Paf achieved a record high income of €177.1 million (£150.8 million/$191.4 million) in 2023, but the Scandinavian company also cautioned that increased gambling levies could affect its future earnings.

Paf experienced another financially successful year in 2023, with earnings rising by 6.9% year-over-year. The company’s net profit also expanded by 23.0% to €55.1 million, another new yearly record.

However, although CEO Christian Fahlstedt welcomed the news and commended Paf’s performance, he also issued a warning about the future profit outlook. Fahlstedt specifically highlighted that escalating gambling taxes across various markets could impact net profit levels in the years to come.

In Finland, a temporary reduction in lottery tax has ended, and the rate has now increased from 5% to 12%. Meanwhile, gambling taxes in Sweden have risen from 18% to 22%, Estonia from 5% to 6%, and Latvia from 10% to 12%.

“We are pleased and proud of the past year,” Fahlstedt stated. “We have acquired a larger customer base, with a 27% increase in active customers, which explains part of it.

“However, we are also clearly aware that the temporarily lower gambling tax in Finland aided the results. The trend of increasing gambling taxes will continue.”

Fahlstedt also highlighted the influence of the calls for enhanced responsible gaming measures, which he characterized as a “critical need.” Interestingly, Paf decided this month to further reduce spending limits for players between the ages of 20 and 24 to €8,000. This move follows Paf’s comprehensive overhaul of its compulsory online spending limits in April 2023, decreasing them from €20,000 to €17,500.

Fahlstedt stated, “These adjustments will result in a reduction in profitability, and many operators will encounter greater challenges.” “However, Paf is well-prepared for the future.”

Paf’s online business expansion drives revenue growth
Examining the revenue performance of 2023, it is evident where Paf’s growth originates. Its online business revenue increased by 8.2% to €153.8 million, with Paf emphasizing robust growth in Sweden, Spain, and Latvia.

The latter benefited from the acquisition of Latvian-facing William Hill Latvia SIA and SIA Mr Green in June 2023. Paf indicated that these transactions generated an additional €5.1 million in online revenue.

Paf also reported a 27.3% increase in the number of registered online customers, reaching a record 615,557. The operator anticipates this total to continue expanding in 2024, supported by ongoing marketing initiatives.

Regarding Paf’s other businesses, land-based and ship-based operations experienced a revenue decline of 0.9% to €23.3 million. This is despite a 4.0% increase in the total number of ship passengers in 2023.

Here, Paf has established new agreements with Tallink Group and Eckerö Linjen, and welcomed Finnline’s new vessel M/S Finnsirius.

Paf and Pikseli have joined forces to create the first land-based gaming area in Helsinki. The concept behind this gaming space combines entertainment games with leisure activities.

Paf has also recognized the growing trend of contactless payments, and all amusement games and nearly half of the coin-operated machines now provide cashless payment options. Paf states this move is designed to meet customer demands for more convenient payment methods.

“With these initiatives and innovations, we expect continued growth and ongoing improvement of our services and goods,” stated Paf.

Net profits have consistently risen, driven by revenue growth.
In terms of expenses, material and service costs increased slightly by 7.9% to €42.6 million. Staff costs remained stable at €24.2 million, while depreciation and amortization only increased slightly to €10.6 million.

Other operational expenses decreased by 2.0% to €52.9 million, while Paf’s net financial income rose slightly by €723,605.

As a result, Paf’s pre-tax profit reached €60 million, representing a year-on-year increase of 27.9%. After paying €5.2 million in taxes and accounting for the impact of deferred taxes of €305,468, net profit for 2023 increased by 23.0% to €55.1 million.

Paf also noted that higher revenue and profits allowed it to allocate €31.4 million in 2023. These funds are used for social公益事业, including supporting non-profit organizations dedicated to promoting social development in areas such as social activities, culture, youth work, sports, and environmental activities.

“It’s definitely reassuring that Paf’s strong performance has allowed us to allocate a total of €31 million.”

Four meters,” Chairman Jan-Mikael von Schantz announced. “The staff has performed exceptionally well this past year, and the board conveys its appreciation to all Paf employees who made this achievement possible.”

Subscribe to the iGaming newsletter.