CEO Henrik Tjärnström also expressed interest in the opportunity to expand into the US after the Supreme Court overturned the federal ban on sports betting.
Kindred is the new name of the former Unibet plc. With a market cap of over $3 billion, it is one of the top ten global online gambling operators. As its operations have focused on the Nordics and other European markets, it is not especially well-known in the US.
Overall Q2 revenue was up 33 percent compared to last year, rising from £166 million to £219 million ($288 million). Half-year revenues rose from £319 million to £427 million.
The company has also grown its active player base from 1.1 million in Q2 2017 to over 1.5 million in the latest quarter.
Kindred’s main revenue comes from online sports betting and casino games. Those two verticals generated respective revenue of £104.9 million and £104 million during Q2. Sports betting was helped to record-setting levels by the explosion of betting on soccer’s World Cup.
Tjärnström highlighted as much during his comments:
The World Cup provided a significant all-time high in customer activity and continued strong organic growth, and unexpected results led to a sportsbook margin of 8.2 percent after free bets.
Gross winnings revenue increased 24 percent organically and in constant currencies which means that we are continuing to gain market share. Gross winnings revenue from mobile grew by 29 percent compared to the second quarter last year and amounted to 72 percent of our total Gross winnings revenue.
Online poker is a minnow in compared to the other verticals, generating just £4 million in the quarter and £8.6 million through the first two. Nevertheless, Kindred reports that its product is “the fastest-growing licensed poker network in the industry.”
The interplay between live and online events is working well.
This quarter, Kindred continued its Unibet Open live poker series, on the sunny island of Malta with over 1,000 entrants. Complementing the live series, a second edition of the “Unibet Online Series” was completed, with a total of 25,000 entrants across 84 different online tournaments.
Unibet Poker left the Microgaming network in 2014 and launched its own proprietary online poker platform. The poker room set its focus on recreational players from the start, banning HUDs and other software that could give professional players an advantage.
That big risk appears to be paying off. Poker is back on a growth trajectory within the company’s product verticals.
Kindred’s 2017 annual report included a CEO statement that included no mention of the US market.
The repeal of PASPA and the introduction of state-regulated sports betting, however, has made the market much more attractive. Here’s a slide from the presentation:
Kindred is not altogether a novice when it comes to the US market, either.
The group’s sportsbook is reliant on a contract with Kambi, a relatively unknown brand that is starting to make its mark. Unibet actually created the company before it spun off as a separate entity, and Kindred Chairman Anders Ström is also a member of Kambi’s board.
This has been the apparent strategy all along. Immediately following the SCOTUS decision, Kambi CEO Kristian Nylen divulged initial plans:
We have been working towards this day since our inception, putting in place the foundations to ensure the business would be ready for a legal US sports betting market when it arrived.
Kambi has already proven itself to be the leading end-to-end Sportsbook provider in regulated markets across six continents and I’m therefore confident we’ll have the right product for a US audience.
Although a relative unknown to US players, Kindred’s potential to become a player in the market is not just based on CEO dreaming. Its expertise in locally regulated markets, its focus on recreational players, and its ties to Kambi give it a solid foundation on which it can consider entering the new markets.
If Kindred brings over its sports betting and casino products, Unibet Poker could well tag along.