Novomatic loses C$ 380 million 2020

Novomatic loses C$ 380 million 2020

2021-04-06

Last year for a lot of landbased casinos and providers was not very successful. That also was the case for the Austrian gaming group Novomatic. As shown in the 2020 annual financial report, Novomatic generated a loss of CA$ 380 million or EUR 262.8 million.

Loss of sales of around a third

The loss was due to the effects of the global corona pandemic, Novomatic said. The closure of casinos, amusement arcades and betting offices as well as the cancellation of sporting events have led to a decline in sales worldwide. While this was still 2.6 billion euros in 2019, it fell by around a third to 1.7 billion euros in the reporting period.

Due to the economic setbacks, the profit situation has also deteriorated massively, according to the Novomatic management. While the bottom line in 2019 was a profit of 97.3 million euros, the overall result turned into significantly negative territory last year.

Positive development on the cost side

Despite the massive slump in sales and profits, Novomatic sees itself as being well positioned for future challenges. The reason for this are achieved cost savings in the three-digit million range.

In the annual report Novomatic explains:

In order to counteract this decline in business, numerous measures to optimize costs and increase efficiency were taken across the Group.

For example, the company reduced its marketing expenses due to the coronavirus from 120 million euros in 2019 to 77 million euros last year. At the same time it was possible to reduce personnel costs from EUR 772.8 million to EUR 606.9 million.

These measures helped to reduce net debt by 10.2%. Despite these successes, it was decided at the Annual General Meeting not to distribute a dividend for the 2020 financial year.

However, Novomatic sees itself well equipped for the future. The company expects to be able to at least partially make up for the losses in sales and earnings from 2020 this year. Also Greentube helps with this goal. The online gambling software developper of Novomatic releases a lot of more online slots in 2021.

Source

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