ZEAL Network SE

Good day and welcome to the Zeal Network SE conference call. Today's conference is being recorded. At this time, I would like to turn the conference over to Mr. Jonas Madsen. Please go ahead, sir.

Thank you very much and welcome and good morning to the Zeal conference call for the half-year report. And also thank you for the interest and for joining this call. I hope that you all can hear me loud and clear. I also trust that you have access to the presentation, which should have been distributed to you. But if you haven't, it's available on our website, the website in the investor relations section. Moving on to slide two, you will find the agenda for today's presentation, where we are highlighting the main areas that I will cover before giving you the opportunity to ask questions. So we will start off with a summary of the first six months. followed by a financial update, the guidance for 2020, before we finish off the key takeaways. Let's start with a summary you will find on slide four. I will now hand over to our CEO, Helmut Becke, that will take you through the next slide.

Good morning, everybody. Let me summarize the first six months of 2020. Please look at slide four. We've had a strong start to the year. Billings are up 75%. To interpret this number, you have to consider a number of one-off effects. First, ZEAL billings in the first half of 2020 include Lotto24 and TIP24 billings. ZIL billings in the first half of 2019 do not include Lotto24 billings, except for the second half of May and June 2019. Secondly, the TIP24 billings in the first half of 2020 were influenced by the business model change. So we experienced some customer loss and we lost some products when we made the business model change in October 2019. So if we look at just Lotter24 and compare the Lotter24 first half billings in 2020 with 2019, and that's probably the year-on-year comparison that's least affected by one-offs, we see a 41% billings growth. On margin, we've improved our gross margins. by adding and selling more premium products. We plan to continue to grow our share of premium products, and we can use that extra margin to either boost our short-term profitability or to acquire more customers and thereby invest into future profits. And that's exactly what we did. We did take advantage of the good jackpot situation, particularly the high Euro jackpot jackpots in April to invest more into customer acquisition and thus into growth and future profitability. As a result, we've registered a record number of new customers and already exceeded the original full year guidance on customer acquisition. and all of that at favorable acquisition economics. Fortunately, we have not seen a negative effect of the corona crisis, not on our operations and not on our business. On the cost side, we are realizing the cost synergies and the cost reductions after the Lotto24 takeover faster than anticipated. having already achieved 91% of the planned synergies. Based on all that progress, we've raised our guidance for 2020 on almost all metrics. Last but not least, we've paid out 80 euro cents dividend to our shareholders. Back to you, Jonas.