ZEAL continues to grow in the first nine months of 2022

• New customer growth accelerated
• Highest jackpot in the history of the Federal Republic in July
• Public share buyback offer until November 29, 2022
• Forecast confirmed

Hamburg, 10 November 2022. ZEAL Network SE, the leading German online provider of lottery products, continued to increase its business volume in the third quarter of 2022. While many e-commerce sectors were still affected by declining purchasing power and the effects of inflation, the lottery market, once again, showed its resilience and even benefited from the positive jackpot environment in July.

Increase in billings, sales and gross margin
ZEAL Group's transaction volume increased by ten percent to 544.4 million euros in the first nine months of 2022 (Q1-Q3 2021: 493.2 million euros). At the same time, revenues grew by 14 percent to 74.5 million euros (Q1-Q3 2021: 65.1 million euros).

The market environment for lotteries in Germany in the first nine months of 2022 was better than in the previous year, as the number of bigger jackpots was back on statistical average. For example, the LOTTO 6aus49 lottery reached the EUR 45 million mark two times in two consecutive draws, triggering a mandatory payout in each case. In the European lottery Eurojackpot, a previously unattained record jackpot of EUR 110 million was won in the first nine months of 2022 and cracked by a LOTTO24 lottery club from North Rhine-Westphalia. In July, the Eurojackpot also rose to the highest possible value of EUR 120 million for the first time.

In the first nine months of 2022, ZEAL acquired 501 thousand registered new customers (Q1-Q3 2021: 446 thousand). Here, the increased acquisition costs per registered new customer (cost per lead, CPL) of € 36.42 (Q1-Q3 2021: € 27.57) are primarily based on a special offer for the freiheit+ social lottery in January 2022. Without this effect, the CPL would have increased significantly less at € 34.58. At € 24.1 million, marketing costs in the first nine months of 2022 were 29 percent higher year-on-year (Q1-Q3 2021: € 18.6 million) due to the stronger jackpot situation.

Profitability significantly improved
Personnel expenses decreased slightly year-on-year to EUR 13.9 million (Q1-Q3 2021: EUR 14.5 million), whereas other operating expenses increased only slightly year-on-year to EUR 40.6 million (Q1-Q3 2021: EUR 33.2 million) despite the intense marketing activities. EBITDA thus increased by 25 percent to 22.0 million euros (2021: 17.6 million euros). EBIT and net profit for the period were also significantly higher than the previous year's figures at 15.5 million euros and 12.1 million euros (2021: 11.1 million euros and 7.3 million euros).

Public share buyback offer
Only recently, ZEAL announced a public buyback offer for up to 714.285 shares of the company, corresponding to up to around 3.2% of the share capital. The offer price of € 28.00 per share is approximately 9.9% above the relevant stock exchange price of ZEAL shares. The offer will run, subject to extension, until November 29, 2022.

Forecast confirmed
For fiscal year 2022, ZEAL still plans to expand its market leadership as an online provider of state and other permitted lottery products. Depending on the general conditions – in particular the development of jackpots – the company continues to expect a billings volume of at least EUR 750 million. This forecast is based on an average jackpot development, resulting in a higher growth rate than in the previous year. In addition, ZEAL continues to assume that revenue will be at least EUR 105 million in fiscal year 2022. For adjusted EBITDA, ZEAL expects at least EUR 30 million.

"We are proud of our continued growth trajectory, which proves that we have also taken the right measures in the first nine months of 2022 to improve even further both in terms of customers and results," says Jonas Mattsson, CFO of ZEAL. "With the share buyback offer, we want to further optimize the capital structure of ZEAL Network SE. In addition, we look forward to continuing to make our products accessible to more and more new target groups through targeted partnerships, thus systematically further expanding our reach."

About ZEAL Network SE:   
ZEAL Network SE is the leading German provider of lotteries on the internet. Through the portals LOTTO24 and Tipp24 of the subsidiary LOTTO24, the company brokers customers' tickets to the state lottery companies and to charity lottery operators. The product range includes LOTTO 6aus49, Spiel 77, Super 6, Eurojackpot, GlücksSpirale, lottery clubs, Keno, the Deutsche Fernsehlotterie, Scratch Games, the Deutsche Traumhauslotterie and freiheit+. Founded in Germany in 1999, ZEAL started out as a German lottery broker under the name Tipp24. In 2005, the company went public on the Frankfurt Stock Exchange (Prime Standard) as one of the most successful IPOs in Germany at the time. In 2019, ZEAL took over LOTTO24 AG.  

Press Contact:   
ZEAL Network SE 
Kristin Splieth  
Head of Corporate Communications   
kristin.splieth@zealnetwork.de  
Tel: +49 (0) 40 808117560