Kindred Q3 2020 Handout.Pdf

Henrik Tjärnström CEO

Q3 2020 6 November 2020

• General update ‒ Strong rebound of sports ‒ Locally regulated markets driving growth ‒ Key stages in local regulation ‒ The Netherlands & U.S update Outline ‒ Cost control • Financial result • Business overview • Summary

• We continue to see strong 16 demand for sports and entertainment from our customers 12 Q1 Q2 Q3 • Q3 sportsbook turnover grew by 21% year-on-year 8 • France returned back to pre-COVID levels 4 Total SB stakes GBP 1,143m Total SB stakes GBP 780m Total SB stakes GBP 1,476m Y-o-Y growth -14.7% Y-o-Y growth -37.9% Y-o-Y growth +21.2% - Jan-20Jan Feb-20Feb Mar-20Mar Apr-20Apr May-20May Jun-20Jun Jul-20Jul Aug-20Aug Sep-20Sep 2020

Strong activity has continued in Casino & Games, Poker and other products

• Poker, Casino & Gaming and other GWR development for Casino & Games, Poker and other products compensated for the GBPm temporary loss in the Sportsbook during the spring 180 160 • During Q3 Kindred has continued to 140 focus on high quality offering of casino and other games, including 120 poker and the activity has remained 100 strong despite the return of sports 80 • Migration from offline to online 60 accelerated due to COVID-19 40 20 0 Q1Q1 2019 Q2Q2 2019 Q3Q3 2019 Q4Q4 2019 Q1Q1 2020 Q2Q2 2020 Q3Q3 2020 2019 2020

Locally regulated markets Y-o-Y growth Stable long-term profit margins despite drive the GWR growth (GBPm) short-term regulatory pressure +10% 1,001.7 70% 912.8 % of locally regulated GWR 60% 398 Other +5% 50% 379 markets 40%

30% Locally 604 20% 534 regulated +13% markets 10% Underlying EBITDA-margin (LTM)

0% FY 2019 LTM Sep 2020 2013 2014 2015 2016 2017 2018 2019* 2020

* 2019 figures have been impacted by the adoption of IFRS 16 “Leases” and are therefore not directly comparable to prior years. © Kindred Group plc 2020 5

Increasing share of sustainable locally regulated profits Track-record of absorbing regulatory headwinds and increased betting duties

Betting duties GBP 159m GBP 204m GBP 211m

• Since 2018, the annual Locally regulated betting duties have % of GWR 43% 59% 60% increased by over GBP 50m at the same time as Underlying EBITDA the LTM EBITDA is down GBP m by only GBP 4m (vs. FY18) • After the initial margin (–) (–) pressure, the revenues in (–) (+) Sweden are growing 204 (–) (+) steadily with improving 200 sustainable profit contribution during 2020 130

Underlying Sweden US impact Other Underlying Sweden US impact Other Underlying EBITDA impact EBITDA impact EBITDA FY18 FY19 LTM

Introduction phase Market positioning Sustainable growth phase 0-6 months 6-18 months 18+ months

Market characteristics

Regulatory Fierce Low customer Regulatory Industry Increased Higher Increased Improved instability competition loyalty pressure consolidation barriers level of customer public to entry channelisation loyalty perception Financial impact

Slight increase Higher revenue Stable revenue in revenue growth growth

Pressure More stable Higher on margins margins margins

This is a simplified illustration of the general patterns post a local market regulation. Naturally, deviations can occur due to market differences . © Kindred Group plc 2020 7

The Netherlands

• The Dutch regulator (KSA) to disclose further licence conditions in Q4 2020, some details are still unclear • Kindred participating in consultations about AML, responsible gambling (RG) and regulated market vision • Scheduled to enter into force 1 March 2021 (= kick off license applications). Possible delay not excluded • Dedicated teams working on license application & tech preparations • Learning from over 12 years of re-regulation put to work • Strong commitment towards the Dutch society (notably RG and sports) • We will be ready!

Ambition to be live in at least 5 states by end Conditional access to states 11 of 2021 providing sustainable legislation

• After launching in Indiana on 30 July 2020, Kindred is now live in three states • In September, Kindred entered into an New Jersey Pennsylvania Indiana & Iowa agreement with Penn National Gaming providing market access in Illinois and Ohio to operate both online sports betting and online gaming (pending applicable laws to be passed) • On 18 October 2020, Kindred applied for OTHER Conditional access a (sports) betting license in Virginia + STATES to over1/3 Illinois & Ohio 5 of US population • Launch in Illinois is expected in early 2021 followed by Iowa later in the year

The US continues to develop

in accordance with plan US operations Q3 2020 GBPm GWR 7.3 ‒ The GWR amounted to GBP 7.3m in 2020 Q3, an increase CoS -6.6 of approx. 22% from Q2 2020. The growth was reduced by a relatively low sportsbook margin and high bonus uptake Marketing -2.6 Admin expenses -1.1

‒ The total number of active customers in the US, increased§ EBITDA -3.0 by 45% in 2020 Q3 vs. 2020 Q2 US GWR development by quarter ‒ We continue to gain market share in existing states with over GBPm 5% share being achieved in Pennsylvania in Q3 2020 Q3 2020 7.3 ‒ The average daily GWR for the period 1 October - 3 November Q2 2020 6.0 2020 decreased by 8% compared to the full third quarter Q1 2020 2.6 Q4 2019 1.7 Q3 2019 Q2 2019

