Good day, and welcome to the Super Group's Fourth Quarter and Full Year 2024 Earnings Webcast and Conference Call. I would now like to turn the conference over to Brett Milotte from ICR. Please go ahead.

Good morning, everyone, and thank you for joining us today to discuss Super Group's results for the Fourth Quarter and Full Year 2024. During this call, Super Group may make comments of a forward-looking nature that are subject to risks, uncertainties, and other factors discussed further in its SEC filings that could cause its actual results to differ materially from historical results or from the company's forecast. Super Group assumes no responsibility to update forward-looking statements other than required by law. On today's call, Super Group may refer to certain non-GAAP financial measures. These non-GAAP financial measures are in addition to and not a substitute for measures of financial performance prepared in accordance with GAAP. Super Group has provided a reconciliation of these non-GAAP financial measures to the most comparable GAAP measures in the press release issued earlier today and available on the Investor Relations page of Super Group's website. In addition, Super Group will speak to its financial results and metrics in two parts, highlighting Super Group's profitable and cash-generative global business, separately from its investments into the US. This aligns with the annual guidance that Super Group has provided for 2024 and 2025 and is consistent with how Super Group views its business internally and how Super Group will report going forward. Super Group recommends that investors refer to its supplementary presentation posted to the website. On this call, I'm joined by Neal Menashe, Chief Executive Officer. And during the Q&A session, we'll also be joined by Alinda Van Wyk, Chief Financial Officer; and Richard Hasson, President and Chief Commercial Officer. And now, I'd like to turn the call over to Neal.

Thank you, Brett. Good morning, everyone, and welcome to Super Group's Fourth Quarter and Full Year 2024 Earnings Call. 2024 was an outstanding year for Super Group and we are very proud of everything that we have achieved. A year ago, we set out to refine our global footprint, increase our focus on key growth markets, fine-tune our product and technology, and realize operational and marketing efficiencies. I'm proud to say that we have achieved all of this while delivering meaningful shareholder returns. Turning to our numbers, we comfortably beat our ex-US guidance targets for both total revenue and adjusted EBITDA for 2024. Total revenue ex the US was an all-time high for a full year, growing 18% year-over-year to €1.66 billion. Adjusted EBITDA ex the US was also a full year record, growing 53% year-over-year to €391 million, a margin of 24%, well above the 18% that our initial 2024 guidance reflected. For the fourth quarter, total revenue ex the US was another all-time high growing 38% year-over-year to €487 million. Adjusted EBITDA ex the US also set a quarterly record growing 152% year-over-year to €129 million, a phenomenal margin of 26%. We set new customer records during the quarter, including a new daily record of just under 2.2 million customers across all our products, and a new high for an average unique monthly active customers of 5.3 million. And to top it all off, we closed out the quarter with our best month ever. December set new highs for monthly deposits and total revenue. The inherent operating leverage in our business is having a direct impact on our financial results. As our existing markets reach scale, incremental revenue becomes more profitable. Continued investment in revenue growth, coupled with a laser focus on a leaner, more efficient cost base are driving this margin expansion. We expect this trend to continue and while increasing our ex-US long-term margin target to greater than 24%. In the US, while the business is still relatively small and developing, we continue to see green shoots since transitioning to an iGaming-only strategy, including new highs in Q4. The quarter started with record revenue in October, which was then surpassed in both November and December. As a result, Q4 was our best ever US revenue quarter, growing by 64% year-over-year to €14 million. The total investment for the quarter was €11 million, taking our full year spend to €61 million. With our focus now solely on iGaming and the business developing in line with target KPIs, we expect this investment to reduce materially over the coming year, and we remain focused on finding a path to profitability. Moving on to the balance sheet. We finished the quarter with unrestricted cash of €356 million and no debt. In December, we announced a special cash dividend of $0.15 per share, taking our total dividend for the year to $0.25 per share, well above our minimum annual target of $0.10 per share. This resulted in over $125 million being paid to our shareholders. Looking ahead, we are pleased to announce that we secured Board approval to increase our minimum quarterly dividend target to $0.04 per share, up from $0.025. The first payment will be made in March, and the Board will assess on a quarterly basis moving forward. Turning to guidance. We are off to a brilliant start in 2025 and are confident that we will achieve another year of robust growth. For the ex-US business, we expect 2025 total revenue to grow above 10% year-over-year to at least €1.83 billion and adjusted EBITDA to grow to greater than €435 million, a margin of 24%. In the US, this will be our first full year running an iGaming-only footprint. And on that basis, we expect total revenue of around €85 million and our total investment to reduce considerably from 2024 to between €30 million and €35 million. When combining the ex-US and US numbers, this amounts to total revenue of over €1.9 billion and adjusted EBITDA of at least €400 million, a combined margin of 21%, higher than our 2024 margin of 19.5% calculated on the same basis. The progress and changes that we have made to our business over the past 12 months have created a solid foundation for continued sustainable growth supported by a substantial and ongoing investment into marketing. Super Group is well positioned as a major profitable player in the world of online gaming and sports betting and the outlook for our fourth year as an NYSE-listed company is bright. We are excited about the year ahead and look forward to updating you along the way. I'll now turn the call over to the operator to open the call up for questions.

