Enlabs' sales came in 2% above estimates (EUR 9.4m, estimated EUR 9.3m), much driven by very strong growth in the casino vertical. The casino vertical grew an impressive 57% Y/Y and 6% Q/Q in Q2’19. The betting vertical had a slower development, but still performed a Y/Y growth of 24%, despite negative growth for land-based betting. One-time cost lowered the EBITDA and EBIT which came in -3% respectively -4% below estimates. Adjusted EBITDA and EBIT was in-line with estimates.
The top-line for the gambling segment came in slightly above estimates (EUR 8.60m, estimated EUR 8.49m). The EBITDA, on the other hand, came in below expectations due to one-time costs. The sales for the Media segment came in 11% above estimates, and we believe the underlying strong NDC growth should drive growth, in sales, going forward.
As mentioned in our preview, several factors will help drive strong growth for Enlabs during H2 2019 as well as into 2020.
As Enlabs' business is very scalable, we expect to see a strong margin expansion as the business grows.
Looking beyond 2019, we see several strong growth opportunities in both existing markets as well as new markets.
Following the Q2 report, we will review the case and follow-up with a research update.
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