SGHC

Thank you for standing by, and welcome to the Super Group first quarter 2026 earnings webcast and conference call. Thank you. I'd now like to turn the call over to Nkem Ojougboh, Head of Investor Relations. You may begin.

Morning, everyone, thank you for joining us today to discuss Super Group's results for the first quarter 2026. During this call, Super Group may make comments of a forward-looking nature that are subject to risk, uncertainties and other factors discussed further in its SEC filings that could cause the actual results to differ materially from historical results or from our forecast. We assume no responsibility to update forward-looking statements other than as required by law. On today's call, we may refer to certain non-GAAP financial measures. These non-GAAP financial measures are an addition to, and not a substitute for, measures of financial performance prepared in accordance with GAAP. We have provided a reconciliation of the non-GAAP financial measures to the most comparable GAAP figures in the press release issued yesterday and available on the Investor Relations page on our website.

We recommend that investors refer to the supplementary presentation posted to our website. Today, I'm joined by Neal Menashe, Chief Executive Officer, and Alinda van Wyk, Chief Financial Officer. After our prepared remarks, we will open the call up for questions. Now I'd like to turn the call over to Neal.

Thank you, Nkem, good morning, everyone. The first quarter of 2026 marked a record-breaking start for Super Group. We delivered all-time high quarterly revenue and unprecedented Monthly Active Customers. Deposits and wagering also reached peak levels, extending our Q4 momentum. These results reflect the strength of our strategy, our brand, and our people. As our business evolves, so does our reporting. We are introducing a new reporting structure consisting of two segments: Africa and International. Africa includes all revenue generated across the African continent, while International includes all revenue generated outside of Africa. This new approach highlights the distinct operating models across our core regions, providing shareholders with deeper insight into each unit's drivers and growth potential. The executives responsible for these segments remain unchanged. Africa delivered an excellent Q1.

Revenue for the quarter grew 33% year-over-year, with adjusted EBITDA up 21% to $98 million. Sports and casino wagers were up 33% and 36% respectively year-over-year. Botswana continues to perform well. I recently spent time on the ground with our team in Nigeria, and the actions we are taking there will strengthen our growth profile as we ramp up execution. The phased rollout of our ZAR Super Coin consumer wallet began in mid-April with a soft beta launch for our Betway South Africa customers. Our goal is simple: expand utility and gradually increase customer engagement across our ecosystem. We will reach a key milestone late in the quarter with additional listings on OVEX and VALR, two of the largest exchanges in South Africa.

These listings significantly enhance liquidity and accessibility and provide a solid foundation for broader adoption as we optimize engagement and unit economics. For the international segment, revenue was up 9%, with adjusted EBITDA growing 26% to $73 million. European revenue growth of 18% year-over-year was strongly driven by a 29% increase in the U.K., where we are capturing market share thanks to record customer acquisition off the back of continued product improvement and a successful Cheltenham Festival. We remain encouraged by Ireland's growth, up 13%, with local regulation expected in the second half of this year. In North America, Canada ex Ontario delivered 16% revenue growth, supported by retention and product enhancements. Despite an increasingly competitive environment, Ontario achieved a post-regulation record for new customers.

Alberta, up 22% year-over-year, remains on track for local regulation in July with a saved and registered method brand rollout. North America, excluding the U.S., grew 15%. Rest of World saw revenue growth of 8%, with New Zealand growing 6% year-over-year, which is particularly encouraging after last quarter's 5% decline. We remain disciplined while we await the anticipated local regulations framework. Our sports business continues to enjoy strong margins. We are fortifying our sports trading and risk management capabilities ahead of the World Cup. This quarter, we implemented targeted changes to materially improve margin resilience within our promotional mechanics, pricing, and payout structures. These measures proved their value in February, which was a particularly challenging month for sports due to customer-friendly outcomes. Our casino business remains the super reliable, steady, and constant engine of Super Group.