We will now begin the question-and-answer session. Our first question comes from Mike Hickey with The Benchmark Company. Please go ahead.

Hey, Neal, Richard, and Alinda, great quarter, guys, and fantastic year congratulations. Just two questions from us, Neal. Great to see strong guidance for 2025. In 2024, it looked like your marketing spend was around 23% of revenue. Should we assume a similar level of spend here is factored into your 2025 guidance, Neal? And I have a follow-up.

Yes hi, Mike, that's right. 23%, that's what we've budgeted for moving forward. Obviously, it's a bigger number because the 23% is of a higher revenue number, but we're seeing good returns and we continue to track our marketing efficiencies that way. And that's how you get continued growth.

Also nice to see the big increase here in your quarterly dividend. I guess that speaks confidence in your business. I'd love to hear about your decision there. And also should we expect another special dividend you think in 2025, Neal?

Yes. So obviously, we go back and forth on the dividends. We are super happy that we've increased it to $0.04 a quarter. And of course, we always want to return money back to our shareholders. So if we returned $0.25 last year, our aim would be to try and exceed that. But if acquisitions or other circumstances come along, that would obviously have an impact on that; but we still aim to have a good dividend policy, which you can see now with the increased dividend to $0.04 a quarter.

Nice. Great job, guys.

Thank you.

Our next question comes from Jason Tilchen with Canaccord Genuity. Please go ahead.

Good morning and thanks for taking the question. I think to start I'm just wondering if you could share a little bit more about the opportunity you see within some of the key growth markets that you talked a little bit about in the press release. How much of that is coming from underlying market growth versus new markets entering and also from share gains in existing markets?

Okay. So firstly, all the growth is coming from our existing markets. Remember we said we became laser focused on the countries we're in. We picked up countries in Africa, Europe, Canada, New Zealand, etc. We are honing in on those. And of course we are opening up some new markets along the way. But the new markets that we're opening, it's all about how we can get sustained profitability in those markets. We had a big effort in the latter parts of last year closing down markets that we do not see a path to profitability, and I think all of that is showing in our numbers moving forward.

And Jason, just to add there, that is also the focus on what Neal just made reference to is the marketing spend. We stay at a higher percentage so we invest to have that ability to increase the market share to your question in that specific market.

Okay. Great. That's really helpful. And you talked a little bit about the pipeline of additional markets in Africa that you see. Can you just maybe share a little bit more about what the timeline looks like there and what the level of investment that you talked about sort of having some marketing spend that sort of you're ready to sort of deploy it in compelling opportunities? Is that in Africa? And sort of what are the markets that you see as really interesting growth opportunities there?

Yes. So there are opportunities. There are new markets we've opened up along the way. I think you've read in the news we opened up Botswana recently, so there are more coming. It's all about each market and it's the software being efficient in those markets. I think we can't be in all the markets and that's why we've pulled back from some of the markets where we see there is no path to profitability, but we've got a few more coming this year. Again, the existing ones, it's all about the product enhancements and the marketing spend in those existing ones. Especially in some European markets, we are seeing good growth there. The one market that we haven't seen good growth is Germany, but I think the whole industry as a whole hasn't seen good growth in Germany just based on how the regulation has gone there. But the other markets we are seeing good growth. Just to mention, something like Brazil, we applied for a license, and at the last minute we decided not to go for it. We don't see our product ready to be competitive in Brazil where we'd rather fix it for the rest of the world. We're super focused on the markets we are in, and that reflects in the customer numbers you can see in our systems, etc.

Great. Thank you very much.

Our next question comes from Bernie McTernan with Needham & Company. Please go ahead.

Great. Thanks for taking the questions. Maybe just to start I just want to touch on the 2025 revenue guidance. It implies a pretty big step down from what you achieved in 2024. So just maybe any comments in terms of 4Q one-timers that are beneficiaries? And maybe just taking a step back on guidance methodology where some of the outperformance came in 2024 versus the original guidance.

Sorry, Bernie, just to repeat your question, are you making reference to a step down from guidance, because it's actually an increased double-digit increase in guidance for ex US business for both revenue and adjusted EBITDA. So we...

Sorry, I was just saying the year-over-year growth is a step down in 2025 versus 2024 or versus the exit rate in Q4.

So I think we've, for the first time, actually combined our ex US and US revenue, which then gives you the total of over €400 million combined. If you look at ex US, it's an increase to €435 million adjusted EBITDA or above that and €1.83 billion. So, both are double-digit growth top and bottom line.

