Allwyn Ag

Ladies and gentlemen, thank you for standing by. I am Gail, your course call operator. Welcome and thank you for joining the OPAP conference call to present and discuss the OPAP-SA first quarter 2020 financial results conference call. At this time, I would like to turn the conference over to Mr. Camille Ziegler, Executive Chairman of OPAP-SA. Mr. Ziegler, you may now proceed.

Thank you very much, operator, and good afternoon or good morning to everybody. and welcome to OPAP's first quarter 2020 investor conference call. Being in the position to open the call more than after four years, a lot has changed when it comes to both OPAP as well as the overall environment. What remains unchanged is that during this rather long journey, OPAP has been continuously and successfully addressing severe macro-challenges, regulatory hurdles and several business issues. And we believe that the current unprecedented conditions will be no exception. Having served as OPAP CEO and currently as Chairman right from the first moment after EMA-Delta became the largest showholder in late 2013, which is almost seven years. The company's management has always been committed into the creation of long-term and sustainable value for all of our shareholders. Allow me in this place to personally thank our former CEO, Damian Cope, for his valuable contribution. and also allow me to introduce our new acting CEO, Jan Karas. Jan has also been a key member of this effort and having closely worked with him during this period, I believe he has both the necessary experience in the field as well as proven track record to drive forward OPAP's business growth. He will have both mine and also BODs, full support, and firmly I believe that our cooperation will be up to the high standards that the company has set over the last couple of years. Jan will also share his thoughts with you, but just before that, let me pass over the call to our CFO, Pavel Mucha, who will now walk you through our first water financials. Pavel, please.

Thank you, Kamil, and good afternoon to everybody. As I am sure you are aware, Q1 2020 was split to two very different parts for the vast majority of businesses, including OPAB. Most KPIs were positive up to mid-March, whereas from that point onwards the Greek economy and OPAB was shattered by the negative effects of the COVID-19 outbreak and the subsequent business lockdown. As such, I believe that rather than referring to Q1 performance of individual macro indices, it makes more sense to point out GDP projections for the year, ranging between minus 4% to minus 18%, with European Commission projecting minus 9.7% for Greece, and sharp recovery is expected in 2021. Taking into account that Q1 GDP declined already by 1.2%, the performance from April onwards is expected even worse. In any case, the range is rather wide on the back of Greece's material dependence on tourism, which contributes indirectly more than 25% of GDP, directly around 12%, and in conjunction with restriction measures as well as uncertainty of the spread of the virus going forward. On the positive side, Greece has admittedly done a great job when it comes to COVID confrontation measures, which has in turn helped to partial return to normality. On top, discussions regarding the EU fiscal stimulus seem to be taking the right path with a positive flavour for Greece. When it comes to OPAP, our performance during the quarter was in line with our expectations, which we shared with you in our full year results. Turning to slide 7 of our presentation, GGR overall declined by 17%, but it increased by 1.7% year-on-year up until the lockdown. Q1 revenues dropped across all segments, because 99% of our sales channels were closed down during the lockdown. Up until the lockdown on March 14th, betting took the lead for the quarter, posting a sizable 3.2% growth, continuing a streak of positive like-for-like months. Lotteries year-on-year dropped, reaching 19.4% for the quarter, but stood almost flat prior to the lockdown. Joker's significance in our portfolio grew during the lockdown due to online good jackpot series and due to our decision to add one more draw per week so as to support the game's mechanics and drive revenues. Finally, VLT's performance up to the lockdown was more than satisfying with revenues up by 21.5% held by both a growing year-on-year number of installed machines as well as improving maturity of gaming halls. Moving on to profitability and turning to slide 8, please. EBITDA for the quarter reached 86.4 million, which is down by 15.6% year-on-year. This decline is obviously a result of lockdown, although the group managed to be profitable in March, despite the fact that the company's revenues were down by 99% for more than half of the month. More importantly, our margin shaped at 26.3% versus 25.8% in Q1 2019, demonstrating the resilience of OPAP's operating model. When it comes to cost overview, our total OPEX for the quarter reached 57.7 million versus 61.9% in Q1 2019, which is lower by 6.9% year-on-year. payroll expenses were cut flat and marketing expenses were cut by as much as 15%. Stichemann's contribution on Q1 EBITDA reached 4.6 million, which we think is indicative of its long-term potential. That said, Stichemann has also experienced a sizable year-on-year drop in its April figures due to the lack of sports activity But more importantly, the company remained in black numbers even during this extraordinary period. The net profit reached 36 million, lower by 37.8% year-on-year due to lower operating profitability as well as higher interest expenses and an increased effective tax rate. With that, I am passing you over to Jan.