We don't take this for granted. We continue to innovate, extend, and improve in numerous and meaningful ways. We have made it easier for our customers to discover content. We are personalizing their experiences, and we are stepping up gamification and engagement. The result is targeted product and incentive management that delivers strong retention and responsible, consistent, and profitable customer behavior. Net effect, a business where 80% of our revenue is driven by predictable, high quality, and super persistent annuity revenue streams that offer shareholders unwavering reliability and confidence. With that, I'll turn it over to Alinda van Wyk.

Thank you, Neal Menashe. Quarter 1 2026 marked an outstanding start to the year for Super Group, and I couldn't be more pleased to share these results. We have delivered a record total revenue of $612 million, up 18% year-over-year, while adjusted EBITDA grew 36% to $152 million. Our margin expanded to 25%, compared with 22% in the prior year period. Driven by strong acquisition and retention strategies, average monthly active customers reach a record 6.4 million, up 18% year-over-year, with March setting a new monthly high of 6.5 million customers. Total wagering increased 23% for sports and 20% for casino compared to last year. Disciplined cost management, controlled marketing spend, and strong operating leverage are clearly reflected in our results.

With continued focus on AI-driven efficiencies and high return markets, we are well-positioned to pursue sustainable long-term growth. Our balance sheet remains really strong, supported by high-quality earnings and measured capital allocation. We ended the quarter with $422 million in cash. This represents a 20% increase year-over-year, despite returning $152 million to shareholders, including the special dividend paid in February. Our free cash flow conversion of 75% remains strong, reinforcing the confidence that we showed when we recently increased our minimum quarterly dividend target to $0.05 per share. Building on the strong momentum of Q1, we are entering the rest of the year with confidence. Q2 is tracking positively with growth opportunities ahead, bolstered by an action-packed World Cup calendar. Our focus on marketing and operational efficiencies remains unchanged.

As a result, we are reaffirming our full year 2026 guidance, with total revenue expected to reach at least $2.55 billion and adjusted EBITDA to be more than $680 million. I will now hand back to Neal for closing remarks.

Thank you, Alinda. This quarter underscores the effectiveness of Super Group's strategy and discipline. We are building momentum across regions, bolstering margin resilience, and enhancing our product and customer experience. With a strong start to the year, strengthening our casino business, an attractive global sporting calendar ahead, and a strengthened leadership team focused on execution and efficiencies, Super Group is well-positioned for the remainder of 2026 and beyond. Operator, please open the call up for questions.

Thank you. We will now begin the question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. If you would like to withdraw your question, simply press star 1 again. Your first question comes from a line of Michael Hickey from StoneX. Your line is open.

Hey, Neal Menashe, Alinda van Wyk, congratulations, guys, on a great 1Q. Two questions from us. Neal Menashe, just on Alinda van Wyk. On your 1Q performance here, obviously, a strong beat versus expectations, and the MACs growth was exceptional, 18%. I think you hit a record of 6.5 million in March. I guess how are you thinking about the decision here, Alinda van Wyk, Neal Menashe, to reaffirm your guidance versus raising for the full year at this stage?

Hi, Mike. Thanks. Our guidance, as you know, was for revenue greater than $2.55 billion, and very importantly, EBITDA greater than $680 million. We were confident about those numbers when we told them to you in February. Now, after Q1, we remain confident, but this isn't the first time that we've outperformed, like in Q1. We've never increased guidance at this stage of the year. It's just not something we do so early on in the year. We obviously are focused, as you know, on executing and delivering growth, and we're not finessing projections and guidance. It's really this simple.

Just to add to that, I think it's important also to note we're just not in that beat and raise treadmill game, as we all know. We are tracking ahead of our expectations, and we're very encouraged by what we're seeing in the momentum, but we're only 25% into the year.

Nice. Thanks, guys. Next question from us, just on the World Cup. You gave some great data here in your deck. It looks like 80%, 88+% of your revenue generated from World Cup participating markets and 73% of your GGR from football. Obviously it looks like World Cup year is shaping up to be a significant catalyst for you guys, Q2, Q3. How should we think about the potential uplift to both player activity and revenue during the tournament period? Then the follow-up, you know, how should we think about the timing and scale of the cross-sell of these incremental players to casino, which of course would make this World Cup catalyst durable? Thanks, guys.

