Olympic Entertainment Group. Investor update Q4 2013

Transcription

1 Olympic Entertainment Group Investor update Q4 2013

2 Olympic in Snapshot First casino opened in Estonia in land-based casinos in 7 countries Online casino services since 2010 # 1 operator in Baltic countries 3,038 slot machines, 191 gaming tables Shares listed in Tallinn and Warsaw Stock Exchanges Winner of Best Land-based Casino Operator award for 2013 by Totally Gaming Awards Total Revenues (m ) Total Sales Revenue Mix by Segments Estonia Latvia Lithuania Poland Slovakia Belarus Italy EBITDA (m ) 19% 2% 11% 2% 15% 12M m 24% 27%

3 Key Markets Estonia 18 casinos, 737 slot machines, 19 gaming tables Market share 56% Largest competitors - Pafer 14%, Grand Prix 11% and City Casino 7% Latvia 38 casinos, 1,044 slot machines, 18 gaming tables Market share 24% Largest competitors - Alfor and Admiralu Clubs together (Fenikss) 45% and Joker 14% Lithuania 12 casinos, 424 slot machines, 62 gaming tables Market share 69% Largest competitors - Nese Pramogu Bankas 16% and VSGA (Tornado) 12% Poland 3 casinos, 271 slot machines, 39 gaming tables Market share 12% Largest competitors - ZPR and Orbis together ca 25%, Casinos Poland 16% Slovakia 5 casinos, 263 slot machines, 53 gaming tables Market share 76% Largest competitor - Casinos Slovakia 18% Belarus 4 casinos, 187 slot machines Italy 2 casinos, 112 slot machines 3

4 12M 2013 Sales Revenues up 7.8% y-o-y Sales Revenue Bridge by Segments ( 000 ) ' ,721 Sales revenue Quarterly Sales Revenue (m ) 5, ,023 2, ,251 Estonia Latvia Lithuania Poland Slovakia Belarus Italy Sales revenue 2013 Latvia generated the largest portion of Group s sales revenues in 2013 largely due to the acquisition of existing casino chain with 17 locations on 28 June 2013 Active operations in Italy since November 2012 Belarusian market suffering from new regulation, which requires customer identification Sales Revenue Mix by Segments 50,00 40,00 30,00 20,00 10,00 Estonia Latvia Lithuania Poland Slovakia 19% 2% 11% 2% 12M m 24% 0,00 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q Belarus Italy 15% 27% 4

5 12M 2013 Operating Profit up 11.9% y-o-y Operating Profit Bridge by Segments ( 000 ) ,397 1,016 EBIT , Quarterly Operating Profit (m ) 1, , ,783 Estonia Latvia Lithuania Poland Slovakia Belarus Italy EBIT 2013 Best ever operating profit earned in Q Belarusian market suffering from new regulation, which requires customer identification While Latvia accounted for 46.3% of Group s operating profit the y-o-y growth was highest in Poland. Operating Profit Mix by Segments 12,00 10,00 8,00 6,00 4,00 2,00 0,00-2,00 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q Estonia Latvia Lithuania Poland Slovakia Belarus Italy 12% 14% 4% 12m m 46% 24% 5

6 Investment Highlights Leading position in Baltic states Growth Strong management team Strong financials Market leader in Estonia and Lithuania, second largest in Latvia Strong brand awareness in the Baltic market Core focus on expansion in existing markets through acquisitions. Recently acquired casino chain with 17 locations in Latvia Expanding online gaming to the currently established land-based operating countries Development of the first casino hotel in Tallinn, Estonia. The 202-room hotel operated by Hilton will open in end 2015 Proven track record of managing international casino operations in number of countries Experienced management to navigate market fluctuations Cash generating operations Strong balance sheet is the basis for further expansion 6

7 New Casino Hotel Project in Estonia 202-room upscale hotel to be operated by Hilton Total cost of ca 36 million euros Opening planned to December 2015 Casino at 1,600 m 2 will be holding separate areas for slot machines, gaming tables and club poker, special area for VIP players, spacious casino bar with stage area and comfortable lounge. Hotel includes: 202 rooms 26 suites Restaurant seating 122 SPA with pool, fitness centre and saunas Conference rooms seating 720 7

8 Upgraded Online Casino Services January 2010 July August 2013 Olympic Casino Eesti AS, OEG subsidiary, received the first Estonian online gaming license Olympic Casino Latvia SIA, OEG subsidiary, received the second Latvian online gaming license Launching online casino games, poker and sports betting under the new brand OlyBet. 8

9 Appendixes 9

10 Company History Opening of flagship Reval Park Hotel & Casino 1 st casino in Latvia Listing on Tallinn Stock Exchange 1 st casino in Belarus 1 st casino in Slovakia Exiting Romanian market Entering online gaming market Entering Latvian online gaming market OEG founded 1 st casino in Lithuania 1 st casino in Ukraine Exiting Ukranian market Entering Italian market 1 st casino in Poland and Romania Listing in Warsaw Stock Exchange 10

