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AVSNITTSRUBRIK 2018 ANNUAL REPORT MORE INFORMATION ABOUT BETSSON IS AVAILABLE AT WWW.BETSSONAB.COM BETSSON ANNUAL REPORT 2018 1 BETSSON ÅRSREDOVISNING 2018 2 CONTENT About Betsson ....................................................................................................................................................................... 4 2018 in brief .............................................................................................................................................................................. 5 CEO Message ......................................................................................................................................................................... 6 Betsson Group operations ..............................................................................................................................................8 Focus on sustainability ................................................................................................................................................. 10 Management report ...................................................................................................................................................... 18 Corporate Governance Report .............................................................................................................................. 24 Board of Directors and Auditor ............................................................................................................................. 30 Senior Executives ............................................................................................................................................................. 32 The Share and Shareholders ................................................................................................................................... 34 Five-year summary ......................................................................................................................................................... 36 Consolidated Income Statements ..................................................................................................................... 38 Consolidated Statements of Comprehensive Income ........................................................................ 39 Consolidated Balance Sheets ................................................................................................................................ 40 Consolidated Cash Flow Statements ............................................................................................................... 41 Changes in Equity for the Group ......................................................................................................................... 42 Parent Company Income Statements ............................................................................................................ 43 Parent Company Balance Sheets ....................................................................................................................... 44 Parent Company Cash Flow Statements ..................................................................................................... 46 Changes in Equity for the Parent Company .............................................................................................. 47 Notes .......................................................................................................................................................................................... 48 Proposed Appropriations of Profits ................................................................................................................... 74 Audit report .......................................................................................................................................................................... 75 Auditor’s report on the statutory sustainability report ...................................................................... 78 ANNUAL GENERAL MEETING Shareholders whose shares are managed through nominee The Betsson AB (publ) Annual General Meeting will be must, in order to be entitled to participate in the General held on Tuesday 7 May 2019 at 1:00 pm at “Bond” GT30, Meeting, temporarily register their shares in their own Grev Turegatan 30, Stockholm. names with Euroclear Sweden AB. Shareholders wishing to re-register must notify their nominee well in advance Shareholders wishing to attend the Annual General of Tuesday 30 April 2019. Meeting must: • be registered in the shareholder register maintained OTHER INFORMATION by Euroclear Sweden AB by no later than Tuesday Betsson intends to publish financial information 30 April 2019. relating to the 2019 financial year as follows: • have notified the Company of their intention to participate in the Annual General Meeting by no Interim report Q1 later than 2 May 2019. January–March 2019 7 May 2019 Interim report Q2 Notification of attendance at the Annual General Meeting January–June 2019 19 July 2019 shall be made via the registration form at www.betssonab. com, or by phone on +46 8 506 403 00. Notification to Interim report Q3 attend shall include the attendee’s name, personal identity January–September 2019 24 October 2019 number/corporate identity number, address, telephone number and shareholding. If participation is by proxy, the Year-end report Q4 notification of attendance must be accompanied by the January–December 2019 13 February 2020 power of attorney, incorporation certificate or other appropriate documentation, sent to the Company If you want to read or subscribe to Betsson reports ([email protected]). A power of attorney and press releases, please visit www.betssonab.com. form for shareholders wishing to attend by proxy will be available on the Company’s website, www.betssonab. com. This Annual report is an English translation of the Swedish original. In the event of any discrepancies, the Swedish version shall govern. ABOUT BETSSON Betsson AB (publ) is a holding company that invests in European Sports Security Association (ESSA), G4 (Global and administers fast-growing companies within online Gambling Guidance Group), Remote Gaming Association gaming. The Company is one of the largest in Europe in (RGA) as well as the Swedish Trade Association for Online online gaming and has the ambition to outgrow the Gambling (BOS) and The Swedish Gambling Association market, organically and through acquisitions. This is to (SPER). be done in a profitable and sustainable manner, primarily The Betsson Group has approximately 1,500 employees in locally regulated markets. The Group has gaming of more than 55 different nationalities in offices in ten licences in twelve jurisdictions. Betsson AB has been countries. listed on Nasdaq Stockholm since 2000 and on Large Cap (BETS) since 2015. THE PARENT COMPANY BETSSON AB The Company was established in 1963 and Betsson has IS RESPONSIBLE FOR: since then been at the heart of the entertainment sector, • Setting the strategic direction and objectives reaching its position by focusing on customer experience. for the operational subsidiaries By best-in-class technology, the Company’s objective is to • Corporate structure and governance exceed customers’ expectations. The Group’s operational • Risk management and compliance subsidiaries provide casino, sportsbook and other games (including monitoring the operational subsidiaries) via gaming licences in twelve countries in Europe and • Acquisitions and divestments Central Asia. Gaming options are provided via a number of • Financial reporting. brands. The brands are operated on a proprietary platform, which is core in the offer and the customer experience. The Parent Company Betsson AB determines the vision, Being responsible in relation to customers, suppliers, mission and ambition of business activities in the opera- authorities, investors and other stakeholders is a corner- tional subsidiaries, which are expressed in English, the stone of Betsson’s business. Betsson is a member of the language of the Group. European Gaming and Betting Association (EGBA), Vision Mission Ambition Deliver the best customer experience Be a longterm, leading Outgrow the market in the gaming industry online gaming company BETSSON ANNUAL REPORT 2018 4 2018 IN BRIEF BETSSON ON TRACK In 2018 Betsson has worked systematicaqlly to get back on track after a period of decrea- sing profitability. The “Back on track” plan was implemented via a series of measures throughout the entire organisation. Clear ownership and continuous monitoring have enabled the Group to achieve results in areas such as product quality and functionality, increased market share, improved leadership and reinforced profitability. At the same time, the Company has focused on taking responsibility for ensuring the customer a good and safe experience enjoying Betsson’s entertainment offering. GROWTH WITH INCREASED PROFITABILITY In 2018, Betsson saw its earnings rise by 15 percent to SEK 5,420 million through growth in all regions. At the same time, an efficient organisation has managed to lower costs and increased profitability. Operating income for the full year amounted to SEK 1,194 million, an increase of 35 percent compared with the previous year. LICENCES FOR THE SWEDISH MARKET At the end of the year, Betsson received five-year licences for the Swedish market. Betsson has strived for this since many years and is now delighted to welcome the Swedish regulation that can enable

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