And I think from my point, it's greater than these numbers. Obviously, this is what we want to achieve and we're off to a good start. But remember, we also got sports results along the way. They were favorable to us in the last quarter, but we are always cognizant of that fact. Our business is still about 75% to 80% casino. These numbers we think we can exceed, but we have to err on the side of caution.

Okay. Understood. Thank you. I also want to touch on Africa. A deal closed last May. So over six months of the asset being under your control. Anything that you could do now that you weren't doing before? Or just generally how is it contributing to performance?

So two things. Remember in Africa, the sportsbook was always ours, the PAM and then they used our feeds, etc. We're seeing a direct benefit of being able to be the market-leading product in the countries in which we operate in Africa. Coupled with our marketing spend, remember in our numbers, which is super important, we're still maintaining a 23% marketing budget. So we've got like that €400 million to €440 million of marketing. I'm not saying we're going to deploy it all, but we only deploy it when we see the opportunities. And the same way goes for enhancing the product, so that you get this super operating leverage. For us, this is key. We could easily drop our marketing budget from 23% down to 20% and bring in another €100 million of profit, but that's not what we want. We want a sustainable long-term business and it's all about the sustainability of our customer base, which we're seeing in the enhanced features that our products offer, especially in Africa, but remember in the rest of the world we've got the UK, Canada, Ontario, New Zealand, etc.

Understood. And just the last one for me. Any update regarding the US now being included in guidance? Any updates in terms of the strategy? And is 2027 still the right way to think about the first profitable year?

Yes, and I'm sorry. Yes, I think so. It's about us getting the revenue up and then of course the operating margin there. Basically now in the US, we are covering all our costs except for the marketing. It's about recovering more of that marketing cost as the revenue increases.

Great. Thank you both.

Our next question comes from Jed Kelly with Oppenheimer. Please go ahead.

Hey, great. Thanks for taking my question. Just as we look at the balance of the year and the guidance, are you contemplating Alberta becoming legal potentially? And then what other regions should we be watching in terms of potential pitfalls, regulations? Can you just talk about the regulatory environment? And I have a couple of follow-ups.

No. So we're only expecting Alberta in the first half of 2026 in our numbers. There's been a slight increase in taxes coming in the UK, and that's factored in some levy there but it's a small amount. In our numbers for the second half of 2024, there was some additional tax in New Zealand. So that's included in our 2025 numbers. But we're hoping New Zealand regulates in 2026 and we are far down the line there with all the regulators there.

And then when we look at your cash balance, obviously, you have plenty of capacity to do a dividend. How should we think about potential acquisitions and what you would be looking to acquire? Would you be targeting regions in Africa, Australia, or New Zealand where some of the other competitors might not be? Or is it more tuck-in acquisitions? And then what would your Q4 sportsbook results have been if you had just normalized hold? Because I think you had favorable sports results last quarter, correct?

Hey Jed, Richard here. I'll answer the first part of your question. In terms of opportunities, we're constantly assessing a number of them across the globe, in complementary regions or existing regions. We're probably looking more in the form of tuck-in M&A opportunities, across both sports betting and gaming across the regulated landscape.

I'll just touch on the margin. So the sports margin actually was a normal margin in Q4, but then you had that plus casino both coming together. It wasn't an extraordinary margin in those months. It's just that in the rest of the quarters before, you had some outliers winning, so they were less. What I think Q4 shows, when the two are coming together, sports and casino, then you see the profits we delivered. I did say on the call that December was our highest ever month of deposits of customers in. For me, this is all about returning customers into our ecosystem. We had an average of 5.3 million monthly unique customers, but the significant number is the 2.2 million in one day. That shows how far we've come from 1.8 million before, and that's about getting customers depositing and playing in our sportsbooks and casinos.

Yes. Okay. Circling back to the US, you guided today. I mean the Governor of New Jersey has his budget address today at 3:00 p.m. Some are speculating he could raise gaming taxes upwards to like 25%. How would you view that? How would that change your view of the US if New Jersey goes to a higher tax rate? Would that potentially make you want to pull out of those markets, just given the higher taxes? Thanks.

I think, Jed, if there is any proposed increase in the tax rate, it would just form part of our macro question on those markets or any others. Is there a sustainable, profitable path for us in those markets? If a higher tax rate meant there wasn't, then we would take a closer look at that point. But for now, we continue doing what we're doing. We are seeing good green shoots in those markets based on current tax rates and the current market conditions. That means, for now, we continue doing what we're doing.

Most importantly, what we've done in the last year, right, is implement cost efficiencies. We're down like 1,000 people not because we're letting people go, but it's to achieve cost efficiencies. It's all about systems we are putting in that can manage more. As we increase volumes, we don’t have to increase staff count, etc. All of that helps weather some of these tax increases.

Thank you. Great year and great job. Thanks.

Thank you.

Thank you.

This concludes our question-and-answer session. The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.