Yearbook - Olympic Entertainment Group

YEARBOOK
2013
Estonia • Latvia • Lithuania • Belarus • Poland • Slovakia • Italy
Estonia
Russia
Sweden
Latvia
Lithuania
Belarus
Poland
Germany
Ukraine
Czech
Slovakia
Austria
Hungary
Italy
With passion and dedication.
Over 20 years.
In 7 countries.
2
• Countries
7
• Casinos
82
• Floor area
28,031 m2
• Gaming tables 191
• Slot machines 3,038
• Employees 2,515
• Shares are listed in Tallinn and
Warsaw Stock Exchanges
3
Cornerstone for
new growth
Hilton Tallinn Park
• 1,600 m2 flagship Olympic Casino
• 200 rooms, 25 suites
• Restaurant capacity for 170 people
• Conference centre for 720 people
• SPA with pool, fitness
centre and saunas
Armin Karu
Chairman of the Board
Olympic Entertainment Group
Twenty years of operations might often mark
the peak of one’s career but for Olympic
Entertainment Group 2013 was rather a year
when we laid the cornerstone for new growth
and when our ambitious goals took shape.
The decision announced in July to invest
EUR 36 million in the development of the Group’s
first true casino hotel in Tallinn, Estonia was the
strongest signal yet of our ambitions. The hotel,
which is due for completion at the end of 2015,
will be operated by Hilton Worldwide and will
notably set new and more spacious standards
for our future flagship casinos.
Other significant steps taken in 2013 helped
grow business volumes in Latvia and created
preconditions for similar processes in Slovakia
and Italy.
On the online gaming market front, we
launched an absolutely brand new trademark –
OlyBet. As the name implies, we have now added
sports betting to our product portfolio. We see
the synergy between land-based and online
services as our clear competitive edge, where
customers are provided mobile and modern
4
Winning the 2013 title of Best
Land-Based Casino Operator
of the Year at the traditional
ceremony of Totally Gaming
Awards held in London
was a fitting crown for the
achievements of OEG in its first
20 years of operations.
solutions from an established and secure gaming
operator.
Most importantly, however, from the first
year of our new decade we expect to make major
progress in totally new markets and are certain
that the biggest growth in the near future will
come from those markets in which we are not
yet present. I can assure you that we have now
firmly laid the cornerstone for new growth and
our whole team is ready for the next bold step. u
5
A good result is a
strong incentive
Madis Jääger
CEO
Olympic Entertainment Group
The best word to characterise 2013, the twentieth
year of operations of Olympic Entertainment Group
(OEG), is determination. It was our perseverance in
the choice of games, in customer service and in the
quality of operational management that enabled
us to achieve stable growth throughout the year.
In 2013, the Group’s sales revenue totalled
EUR 145.3 million, which is 7.8% more than a year
earlier. It was strongly influenced by the result in
Latvia which in turn was based on the acquisition
of a local casino chain with 17 gaming venues.
The operating profit of OEG amounted to
EUR 31.8 million, an increase of 11.9% year-on-year.
46.3% of the operating profit came from Latvia
which saw good gains in volumes. Operations
in Poland went up strongly and amounted to
EUR 4.5 million in operating profit, up by
EUR 1.9 million or 72.9% year-on-year. The third
quarter was especially historic for OEG as the
Group earned EUR 10.2 million – its highest ever
quarterly operating profit.
Last year OEG paid out dividends 10 cents per share
to its shareholders. This is comparable to the payout
of reducing share capital of the preceding year.
6
I believe that the stable growth in recent years
has met our shareholders’ expectations, but OEG
has also increased its role and responsibility in
society in an equally stable manner. Last year, OEG
paid more than EUR 50 million in state taxes. It’s
a record amount and almost double the net profit
earned during the same period (EUR 25.7 million).
Gaming tax amounted to more than EUR 32 million
and is being used for supporting culture, sports and
the social sphere in most of countries we operate in.
Stable growth is significant for the whole
team, creating the necessary preparedness and
high motivation for implementing ambitious
development plans. u
Operating Profit Mix by Segments
Estonia
24%
Latvia
46%
Lithuania 12%
€31.8m
Poland
14%
Slovakia
4%
Belarus
0%
Italy
0%
Total Sales Revenue Mix by Segments
Estonia
24%
Latvia
27%
Lithuania 15%
€145.3m
Poland
19%
Slovakia
11%
Belarus
2%
Italy
2%
The activities of OEG in 2013 were highly recognized by
stock market analysts who named OEG the second best
listed company on Baltic stock exchanges of
NASDAQ OMX in investor relations.
7
Summer of big
decisions
In November 2013, Radisson Blu Hotel Olümpia
became the new home for the Estonian
flagship casino of OEG for the next two years.
