Lotto24 AG: 2014: Strong growth in billings and revenues, market leadership almost doubled, new customer target narrowly missed, 2015 guidance

Lotto24 AG  / Key word(s): Preliminary Results

20.01.2015 07:29

Dissemination of an Ad hoc announcement according to § 15 WpHG, transmitted
by DGAP - a service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.


Ad hoc announcement acc. to Sec. 15 WpHG

Lotto24 AG: 2014: Strong growth in billings and revenues, market leadership
almost doubled, new customer target narrowly missed, 2015 guidance

(Hamburg, 20 January 2015) According to preliminary figures, Lotto24 AG
achieved growth rates of 168% and 180% in its fiscal year 2014 with
billings of almost EUR 82 million (prior year: EUR 30.5 million) and
revenues of around EUR 8 million (prior year: EUR 2.8 million), thus fully
reaching its forecast of strong growth for both KPIs. At 9.5%, gross margin
easily exceeded both the prior-year figure (9.1%) and the respective

Online lotteries experienced strong growth in Germany during 2014 and
Lotto24 played a major role in this trend. Although total revenues of the
German Association of State Lottery Companies (»Deutscher Lotto- und
Totoblock, DLTB«) were down slightly by -0.7% in 2014 (prior year: +10%)
due to a comparatively poor jackpot situation, the online revenues of
state-owned companies and private brokers rose by more than 50% to around
EUR 390 million (prior year: EUR 253 million), according to calculations of
the German Lottery Association (»Deutscher Lottoverband«). According to
these figures, the online revenues of the 16 state-owned lottery companies
grew in total by 30% to around EUR 285 million (prior year: EUR 219
million). With billings of almost EUR 82 million, the market share of
Lotto24 AG almost doubled from around 12% to about 21%. This provides
strong confirmation of Lotto24 AG's business model and strategy.

Due to the lack of jackpots for Germany's »Lotto 6aus49« lottery, the
preliminary calculation of 284 thousand new customers in 2014 fell just
short of the targeted 300 thousand (dependent on the jackpot situation).
The preliminary total number of registered customers as of 31 December 2014
was therefore around 521 thousand (prior year: 237 thousand). With
marketing expenditure of around EUR 13 million (prior year: EUR 7.3
million), cost per lead (CPL) amounted to approximately EUR 45 (prior year:
EUR 35.25). As forecast, preliminary earnings from operating activities
(EBIT) and net profit for 2014 amounted to around EUR -14 million and
almost EUR -16 million, respectively (prior year: EUR -11.3 million and EUR
-10.5 million) due to investment in further expansion of the company's
market leadership.

In 2015, Lotto24 AG plans to stabilise its market leadership with moderate
growth in market share. As part of this strategy, the company will focus
more strongly on optimising CPL in combination with a significant
year-on-year reduction in marketing expenditure. Depending on the jackpot
situation, this is expected to result in much slower new customer growth.
Lotto24 will continue to invest consistently in the expansion of its
business and market shares while at the same time placing greater strategic
emphasis on improving earnings. At the same time, the company will continue
the insourcing of its strategically important IT division started in 2014
in order to achieve greater long-term independence, pave the way for
further cooperation agreements in the field of B2B and business services,
and implement its own development needs more flexibly, quickly and easily
in future. Assuming that the regulatory environment remains unchanged, and
depending on the jackpot situation, Lotto24 AG therefore expects a strong
increase in billings of up to 50% and a slight year-on-year improvement in
gross margin for its fiscal year 2015. Moreover, losses of the two KPIs
EBIT and net profit are expected to be lower than in the previous year.

The Annual Report 2014 is to be published on 26 March 2015.

20.01.2015 The DGAP Distribution Services include Regulatory Announcements,
Financial/Corporate News and Press Releases.
Media archive at and

Language:     English
Company:      Lotto24 AG
              Straßenbahnring 11
              20251 Hamburg
Phone:        +49 (0)40 8 222 39 0
Fax:          +49 (0)40 8 222 39 70
ISIN:         DE000LTT0243
WKN:          LTT024
Listed:       Regulierter Markt in Frankfurt (Prime Standard); Freiverkehr
              in Berlin, Düsseldorf, Hamburg, München, Stuttgart
End of Announcement                             DGAP News-Service