LeoVegas cancels plans in Malta and restructures its operations in UK
The provider of online casino games and sports betting LeoVegas announced the restructuring of its operations in the United Kingdom and the cancellation of its plans to expand its office in Malta. The measure is part of the company’s strategy to control its costs.
The Swedish operator mentioned as part of its plan a series of ‘strategic measures in the United Kingdom and related cost initiatives’, including the recent withdrawal of the Royal Panda online casino brand from that market.
The Rocket X online gaming brands from LeoVegas were also migrated to their main Rhino multi-brand technical platform. The brands 21.co.uk, UK Casino, BetUK and Slot Boss, were acquired by the leading gaming company in 2018 following an agreement to absorb Intellectual Property & Software Limited, later renamed Rocket X.
These acquisitions expanded the company’s operations in the United Kingdom, but on three separate platforms, generating great “internal complexity,” LeoVegas said. The company’s marketing strategies were unified in LeoVegas UK and Rocket X in 2019. The next foreseeable step will be the technical change regarding efforts to rationalize the company’s costs.
Last year, the Leo Vegas payroll was reduced by a hundred jobs, the company said, so its plans to move to a larger headquarters in Malta in 2021 were cancelled. According to LeoVegas, this will reduce the company’s annual expenses by about € 1.7 million.
LeoVegas estimates that with these restructuring plans, the company will save about € 3.7m per year. In the short term, the restructuring will cost approximately € 6.1m, which will be reflected in the results of the company’s 4th quarter of 2019 that ends on February 14.
The company is currently paying around € 10 million for its investment in Royal Panda, which would have had losses in the United Kingdom also during the fourth quarter. The total revenue of Royal Panda Casino was only € 1.1 million. While the other British brands of the company, had a progressive increase of 15% in their income during the same period.
The increase of almost 5.5% of the company’s shares at the end of the stock market operations last Friday, must have been music to the ears of investors.