, attributed this decline to the closure of its slot machines and gaming arcades for nearly four months, compared to the previous year when they remained open until mid-March.
Veikkaus estimated that the Covid-19 restrictions and closure of gaming facilities resulted in a negative impact of €150.0m on its margin for the first half of 2021. Despite the decline, lottery games remained the main source of income, generating €316.6m, accounting for 60.0% of the total revenue. Casino games revenue decreased by 38.5% to €134.2m, making up 25.5% of the revenue. Sports betting revenue increased by 31.4% to €76.2m due to major sports events such as the Uefa Euro 2020 national football team tournament, contributing 14.5% to the total revenue.
Out of the total revenue generated, 55% came from online operations while the remaining 45% originated from retail channels. In terms of costs, total spend decreased by 28.6% to €57.3m, aided by a reduction in sales commissions and location fees by 30.3%. Other costs included employee benefits expenses of €41.2m, service costs of €29.6m, depreciation and impairment spending of €18.5m, and other operating costs of €22.7m.
The operator reported a lower lottery tax of €28.8m, primarily due to the government’s reduction of the tax rate from 12% to 5.5% to support operators during the Covid-19 crisis. Veikkaus ended the first half with a net profit of €330.2m, slightly lower than the previous year’s €332.7m.
Veikkaus’ chief executive, Olli Sarekoski, acknowledged the significant impact of the pandemic on their operations but highlighted their efforts in establishing a responsible gaming environment. The company implemented responsible gambling rules, requiring customers to authenticate themselves and set a loss limit before playing slot machines. Veikkaus aims to prioritize sustainability and become a leading expert in sustainability within the gaming industry.
Meanwhile, Veikkaus announced negotiations with 830 staff members for potential redundancies up to 200 positions. This decision aims to ensure the continuity of their operations amid substantial changes in their operating environment and business volume.
