Veltyco Group PLC (LON:VLTY) Finance Director Marcel Noordeloos caught up with DirectorsTalk for an exclusive interview to discuss their interim results
Q1: First off, congratulations on delivering a strong set of interim results today, could you explain for us what’s driven the performance?
A1: We’ve seen that the introduction of new marketing agreements last year have been very good for us.
At the time of the first merger, which we completed last year, June, the company focussed on sportsbook casino marketing only and since mid-2016, we have added lottery and option trading. The effect of the agreements are shown in the overall Group results including the addition trader deal we announced in September last year and we already saw that in the second half year performance of ’16.
When you consider that the marketing efforts that we do to drive traffic to the platforms basically started last year, in the summer, and they always need a bit of time to really pick up, we are basically now reporting the effects of these marketing activities.
As you know, we have a revenue share deal on all the brands that we do marketing for so basically when you build the database of active players, and that’s increasing, and adding new players to it, you see the effect of the revenue increasing. We’re benefitting from history building and building on new marketing now and building the database.
Q2: Veltyco Group completed two acquisitions over the period, what was the rationale for the deals?
A2: You’re referring to Tippen4you and the Bet90 acquisitions that we announced in the first half year.
To look at Tippen, Tippen is a foreign website focussed on sportsbook players in the German-speaking territories but the business model is basically an affiliate marketing model for sportsbook brands. It has about 14,000-15,000 active members and generates revenue out of the marketing they do. We were using that in the past as an affiliate platform for us so it works both ways, we’re saving money on one end with marketing and the other end, we have some revenue on the existing affiliate business that they had.
Bet90 is actually the one that’s even more interesting. If you look at the current agreements that we have, they’re all global but we have a bit of a restriction in the Betsafe marketing, Bet90 allows us to expand that marketing into geographical areas where we are not active, at this stage, in the sportsbook and casino side of the business. Bet90 was a land-based operator, hardly any online presence and we built a complete new website on a SBTech platform, rolling out the new website, that was launched in July this year, and we’re building a database there with players. We started the operations there in the Nordics, focussing there, it’s a European-wide platform and we also have plans to expand outside of Europe with that brand.
Q3: Now, over the last year you have expanded the focus beyond the casino and sportsbook, where else have you targeted?
A3: We are active in three verticals this year, it’s sportsbook casino, it’s option trading and it’s lottery and that is a good mix. They’re closely related to each other but, as I mentioned, the entering and expansion possibilities are specifically outside of Europe so we’re really targeting there in the months and years we’ll be focussing on that.
Q4: Marcel, what is the outlook for Veltyco Group for the rest of the year?
A4: It’s very good. As we stated in the interim report, we’ve confirmed that the current trading from July to date is still strong and exceeding the current market expectations. Bet90 operations will add a new stream of income to the operations although we expect that to bring bottom-line contribution in the next year. The current business looks very strong and we expect to offer the full year results to exceed the current market expectations and also, based on that actually, we’ve included a note based on these expectations that we are considering paying a dividend in 2018, based on the full year results.