11 Company Vision and Mission Vision Our vision is to be a global casino and resort operator, best known for our excellent service and creative design. Mission To give our guests a customer orientated, secure and safe environment with the finest design and craftsmanship, unparalleled in the industry and supported by the excellence of our name and reputation. 11

12 Key People Armin Karu, Chairman of the Board Founded company 1993 Owns directly (and by controlled companies) 46% of the shares Madis Jääger, CEO Joined OEG in 2010 as CFO Previous work experience as an audit engagement leader in PricewaterhouseCoopers (joined PwC in 2001) Meelis Pielberg, COO Joined OEG in 1996 Country Manager in Estonia Aigar Hain, Country Manager in Estonia Gints Pakarklis, Country Manager in Latvia Saulius Petravičius, Country Manager in Lithuania and Belarus Cezary Gizka, Country Manager in Poland Jozef Skuben, Country Manager in Slovakia Kaido Ulejev, Head of Online Operations 12

13 Business Model AVERAGE BET Average bet of 1 per game HOURS PLAYED Client playing slot on average 900 games per hour = coin-in of EUR 900 HOUSE EDGE Average house edge of 5% for 1 bet results 45 per hour GROSS GAMING REVENUE GGR FOR SLOT = AVERAGE BET HOURS PLAYED HOUSE EDGE AVERAGE BET Average bet of 10 per game HOURS PLAYED Client playing Blackjack on average 60 games per hour = turnover of EUR 600 HANDS PER HOUR With 7 players on the table dealer plays on average 60 games per player HOUSE EDGE Average house edge for reasonable player of 1% for 10 bet results 6 per hour per player GROSS GAMING REVENUE GGR FOR TABLES = AVERAGE BET HOURS PLAYED HANDS PER HOUR HOUSE EDGE 13

14 Consolidated Income Statement 000 Q Q Change 12M M 2012 Change Income from gaming transactions 37,285 34, % 135, , % Other revenue and income 2,647 3, % 9,897 10, % Total revenue and income 39,932 37, % 145, , % Gaming taxes 7,502 7, % 28,937 27, % Lease and rent 3,176 2, % 12,453 10, % Staff costs 9,875 9, % 35,878 33, % Depreciation, amortisation and impairment 1,781 2, % 7,764 10, % Other costs 8,481 7, % 29,004 28, % Operating profit 9,117 8, % 31,783 28, % Total finance income and costs % % Income tax expense -1,444-1, % -4,323-3, % Net profit for the period period (equity holders of the parent company) 7,402 6, % 25,694 24, % 14

15 Consolidated Balance Sheet Change y-o-y Change q-o-q Cash and cash equivalents 44,582 35,973 8,879 37,451 7,131 Other current assets 5,390 17,818-12,428 7,004-1,614 Total current assets 49,972 53,791-3,819 44,455 5,517 Total non-current assets 68,305 55,407 12,898 64,475 3,830 Total assets 118, ,199 9, ,930 9,347 Total current liabilities 15,692 15, ,300 1,392 Total non-current liabilities Total liabilities 16,305 16, ,878 1,427 Total equity of the parent 97,554 87,299 10,255 89,941 7,613 Non-controlling interest 4,418 5,684-1,266 4, Total equity 101,972 92,983 8,989 94,051 7,921 15

16 Consolidated Cash Flow M M 2012 Change Net cash flows from operating activities 35,493 34, % Net cash flows from investing activities -9,005-10, % Incl. purchase of fixed assets -14,851-7, % Incl. acquisition of financial investments -1,379-5, % Incl. proceeds from sale of financial investments 11,150 2, % Net cash flows from financing activities -17,872-21, % Net cash flows 8,616 2, % Cash and cash equivalents at the end of the period 44,582 35, % 16

17 Regulatory Environment and Taxes Estonia Latvia Lithuania Poland Slovakia Belarus Italy Regulatory environment Unit based taxation will change to revenue-based and fixed combination taxation in late 2014 or Online regulation established. Online regulation will be amended in No major regulatory changes expected in near future. New gaming law draft in parliament. We expect new online regulation to be approved in No major regulatory changes expected in near future. No extension of street machine licenses and slot hall licenses. Limited number of casino licenses based on the population. Online gaming is prohibited. No major regulatory changes expected in near future. Tax increase from 1 January 2014; additional 4% on GGR. No major regulatory changes expected in near future. Taxes Unit based taxation. Effective revenue-based tax calculated for 2013 is 16%. Unit based taxation. Effective revenue-based tax calculated for 2013 is 9%. Unit based taxation. Effective revenue-based tax calculated for 2013 is 11%. Revenue based taxation of 50% from GGR. Revenue based taxation of 29% from GGR. Unit based taxation. Effective revenue-based tax calculated for 2013 is 17%. Effective revenue-based tax calculated for 2013 is 53%. 17

18 Thank You