All right. I mean, listen, I love this data point that basically, and I thought a lot about this, that 40% of the countries we operate in are participating in the World Cup, and that represents almost 88% of our 2025 revenue. What we will get is we're Super Group confident about the engagement of our customers in these markets. We've obviously got strong product stability and enhancements we've done ahead of the tournament, and we're focusing on the scale and the customer experience. A bit different this World Cup to the 2022 World Cup. The 2022 World Cup was played as it was in the winter months. It was played in November and December, and had 64 matches.

Because there are more teams in this year, it's now, you know, June and July, it's 104 matches. Literally 63% more matches with more engagement. For us, it's all about it's giving us the content for our customers. The first half of the competition, because there are 48 teams, there might be, you know, in our business it's all, it's all about the favorites drawing or losing. Hopefully let's see how the first half goes. Obviously as they get into the knockout stages, which will be at beginning of July, we will see what happens there. Again, it's about engagement in the sports and then the cross-sell into our casinos. Yeah. The cross-sell normally is like 60%-70% into casino.

Nice. Awesome. Thanks guys. Good luck.

Your next question comes from a line of Ryan Sigdahl from Craig-Hallum. Your line is open.

Hey, good day, Neal, Ink, Linda. wanna stick just one follow-up on the guidance. Are you willing to comment on trends you've seen in April and May? I get the reason to reiterate this early in the year, but curious if you've seen any deceleration in the business or any trends or anything to really give you concern.

All right. This quarter started off great. Obviously, you know, in February, remember quarter one had a big loss in February on 1 day when all the favorites basically hit 1 and our customers won. We haven't seen any deceleration. Remember, our guidance is greater than $680 million. We are confident about that. Remember our business is 80% casino, stable, consistent, and we are annuity income on top of that every single day.

Second question, just the U.K. tax effect went in effect recently here. What are you seeing in the market from your competitors? What have you done from a marketing promotion, et cetera, standpoint? Really nice quarter results and momentum it seems like in that business despite that. Just curious for kind of an industry and company update there.

Thanks for the question. We called out around 6% pre-mitigation of 2025 EBITDA. The hit is around a $30 million hit. However, we have starting to pull multiple levers in order to mitigate that. As we said, we've obviously don't include even with the April numbers already in effect, we haven't seen that massive impact because of operating leverage and the way we manage our marketing. We feel in a confident position to see this through Q2.

Also we did call out that I would say it only kicked in on 1 April, so only like 2 weeks, 5 weeks in, that the marketing rates will start coming down when everyone starts doing their numbers. You know, that they have to get used to this new world of taxes and obviously we have to be efficient. That's part of our 2 segments, being International and Africa and bringing International together has effectively given us this operating leverage.

Very good. Thanks, guys. Good luck.

Thank you.

Your next question comes from a line of Bernie McTernan from Needham & Company. Your line is open.

Great. Good morning. Thanks. Thanks for taking the questions. First just wanted to ask about the new breakdown in terms of EBITDA. Greatly appreciate being able to see, you know, Africa versus international. Elinda, can you just talk about the margin opportunity in Africa? You know, any maybe any thoughts on incremental margins just as the region continues to grow, how we should expect margins to scale with it? Then I have a follow-up. Thank you.

Thanks for the question, Bernie. It's a I'm glad to be able to share that transparency now to the market to see what it brings us to Super Group, the difference between Africa and international. It's not so heavily weighted. You know, the expectation probably was it was very heavily weighted towards Africa. Saying that gives us the ability to have really strong possibility to still have that margin expansion. We always do it in two kind of strategies. The one is our return on investment, how we make sure we the marketing that we spend in that jurisdiction is very localized, it's spot for that customers, and we see strong returns on that. Then secondly, our product mix is getting that product really fit for purpose for that local market, getting the pricings right.

