Press release on the first six months of 2012
– Capital increase fully subscribed
– IPO on 3 July: first quote 20% above issue price
– Conditions for nationwide business still unclear
(Hamburg, 14 August 2012) Lotto24 AG has successfully become an independent company: with a resolution of the Annual General Meeting of Tipp24 SE on 22 June 2012, shares in the former German subsidiary of Tipp24SE were distributed as planned to the latter’s shareholders as a dividend in kind. In the course of the spin-off, Lotto24 AG had previously conducted a capital increase to finance the establishment of business, during which all newly issued shares were subscribed.
On 3 July 2012,Lotto24 was successfully listed in the Prime Standard segment of the Frankfurt Stock Exchange as an independent public limited company: the first quote of EUR 3.00 exceeded the issue price of EUR 2.50 by 20% – making it the most successful IPO of a German company in 2012.
The capital increase has provided Lotto24 with significant equity funding and given it broad scope to exploit growth opportunities. Petra von Strombeck, CEO of Lotto24 AG, states: ‘Lotto24 is excellently placed to benefit from the liberalisation of online lottery brokerage in Germany and exploit the tremendous market opportunities.’
In February 2012, Lotto24 became the first online broker of state-run lotteries to launch operations again in Germany since the second stage of the German State Treaty on Games of Chance (GlüStV) was implemented on 1 January 2009 (Internet ban) – for regulatory reasons, however,still restricted to the federal state of Schleswig-Holstein and with a limited product range not yet widely marketed due to the uncertain legal environment.
As a consequence, business in the first (start-up) half-year 2012 was still extremely limited: from stakes received of EUR 72 thousand, Lotto24 AG generated revenue of EUR 5 thousand (prior year: EUR – thousand), while earnings before interest and taxes (EBIT) reached EUR -1,587 thousand (prior year: EUR -121 thousand). This decline resulted mainly from costs for the spin-off and IPO, as well as expenses in connection with the establishment of business. The net loss for the period rose by EUR -1,026 thousand to EUR -1,141 thousand (prior year: EUR -115 thousand) and earnings per share amounted to EUR -0.08.
Despite the introduction of the ‘First State Treaty to Revise the State Treaty on Games of Chance’ (GlüÄndStV) on 1 July 2012, the conditions for a nationwide roll-out in Germany are still not in place. The approval process has been initiated, but the permit criteria, Internet requirements and advertising guidelines have not been finally decided yet.
Outlook
In view of the ongoing regulatory uncertainties, Lotto24AG continues to assume that it will be able to commence operations in most of Germany’s federal states within a period of twelve months. To this end, it plans to sign agreements with further state lottery companies.Lotto24 aims to subsequently step up new customer acquisition with the aid of advertising activities and expand its product portfolio. The company also plans to offer IT and marketing services to major online portals and lottery companies for the operation of online lottery services.
The complete half-yearly financial report is published on the website of Lotto24 AG in the Investor Relations section: www.lotto24-ag.de.
