Kambi, the sports betting and technology services company, is taking drastic action to protect its business from the COVID-19 (coronavirus) crisis, deferring salaries and applying for government support.

The company has confirmed it is applying for financial support from both the Swedish and UK governments, while its board members, CEO, and executive management have also agreed to defer salaries by 20%, 15%, and 10% respectively. The company has also frozen recruitment.

Several costs have also been lower due to the lack of sporting events, including marketing and data costs. In all, the cost savings and reductions are expected to mean operating expenditure in Q2 2020 will be 10-20% lower than in Q4 2019.

Kambi says that, despite worldwide sports cancellations hitting from mid-March, it had a “strong” first quarter, with revenue expected to come in at around €27.5-28m, and its cash balance standing at approximately €45-47m.

However, the company said in the last week revenue has been a mere 25-30% of that seen in the last quarter of 2019. It also warned that, if the sporting calendar remains severely affected, it would lead to an average quarterly outflow of €7-€9m from Q2 onwards.

Reflecting on the situation Kambi CEO, Kristian Nylén, commented:

“Kambi is a technology company powered by skilled and experienced people, all of whom have helped establish Kambi as the global market leader, and who will be pivotal to us pushing on further in the coming years.

“Therefore, it is in Kambi’s long-term interests to retain these staff while also reducing our costs, including payroll, and I firmly believe we have found the right balance in order to achieve this goal. When sports resume, we are ready to gear up to normal activity immediately, and in the meantime, we are being creative and agile in order to offer a high-quality and compliant service to our partners and their end users.”

AYO.NEWS says:

With its massive exposure to global sports, Kambi was always going to be hit hard by the COVID-19 (coronavirus) crisis. With several countries, including the UK, extending lockdowns well into May, and the prospect of a very gradual easing of restrictions, that could take many months, this year is going to be hard for sports services and tech suppliers.

Over the past two weeks we’ve seen many companies, including Inspired Entertainment, Scientific Games, Svenska Spel, and SIS take similar action to protect their businesses during the crisis. 

AYO.NEWS says features the opinion of the author and does not necessarily reflect the views of Pentagon Digital Limited.

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