That really helps us with the expansion of not just in South Africa, but the rest of Africa, the bottom line.

Yes, we've got huge cross-pollination between the international side of the business and the African side. I think we've really, in the last six months, have scaled that up from the call centers, same software to the risk and fraud to all of that. We really are seeing super efficient costs coming through there. Also in Africa, we've been pushing on different sports, e-soccer, cricket, tennis, et cetera, so it's all coming together. We should also mention our trading. We are really getting stuck into the trading of all the various sports.

Understood. Thank you both. In the slide deck, it references Nigeria ramp up underway to strengthen growth profile. What would success look like this year in Nigeria for you guys? Thank you.

I think that the Nigeria is an interesting one. We've been on the ground there. Super interesting. I think what we have seen in African continent, and maybe led by Nigeria, is that the country as a whole is doing much better. The free flow of the currency is improving. We have to, listen, double, triple our business out of there, at least try. I think as you know, it's the largest population in Africa. It's a growing town, and we're getting our product right. Again, we can build or buy across the ways, and we can do both. It's really top of our mind.

Thank you.

Your next question comes from a line of Jed Kelly from Oppenheimer. Your line is open.

Hey, great. Thanks for taking my questions and another great quarter. Just on the margin cadence between the two segments, how should we be thinking about that, particularly in the international margins? I know you've got the U.K. taxes, and then you're launching Canada in July. Can you just give us a sense how we should be thinking about that? With Africa, should we expect revenue to grow faster than EBITDA over the medium term? Thanks.

Hi, Jed. Great questions. First of all, on the international side, the how we look at international is the continued customer momentum. Our assumptions in the guide is definitely on organic growth assumption. There's no aggressive persistency assumptions made in there. We're also making sure that we have that marketing discipline of around 22%. If we caveat to Africa, that 22% of marketing as a guide towards the spend of revenue is much lower in Africa because of the jurisdiction and the localization of marketing. That gives that ability for the EBITDA just to the EBITDA margin to grow as strong as the revenue market targets that we set for Africa.

The interesting thing is here is that it's a very equal business. You know, even though you have probably most of the scale of the growth of the customer base out of Africa, the revenue and the EBITDA margin growth is very similar.

I could just add, and this is probably a point on Alberta, it's very different Alberta regulation to Ontario. Ontario was what we call the Big Bang approach. You had to move all your existing customers over onto the new software on day 1 before you could even market the new software. In Alberta, you can market to the new software first and have a period of 3 months or so to be able to move your existing customers over. That, for us, is a massive difference. We tried for that in Ontario, it didn't happen at the time. Now it can happen in Alberta.

Thanks. Just as a quick follow-up, how should we view World Cup net win margins relative to your historical net win margins? Thanks.

You've gotta hope that the smaller teams like Haiti, et cetera, just draw with the bigger teams in the early rounds. Like, the early rounds might be a little bit hairy, but it doesn't matter because remember, it's all about if they win on those games, what happens on the next games, and most importantly, what happens in our casino. Let's see. I think it's gonna be interesting. We've never had this many teams. I think on the plus side, you've got engagement with so many games. I said there's like 60, 63% more games, matches. It's actually unbelievable. I think the audience and what we're gonna have in our ecosystem should be really, really, really good.

Thank you.

The cross-sell.

Yeah. Yeah.

The cross-sell of 60% that you pulled out.

Yeah, yeah

I think that's the big benefit as well.

Yeah, absolutely.

All right. Well, looking forward to it. Thanks.

Your next question comes from a line of Clark Lampen from BTIG. Your line is open.

Thanks very much. Maybe I can start with a little bit of a follow-up on Jed's last question. I think in the past, your sportsbook margins have basically peaked at sort of an 18%-19%-ish level, maybe a little bit higher. I guess what I'm wondering is after you sort of fortified the sports trading and, I think pricing, I'm paraphrasing, I guess, from the language in the presentation. What I'm curious is, are book-friendly months, you know, potentially going to produce higher structural sports margins now on a go-forward basis? Quick follow-up question would be on the leadership team comments that you guys put in the release.