Meelis Pielberg
•
•
•
•
•
•
•
COO
Olympic Entertainment Group
In 2013 OEG made several big decisions which had
been in the pipeline and which will have a major
impact on both the Group’s development and its
results for years to come.
The most important of these steps, which
directly impacted the financial year 2013, was the
acquisition of SIA Altea which operated 17 casinos
in Latvia. By the end of the first half of 2014, the
casinos will be gradually modernised in compliance
with the highest quality and design standards of
Olympic Casino.
Undoubtedly the most important investment
decision that we made last year was to build a new
casino hotel in Tallinn at a cost of EUR 36 million.
For the duration of the construction period,
which will last a little longer than two years, we
moved our flagship casino to new, more spacious
premises. Once again the team of Olympic
Casino Estonia showed its enormous potential
by relocating the entire casino, complete with all
necessary systems, to a new location in a matter of
only hours, opening the new casino in less than 12
hours after the shutdown of the old one.
In August we launched our new online gaming
brand OlyBet, significantly expanding our portfolio
8
60 slots
10 gaming tables
VIP lounge with 3 tables
Poker hall with 6 tables
OlyBet Sports Bar
Area for live performances
Open 24/7
ESTONIAN
COMPANIES´
COMPETITIVENESS
RANKING
of online products. OEG, which holds Estonia’s first
license for remote gaming, also obtained a similar
license in Latvia in 2013 while in Lithuania we were
issued a license for sports betting. On the basis
of current casino lounges, we opened 10 OlyBet
Sports Bars in Estonia and 7 in Latvia, all of which
have quickly become popular among sports fans.
In our existing markets, there are clear growth
expectations for the VLT slot casino segment in the
Slovak market, as well as for the completion of our
expansion in Italy. The main objective for the year,
however, is to expand OEG casino operations into
new markets. u
OLYMPIC ENTERTAINMENT
GROUP
THE MOST COMPETITIVE
SERVICE ENTERPRISE 2013
In October 2013, OEG was named Estonia’s Most Competitive
Service Enterprise, a title that is jointly awarded each year by
Enterprise Estonia, the Estonian Chamber of Commerce and
Industry and the Estonian Employers’ Confederation.
9
consolidated financial statements
Consolidated statement of financial position
(EUR ‘000)
(EUR ‘000)
31.12.2013
31.12.2012
44,582
35,973
Receivables and prepayments
2,946
2,730
Inventories
1,001
Current assets
31.12.2012
240
241
Current liabilities
Cash and cash equivalents
Financial investments
1,086
Prepaid income tax
357
Total current assets
49,972
13,773
280
1,036
53,792
Borrowings
Trade and other payables
13,494
Income tax payable
776
Provisions
1,181
Total current liabilities
12,827
827
1,585
15,691
15,480
246
140
Non-current liabilities
Deferred tax liabilities
Non-current assets
Deferred tax assets
1,077
Financial investments
3,396
Other long-term receivables
670
Investment property
1,784
Property, plant and equipment
26,513
Intangible assets
34,865
Total non-current assets
68,305
118,277
TOTAL ASSETS
1,038
2,035
712
Long-term borrowings
Total non-current liabilities
Total liabilities
369
596
615
736
16,306
16,216
60,532
60,532
1,785
19,611
30,226
55,407
109,199
EQUITY
Share capital
Statutory reserve capital
1,210
Other reserve
Currency translation differences
Retained earnings
Total equity attributable to equity holders of the parent
Non-controlling interest
Total equity
235
-1,204
36,782
97,555
4,416
101,971
TOTAL LIABILITIES AND EQUITY
ASSETS
10
31.12.2013
118,277
0
141
-700
27,327
87,300
5,683
92,983
109,199
consolidated financial statements
Consolidated statement of financial position
LIABILITIES AND EQUITY
11
consolidated financial statements
12
Consolidated statement of comprehensive income
(EUR ‘000)
Income from gaming transactions
Revenue
Other income
Total revenue and income
Cost of materials, goods and services
Other operating expenses
Staff costs
Depreciation, amortisation and impairment
Change in the fair value of investment property
Other expenses
Total operating expenses
Operating profit
Interest income
Interest expense
Foreign exchange losses
Other finance income and costs
2013
2012
135,921
125,479
568
1,224
9,330
145,819
-3,044
-66,826
-35,878
-7,763
-1
-524
-114,036
31,783
163
-17
-59
9,242
135,945
-2,907
-61,036
-33,005
-10,380
107
-327
-107,548
28,397
351
-157
-47
-623
436
Profit before income tax
31,247
28,980
Net profit for the period
26,924
25,019
25,694
24,199
Total finance income and costs
Income tax expense
Attributable to the parent
Attributable to non-controlling interest
-536
-4,323
1,230
583
-3,961
820
Other comprehensive income:
Items that may be subsequently reclassified to profit
Currency translation differences
Total comprehensive income for the period
Attributable to the parent
Attributable to non-controlling interest
-504
1,076
26,420
26,095
25,190
25,275
1,230
820
REPORT OF THE INDEPENDENT AUDITOR ON THE SUMMARY FINANCIAL STATEMENTS
To the Shareholders of Olympic Entertainment Group AS
The accompanying summary financial statements, which comprise the consolidated statement of financial position as of
31 December 2013 and the consolidated statement of comprehensive income for the year then ended, are derived from the
audited consolidated financial statements of Olympic Entertainment Group AS and its subsidiaries for the year ended
31 December 2013. We expressed an unmodified audit opinion on those consolidated financial statements in our report
dated 26 March 2014.
