Company overview

Enlabs Q4’20 – Initial take: The Beast from the East

Redeye Research Note timeStamp 2021/02/23

Redeye views the fourth quarter report as a home run in terms of financial performance. 82% growth YoY with organic growth of 20% YoY. EBITDA grew 89% YoY and had an adjusted EBITDA margin of 32%. They were also setting up for future growth in the Swedish, Ukraine, and Belarus markets.

Global Gaming acquisition has been fully integrated with Enlabs organization and work processes. By eliminating the double roles of the combined organizations has the employee count decreased by 8%. The planned roadmap ahead is a relaunch in Sweden and launching the Ninja brand in Baltics.

Enlabs updated on their roadmap for the markets forward. In Sweden, they prepare for having their product certified and are operationally ready to launch as soon as the license has been approved. In the Ukraine market, three online licenses have been granted, but no operator is live at the moment with a compliant product. The Belarus market has a similar situation, with four online licenses granted at the moment. Enlabs estimates that the Ukraine online market to be worth €500 m and the Belarus €50 m. The primary focus is first the Ukraine market and then the Belarus market. Enlabs report that the Latin American project was closed in December.

The revenue was in line with preliminary numbers, but we note that one-offs were significantly higher than we expected. Hard to see the marketing costs to be on this low level of revenue as Enlabs will start to compete on the competitive Finnish market and start up in two more markets with Ukraine and Belarus.

The situation with the Entain bid is at a standstill as over 10% of the shareholders have not accepted the offer of 40 SEK per share.

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