Sorry if you've already elaborated on this in the release or in the presentation, but if not, could you give us an update on sort of where you've made hires and where you believe you're sort of strengthening the overall business now? Thanks.

All right. Okay, firstly on the sports margin, we obviously put out there that, you know, that's the average of the two sports books, International and Africa. Yes, as we fortify our pricing and the promotions we give in the sports book, we would think in months where favorites are not winning or just drawing that we are seeing increased margin. That's absolutely, that's for us. Our trailing 24-month average is almost at like 13%, 13.1%, that means Africa's higher and International's a bit lower. We've seen increases in International.

When it comes to our leadership team, listen, for me, this for me and Alinda and actually all of us, even our board, it's all about having the right people in the right seats. Then you will create a super team. We've appointed Kirsty Ross as our Chief Operating Officer. I mean, she was our Chief of Staff, but as Operations Officer, I think we are seeing huge efficiencies. We've hired Justin Stock, who's been our external counsel and helped us to deliver the business to where it is today. We've finally taken him in-house. He's our VP, Head of Commercial and M&A. Of course, as you know, we've got Alon Ben-David as our CTO. We really have a great team at the C-suite level of Super Group.

When you go into the rest of our companies, we are absolutely got great people there. With the International and Africa being these two segments, we're bolstering all of this. In order to grow and keep growing, it's about our people, it's about our platforms, it's about the tech that we're going to use, and we need the best of the best to help us make these decisions. That's what we have done up till now and are taking to the next level.

Neal, if I can just follow up quickly. Is the goal of, I guess, some of that hiring activity to continue driving your corporate costs and the sort of corporate EBITDA that you've now itemized for us down? Maybe it's something different. I guess I'm just curious what you're driving at.

No, both. Both. I think it's definitely always to centralize the costs, not to go to so many third parties. Remember our legal fees, were or can be a lot, especially if you do M&A and other things. With AI, et cetera, it's to definitely bring it down and be able to do much more volume based on our current cost base.

Thank you.

it's everything. Again, we've got to make the right decisions, and we have to make them with the best information we have. That, and for that, I need the best people around us.

Appreciate the color. Thank you.

Your next question comes from a line of Chad Beynon from Macquarie. Your line is open.

All right. Good morning, Neal and Elinda. Nice quarter. Wanted to start with the ZAR Super Coin adoption rate, kind of where this is, how it compares to your expectations. I know that you said in the slide deck, you know, you have plans to roll it out further in the back half, but just wanted to test your temperature on how this is going thus far. Thanks.

Remember we did call out, we said it's going to take adoption, it's going to take time. Obviously we have done a beta now in South Africa, it's gone quite well in terms of our beta, but it's only a beta. We are obviously getting the utility of the coin in there. What we have to do is, it's going to be a slow process to get them adopted. For us, it's not only about the Super Coin, it's also about the processing fees. Remember to remind everyone in Africa, our single biggest after taxes expense are these processing fees, and especially on the sportsbook where they are depositing in, cashing out, redepositing in. This in and out of the same money costs a lot of money.

That ecosystem, we are getting right, and we're just gonna be patient with the ZAR Super Coin and see how it goes. In other markets, we obviously will bring it there once we've seen how it works in South Africa. There's different legislations. Obviously, we all know the legislations in our other seven markets in Africa, and we hope to bring it there as soon as we get this part right in South Africa. Very encouraging. It's something new. It's new for the consumer. It's, let's see how we go. Something that was new a year ago is now normal now, so that's kind of what we base it on, you know?

That's great. Thank you. With respect to the M&A environment, obviously strong Q1, you're tracking at least ahead of expectations for the year, $400 million plus of cash on the balance sheet. How are you thinking about M&A opportunities given your position of strength? Thanks.