28.4% Q1-Q3 2019 23.6% 21.0% Q1-Q3 2020 16.7% 16.7% 16.9% Q3 10.8% 2020 10.5% 9.4% 8.1% 6.3% 5.3% 4.8% 2.5% 1.9%

Cost of CostSales (excl.of Sales Betting duties MarketingMarketing costs costs Employee Employee costs costs OtherOther above aboveEBITDA opex Capex (excl.Capex US license fees) (excl. Betting& Affiliates) duties & Affiliates) EBITDA opex (excl. US license fees)

Cost saving Renegotiate Review of brand FTE’s reduced Consultants Headcount initiatives contracts with portfolio across from 1,697 at the reduced from reduction and suppliers markets end of Q1 to 1,628 152 at the end of conversion of Switch to cheaper Rebalance at end of Q3 Q1 to 114 at the consultants suppliers when marketing levels Redundancies end of Q3 to employees possible across markets and strict control Reduced Opex Strict cost control Adjusting marketing of attrition costs related to level and mix to travel, telecom and optimise ROI other opex

Financial results

Locally Gross regulated Underlying Free Active winnings Net debt share of EBITDA cash flow customers revenue GWR

GBP 280.7m GBP 170.2m GBP 74.6m GBP 59.7m 1,650,153 GBP 2.2m (+24%) (61% of GWR) (+100%) (+34.8m) (+19%)

Gross winnings revenue

GBPm 907.6 912.8

751.4 250.1 236.2 765.5 657.5 676.6 238.0 280.7 544.1 513.4 230.7 226.0 152.8 391.3 354.1 193.6 235.1 Q4 312.0 226.2 268.0 111.4 142.3 219.0 226.7 234.078.0 242.7 Q3 166.6 80.4 86.1 126.6 Q2 77.1 80.5 207.8 224.4 249.7 153.2 76.5 76.1 122.4 Q1 2012 2013 2014 2015 2016 2017 2018 2019 2020

GWR as reported Organic GWR in in GBP constant currency

Nordics -1% 1%

Western Europe 28% 27%

CES 27% 31%

Other 254% 263%

EBITDA

GBPm 202.8 178.5 58.5 158.3 144.3 73.8 128.1 120.7 106.5 55.5 74.2 98.130.0 38.9 77.0 81.8 Q4 46.6 37.1 26.2 33.1 41.5 50.8 51.6 Q3 30.5 30.4 17.4 21.1 Q2 19.0 47.3 27.6 29.4 30.6 32.5 14.4 Q1 2015 2016 2017 2018 2019* 2020

*Since 2019 figures have been impacted by the adoption of IFRS 16 “Leases” and are therefore not directly comparable to comparative years.

Avg rateQ3 2019 Q3 2020 Movement AUD1.798 1.806 -0.4% DKK8.275 8.227 0.6% Weighted average impact of FX EUR1.109 1.105 0.4% 5.4 rates on GWR was a negative NOK10.917 11.791 -8.0% impact of less than 1% SEK11.821 11.452 3.1% USD1.233 1.292 -4.8% GBPm Gross winnings revenue -1.1 Cost of sales / Opex 0.4 FX loss on operating items -1.2 EBITDA FX impact Q3 2020 -1.9 FX gain on borrowings 0.3 Other items below EBITDA -0.1 Profit before tax impact Q3 2020 -1.7 Includes realised FX losses of 0.5m

Business overview

© Kindred Group plc 2020 18 Sustainable growth Active customers and Group ARPU ATH Thousands/GBP 1,600 1,400 1,200 1,000 800 600 400 ARPU 200 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 20132013 20142014 20152015 20162016 20172017 20182018 20192019 2020

Sports betting gross margin Combined

Before free bets After free bets 12%

10%

0% Q1 Q2 Q3 Q4 YR Q1 Q2 Q3 Q4 YR Q1 Q2 Q3 Q4 YR Q1Q2 Q3 2017 2018 2019 2020

By product, % By geography, %

Other 222333333 Other 222223366

Casino & 48 46 48 47 47 45 Western 48 52 56 Games 59 62 60 60 61 61 64 Europe 60 62

2 Poker 2 3 222 3 2 22 21 CES 8 Live betting 26 23 24 24 21 7 8 4 22 8 9 99 9 9 12 Pre-game Nordics 34 32 28 24 24 24 26 28 28 30 29 27 27 25 betting 22 17 21 23

Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 201820192020 2018 2019 2020

Sustainability

Project together with Zafty Intelligence to develop a self-control app which uses AI technology Unibet and ice hockey star Henrik Lundqvist promoted fair sports and inclusion through the 30/30 Foundation Almost 700 participants gathered at SGC to discuss how technology can enhance a safer gambling experience Upgraded PS-EDS Algorithm improved using AI Based on DSM-5

Set emissions targets Paris Agreement and the IPCC two-degree target

22 • Temporary impact from COVID-19 but we remain resilient • Sports returned faster than expected • Strong progress in the U.S Summary • Continued focus on cost control • Strong financial position • Operators, authorities and regulators need to cooperate closely for a sustainable gambling market • Two years of sport coming!

Investor Relations 10 February 2021 Q4 will be published at 7.30 CET Inga Lundberg 28 April 2021 +44 788 799 6116 Q1 will be published at 7.30 CET [email protected] 28 July 2021 Q2 will be published at 7.30 CET

27 October 2021 Q3 will be published at 7.30 CET