Super Group (SGHC) Ltd. Q4 FY2024 earnings call

• 2024 was an outstanding year where Super Group achieved refining its global footprint, focusing on key growth markets, fine-tuning products/tech, and realizing OpEx/marketing efficiencies while delivering shareholder returns.
• Ex-US segment had all-time high full-year revenue and adjusted EBITDA in 2024, with Q4 also setting records. Closed Q4 with best month ever in December for deposits and total revenue.
• US segment, though smaller, showed growth in Q4 2024 with record revenues in October, November, and December, and spend expected to reduce materially in 2025.
• Balance sheet ended the quarter with unrestricted cash of €356 million and no debt. Announced a special cash dividend of $0.15 per share in December, with total dividend for 2024 at $0.25 per share, and minimum quarterly dividend target increased to $0.04 per share.

For the ex-US segment, 2024 total revenue was an all-time high at €1.66 billion, growing 18% year-over-year, with adjusted EBITDA reaching €391 million, a 53% year-over-year growth and 24% margin. In Q4 2024, ex-US total revenue was €487 million (38% YoY growth) and adjusted EBITDA was €129 million (152% YoY growth, 26% margin). For the US segment, Q4 2024 revenue was €14 million (64% YoY growth), and full-year US spend was €61 million. The ex-US segment contributed significantly more to overall revenue, while the US segment, though smaller, showed growth since transitioning to an iGaming-only strategy.

• For the ex-US business, 2025 total revenue is expected to grow above 10% YoY to at least €1.830 billion and adjusted EBITDA to grow to >€435 million (24% margin).
• For the US segment, 2025 is the first full year of iGaming-only footprint, expecting total revenue around €85 million and investment to reduce to between €30 million and €35 million from 2024's €61 million.
• Combined ex-US and US total revenue expected to be over €1.9 billion with adjusted EBITDA of at least €400 million, a combined margin of 21%.

• Regulatory changes in markets, such as potential tax rate increases in US markets like New Jersey, which could impact the sustainable profitability of operations.
• Need to maintain marketing efficiencies at around 23% of revenue to continue driving growth and returns, as any significant reduction could affect market share and future performance.

Q: In 2024, marketing spend was around 23% of revenue. Should we assume similar level in 2025 guidance?

A: Yes, 23% is budgeted moving forward, with the percentage applied to a higher revenue number and seeing good returns.

Q: Nice increase in quarterly dividend. Any expectation of another special dividend in 2025?

A: Aim to return money to shareholders, with increased quarterly dividend to $0.04, and may consider special dividends if conditions are right.

Q: Share more about key growth markets opportunity, underlying market growth vs new markets and share gains?

A: Growth from existing markets, laser focused on key countries, opening new markets but focusing on sustained profitability, with marketing spend focused on increasing market share in existing markets.

Q: 2025 revenue guidance implies step down from 2024. Any comments on 4Q one-timers and guidance methodology?

A: Ex-US has double-digit growth in 2025 guidance, combining ex-US and US revenue gives over €1.9 billion, with ex-US at over €1.83 billion revenue and >€435 million adjusted EBITDA.

Q: Update on Africa market, deal closed May 2024, contribution to performance?

A: Benefit from being market-leading in African countries with marketing spend, focusing on sustainable profitability and enhanced product features.

Q: Contemplating Alberta legalization, regulatory environment in US?

A: Expecting Alberta legalization in first half of 2026, and for US markets, assess sustainable profitable path considering tax rates, with current green shoots in US markets under current conditions.

Q: New Jersey potential tax rate increase, impact on US strategy?

A: Any proposed tax rate increase would be evaluated for sustainable profitability, but currently continue operations with current tax rates showing green shoots.