Thanks for the question. We feel as we've always been highly selective on what we pursue, we don't need M&A to hit our plan. Our plan is based on consistent organic growth. That will be just an added bonus if the right opportunity comes along and at the right price. It's supposed to be a bolt on, you know, to improve our business overall if we pull the trigger on something. We're also looking at vertical opportunities such as improving technology product or maybe marketing efficiencies. In the long run, there's always something on the table that we are assessing, and we've got the right balance sheet for it. We'll just remain disciplined until the right opportunity at the right price comes.

Yeah. I said, and I always say it to Alinda, and we always say it to each other, we're not overpaying for stuff. If it makes sense, we'll do it. I think as we've, you know, we've got a facility, I think you've seen lots of our competitors have acquired over the last five or 10 years, and when you laden with debt after that, these businesses have to perform. We've still got 75% free cash flow because, you know, that's what we do. If we find the right one, we'll do it. We are not overpaying, and that's not how we've operated up until now.

Thank you.

Your next question comes from a line of Matthew Weber from Canaccord Genuity. Your line is open.

Hi. Thanks so much for taking the question, and congrats on the strong quarter. I just wanted to ask if there's any update you could share on the Apricot transaction and just maybe more broadly how that transaction is framing your key product initiatives for the balance of the year. Relatedly, could you just given AI is the topic du jour of every earnings call, could you maybe just touch on what you were doing there in that space? Thanks so much.

The Apricot, we finally closed the transaction at the end of February. We've got all the IP, the sportsbook finally is owned by us, we're very happy about it. We've done the progress of moving all the development resources that support the sportsbook. They're now becoming part of our team. Expect over 100 people even more to move over to Super Group, be part of our structures, how we work, what we do. We're really starting to see overall realized cost savings will obviously come over time. For us, it's about the product. That's near our product teams here. The teams are together, and I think we've seen that with the global Betway sportsbook. We've improved speed, flexibility, efficiency, there's lots to come there. You know, we really are pushing hard.

You know, since we've exited the U.S., I've got these teams not having to worry about the eight states in the U.S. We can worry about all the markets that we're currently in.

Just on your follow-on question on AI, I think it's front of mind for everyone. It's definitely at the moment for us a tool, initiatives that we use for risk and fraud management. There is definitely some elements being used in development and allowing us to be more efficient and move faster in deploying certain parts of our development in our businesses. It's definitely it's starting to have a big impact even on my world in finance and how we reconcile and look at and accounts and disclosures. It's definitely all in all enhancing efficiencies, but we have to be disciplined.

We are working closely along our CTOs, taking lead on making sure there's a custodian that creates the boundaries around this so that we are disciplined around it. Major impact. I think the only thing we know is that it's changing fast.

Fair enough. Thanks for the color.

Your next question comes from a line of Jordan Bender from Citizens. Your line is open.

Hi, this is Isabel Slavin on for Jordan Bender. Thank you for taking our questions. We just want to ask about Europe. What drove the outperformance there, and do you expect this to continue throughout the year? Thank you.

I think Europe, again, as we exited countries that we didn't see a path to profitability, U.S. being one, Belgium, Italy, et cetera, we focus on the U.K., Spain, Ireland. If you take the U.K. as an example, as we drop in more product enhancements, the brand is well known. We are seeing the stickiness of our customers, our marketings being really driving record acquisitions 'cause finally the Betway product enough for competing head-on with our major competitors there. Same with Spain. We've got focus to casino. We've got new stuff happening there. Ireland as well. It's all about the front office being the product and our brilliant back office coming together.

In Africa, we have got a brilliant product, and we've got a back office, and we're improving the back office to make it as good as the international side. If we get all of those two worlds working, that's when you see the bottom. That's where you see our retention rates, et cetera, going increasing.

Okay. Thank you.

There are no further questions. I will now turn the call back over to Neal Menashe for closing remarks.

Thank you everyone for joining today's call. We are really proud of our teams across the globe and their super performance this quarter. We are very encouraged by the momentum we have built early in the year, and we will speak to you again soon. Thank you.

This concludes today's conference call. Thank you for your participation. You may now disconnect.