Fortuna sees stakes rise, profits fall on new Czech taxes

Central European sports betting and lottery operator Fortuna Entertainment Group saw profit fall in the first nine months of 2016 despite double-digit gains in betting turnover.

Figures released Monday show sports betting stakes rising 23.4% to €741.6m in the nine months ending September 30, while lottery sales rose 2.6% to €14.4m. The company says the gains were driven by strong online and mobile betting interest, while retail betting gains were confined to single-digits.

Betting gross win rose 15% to €113.8m while lottery win rose 5.1% to 6.4m. But sports betting earnings were down 8.9% to €15.3m and betting profits fell 30.6% to €9.5m due to increased betting taxes in Fortuna’s key Czech Republic market as well as the company’s “planned increase in operating costs to support future growth opportunities.”

On a market-by-market basis, the Czech Republic accounted for 56% of total betting stakes, down one point year-on-year, in part due to retail betting having “moderately declined.” Slovakia’s share of stakes improved two points to 32% despite similar retail shortcomings. Poland’s share of stakes slipped one point to 12% although its share of gross win held firm at 25% and retail betting bucked the trend by growing, albeit “just moderately.”