Betsson AB: Year-end report 2017

12% revenue growth driven by Sportsbook
The quarter: 1 October - 31 December 2017:

  -- Group revenue was SEK 1,256.4 (1,118.5) million, an increase of 12 percent,
     with 10 percent organic growth.
  -- Sportsbook revenues grew by 36 percent due to a high sportsbook margin of
     8.2 percent. Organic growth in Sportsbook turnover was 7 percent.
  -- Operating income (EBIT) was SEK 218.4 (265.1) million, a decline of 18
     percent, mainly due to negative currency impact, negative contribution from
     recent acquisitions and increased marketing.
  -- The operating margin for the quarter was 17.4 (23.7) percent. 
  -- After the quarter: Company has implemented efficiency measures that will
     reduce net costs with SEK 50-60 million annually. Restructuring costs of
     approx. SEK 15 million will be taken in Q1 2018.

The period: full year 2017:

  -- Group revenue increased by 15 percent to SEK 4,716.5 (4,117.3) million,
     with 9 percent organic growth.
  -- Operating income (EBIT) was SEK 882.2 (946.4) million.  
  -- Net profit was SEK 786.5 (878.0) million, corresponding to SEK 5.68 (6.34)
     per share.
  -- Operating cash flow amounted to SEK 946.7 (1,168.5) million. 
  -- The Board of Directors proposes to the AGM that SEK 393.1 (658.9) million,
     which corresponds to SEK 2.84 (4.76) per share, is distributed to
     shareholders. This is according to the new dividend policy, as communicated
     in March 2017.

Key data

SEK m                       Q4 2017  Q4 2016  -     Jan-Dec     Jan-Dec     -   
                                                     2017        2016           
                                                                                
Revenue                     1 256,4  1 118,5   12%     4 716,5     4 117,3   15%
Gross profit                  903,0    830,6    9%     3 419,4     3 078,0   11%
Operating income (EBIT)       218,4    265,1  -18%       882,2       946,4   -7%
EBIT margin                   17,4%    23,7%   -6%       18,7%       23,0%   -4%
Net income                    198,9    243,6  -18%       786,5       878,0  -10%
Earnings per share (SEK)       1,44     1,76  -18%        5,68        6,34  -10%
Operating cash flow           278,9    332,2  -16%       946,7     1 168,5  -19%
Casino revenue                867,3    823,7    5%     3 437,9     2 907,8   18%
Sportsbook gross turnover   5 965,4  6 117,7   -2%    23 117,5    24 392,1   -5%
Sportsbook revenue            359,3    264,4   36%     1 140,3     1 080,4    6%
Sportsbook margin after        8,2%     6,6%              6,9%        6,5%      
 free bets                                                                      
Deposits                    4 362,4  3 947,1   11%    16 308,0    14 457,6   13%
Active customers            615 499  573 277    7%                              

Message from the CEO, Pontus Lindwall:

"Revenue for the fourth quarter was SEK 1,256.4 (1,118.5) million, an increase
by 12 percent compared to the same quarter 2016. The growth was driven by
sportsbook, where we saw a high margin of 8.2 percent and growth in gross
turnover excluding currency effects. The growth indicates that Betsson's new
mobile web sportsbook, which was launched on core brands during the quarter,
has been well received by customers so far. Casino revenue growth was strong in
region Western Europe, but the region Nordics showed a decline in Casino due to
strong competition. 

Operational income for the quarter was SEK 218.4 (265.1) million, a decline by
18 percent compared to the same quarter 2016. Increased marketing spend,
currency effects and negative contribution from acquired companies had a
negative impact on earnings. 

Actions to improve business
We have identified and started to implement a number of improvements on both
the product and the marketing side. The launch of the new front-end system for
Casino and Sportsbook on desktop and apps should be completed during 2018.
Betsson will focus marketing spend on key markets with the ambition to achieve
a higher return on investment. As an example, we have scaled back on marketing
volumes for the UK. 

During the first quarter 2018, Betsson restructured the operations. The new
flatter organisation will enable the Company to work more efficiently. 

In order to ensure that the operational companies owned by Betsson AB lead the
way within responsible gaming, Betsson AB ordered an independent review in
December 2017. The report recognised that responsible gaming is taken seriously
at Betsson and also offers players a wide selection of responsible gaming
tools, but it also pointed out some potential enhancements to improve work
further within this area. Actions are in place and the results will be followed
up closely by Betsson AB management and the Board of Directors, and also by
reporting KPI's in the interim reports going forward. 

When I stepped in as CEO in September, my first action was to analyse the
situation the company was in and together with management set a plan on how to
bring Betsson back to higher growth and earnings. It will take some time until
I am satisfied, but we are systematically implementing actions to improve
performance and expect to see results towards the end of the year." 

Information on the presentation
Betsson invites media, analysts and investors to Betsson's office at
Regeringsgatan 28, Stockholm, Sweden, on Thursday, 8 February, 2018 at 09:00
CET, for the presentation of the interim report with CEO Pontus Lindwall and
CFO Kaaren Hilsen. The presentation will be held in English and followed by a
questions and answers session. It is also availa-ble via webcast and conference
call. 

To participate by phone, please dial:
UK: [phone]
SE: [phone]
US: [phone]

To watch the webcast of the presentation:
visit www.betssonab.com or
https://edge.media-server.com/m6/p/o23u2imd

Contacts
Pontus Lindwall, President and CEO [phone]
Kaaren Hilsen, CFO [phone], [e-mail]
Pia Rosin, VP Corporate Communications  [phone],
[e-mail] 

This information is information that Betsson AB is obliged to make public
pursuant to the EU Market Abuse Regulation. The information was submitted for
publication, through the agency of the contact persons set out above, at 07.30
CET on 8 February 2018.

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