The summary financial statements do not contain consolidated statements of cash flows and changes in equity, accounting
policies and disclosures required by International Financial Reporting Standards as adopted by the European Union. Reading
the summary financial statements, therefore, is not a substitute for reading the audited consolidated financial statements of
Olympic Entertainment Group AS.
Management Board’s Responsibility for the Summary Financial Statements
Management Board is responsible for the preparation of a summary of the audited consolidated financial statements that are
derived from the audited consolidated financial statements.
Auditor’s Responsibility
Our responsibility is to express an opinion on the summary financial statements based on our procedures, which were conducted
in accordance with International Standard on Auditing 810, "Engagements to Report on Summary Financial Statements."
Opinion
In our opinion, the summary financial statements derived from the audited consolidated financial statements of
Olympic Entertainment Group AS and its subsidiaries for the year ended 31 December 2013 are consistent, in all material
respects, with those consolidated financial statements.
AS PricewaterhouseCoopers
Tiit Raimla
Auditor’s Certificate No.287
Lauri Past
Auditor’s Certificate No.567
26 March 2014
AS PricewaterhouseCoopers, Pärnu mnt 15, 10141 Tallinn, Estonia; Audit Company’s Registration No.6
T: +372 614 1800, F: +372 614 1900, www.pwc.ee
The Ambassador
of Fair Play
Having first entered the online gaming market in 2010,
on 1 August 2013 OEG launched OlyBet, a new online
gaming environment unifying sports betting, online
casino and online poker.
Since its launch, OlyBet has been offering the widest
choice of sports events amongst all service providers
licensed in the Baltic countries, including prematch and
live betting. Deploying the new platform also allows
OlyBet to offer more than 300 different casino games
from a wide variety of producers as well as online poker
through the Microgaming network.
By the end of 2013, all Olympic Casino lounges in
Estonia and Latvia had been converted into completely
new OlyBet sports bars, creating a wider synergy of landbased and online operations of OEG.
Thanks to radical product innovation and a successful
launch campaign, it took OlyBet only a few months to
reach top-level brand recognition in Estonia. From the
start of August, OlyBet also expanded its operations
into Latvia, based on the recently acquired remote
gaming license. By the end of the year, the company
was additionally licensed to start providing services in
Lithuania.
The new ambassador of fair play has arrived, bringing
excellent games to an increasing number of people.
14
15
CONTACTS
www.olympic-casino.com
www.olybet.com
ESTONIA
slovakia
LATVIA
BELARUS
LITHUANIA
ITALY
Olympic Casino Eesti AS
Pronksi 19, 10124,
Tallinn, Estonia
Ph: +372 667 1255
E-mail: estonia@oc.eu
Olympic Casino Latvia SIA
Kronvalda 3, LV-1010,
Riga, Latvia
Ph: +371 678 92975
E-mail: latvia@oc.eu
Olympic Casino Group Baltija UAB
Konstitucijos ave. 12, LT-09308,
Vilnius, Lithuania
Ph: +370 526 38638
E-mail: lithuania@oc.eu
Olympic Casino Slovakia S.r.o.
Viedenskà cesta 7, 851 01,
Bratislava, Slovakia
Ph: +421 908 789 321
E-mail: slovakia@oc.eu
Olympic Casino Bel IP
Kulman 11, 220100,
Minsk, Belarus
Ph: +375 17 289 55 27
E-mail: belarus@oc.eu
The Box S.r.l.
Via Thomas Edison 8, Cerro Maggiore, 20023,
Milan, Italy
Ph: +39 331 420672
E-mail: italy@oc.eu
poland
Casino Polonia-Wroclaw Sp.z o.o.
Panska 73, 00-834,
Warsaw, Poland
Ph: +48 22 351 7250
E-mail: poland@oc.eu
Olympic Entertainment Group AS
Pronksi 19, 10124,
Tallinn, Estonia
Ph: +372 667 1250
E-mail: info@oc.eu