Lottomatica Mulls on IPO to Support Strong Q4 and FY22 Growth

Italian betting and gaming operator Lottomatica confirmed rumors that it was considering an initial public offering among its options going forward but did not provide any further details on its plans.

Considering Going Public

Lottomatica announced that its board, together with the company’s controlling shareholder, Apollo Global Management, “is currently contemplating potential strategic alternatives to support its future growth, including capital markets transactions such as a potential listing” of the company’s shares on a regulated market.

The announcement was made as part of the company’s trading update for the fourth quarter and full-year 2022 consolidated preliminary results. Earlier in the month, there was media speculation that Italy’s biggest gaming and betting operator is considering going public in 2023, looking to raise as much as $1 billion.

Fourth Quarter Results

Lottomatica reported continued strong growth in Q4 driven by organic growth and the acquisition of Italian sportsbook Betflag in November which added “a strong and distinctive brand” to the group’s portfolio and consolidated the group’s position in iCasino and Online.

The operator registered a record quarter for Bets, €6.7 billion ($7.3 billion), up 17% year-over-year, or 11% when excluding the effects of the acquisition of Betflag. Across the business divisions, Online and Sports Franchise were up by 18% and 17%, respectively, and Gaming Franchise grew by 5%.

Q4 revenue grew by 7% to approximately €377 million ($411 million), or 6% when excluding the contributions made by Betflag, while EBITDA is expected to be between €115 million ($125.35 million) and €119 million ($129.7 million), up 11%-15% year-over-year, or 7%-11% when excluding the Betflag acquisition, with the biggest EBITDA contribution, 46%, or 50% with Betflag, coming from Online.

FY 2022 Results

Stating that its full-year results will be published by early March, Lottomatica expects Bets of approximately €22.8 billion ($24.85 billion), revenues of approximately €1.4 billion ($1.52 billion) and EBITDA of between €458 million ($499.2 million) and €462 million ($503.6 million).

Lottomatica expects FY 2022 EBITDA of between €516 million ($562.4 million) and €520 million ($566.8 million), while Betflag synergies of approximately €6 million ($6.54 million) have already been identified and are currently being implemented.

The year generated strong cash flow as operating cash flow is expected to be between €385 million ($419.65 million) and €395 million ($430.55 million), rising to €422 million ($460 million)-€432 million ($470.9 million) with the acquisition of Betflag.