[PPT] - Q4 2017 Q4 2017 Presenters GUSTAF VIKTOR HAGMAN FRITZN Group PowerPoint Presentation

SLIDE 1

Q4 2017 Q4 2017

SLIDE 2

GUSTAF HAGMAN VIKTOR FRITZÉN

Group CEO and Co-founder Group CFO 2

Presenters

SLIDE 3

Leading the way into the mobile future

3

The Leo Passion

SLIDE 4 4

The growth company LeoVegas

GameTech Effective marketing A fantastic company culture

Strategy

Expansions strategy Expand in regulated markets and markets that are soon be regulated and to carry out strategic and complementary acquisitions Product Strategy To be the most innovative and creative company in the gaming industry

SLIDE 5 5

Agenda genda

Acquisition of IPS (Rocket X)
Quarterly report highlights
Business update
Business KPIs
Financials
Financial Targets
Summary
Q&A

SLIDE 6

Acquisition cquisition

IPS and associated assets – “Rocket X"”

6

SLIDE 7 7

Rocket X

Why Rocket X Rocket X Revenues: GBP 11.7 m YoY growth 49% Adjusted EBITDA of EUR 3.8 m.1 UK accounted for 96% of revenue 73% of revenues generated from Mobile devices Rocket X in Q4’17 85 employees Office in Newcastle Assets will be transferred unto LeoVegas licenses Casino and Bingo Bede Platform Strengthen our position in the UK Local multibrand strategy to complement the global brands LeoVegas and Royal Panda Efficient marketing strategy independent from affiliates Great team Cultural fit Inline with our expansion strategy During the past two years we have searched for companies that fit in with our overall expansion strategy, which is to grow in regulated markets and markets soon-to-be regulated 1 EBITDA is adjusted for a platform agreement in which EBITDA for Q4 2017 has been recalculated as if the agreement that LeoVegas has for the platform from the closing date of the acquisition applied for the entire Q4 2017. IPS has conducted limited white label business that has contributed to sales for 2017, but which has had a neutral effect on EBITDA. This business is not included in the transaction. Some minor cost items in the month of December have been estimated

SLIDE 8 8

Rocket X

Purchase price and completion GBP 65m (EUR 73.5m at exchange rate 1.13 GBP/ EUR) No earn-out The transaction is subject to certain closing conditions, and is scheduled to close late in the first quarter of 2018 Financing Will utilize excess cash at hand and the remainder will be drawn from the debt facility LeoVegas secured in Q4

SLIDE 9 9

Setting the stage for German expansion

Licenses Agreement to acquire all of the shares in the Maltese company World of Sportsbetting Ltd, Purchase price

f 2.6 MEUR

Sports betting and casino licenses in the state of Schleswig-Holstein An approved application for a sports betting license in Hesse, under the Interstate Treaty on Gambling In line with LeoVegas expansion strategy, focus on regulated markets New ambassadors Strong profiles in the Sports community Lothar Matthäus – Football legend Stefan Kretzschmar is a former handball star This will strengthen LeoVegas position and continued high growth in Germany What does this mean? With the application for a sports betting license in Hesse – able to to freely market the sports betting

ffering throughout Germany

Additional opportunities within marketing and improved and more attractive payment solutions Able to apply the licenses in Schleswig-Holstein for Royal Panda

SLIDE 10

Full year ull year 2017 2017

Highlights

10

SLIDE 11

Team:

+201Employees

Total: 566

Adjusted EBITDA:

12.9 %

Growth: +53 %

11

Full year 2017

Adjusted EBITDA:

27.9 MEUR

Revenue:

217MEUR

SLIDE 12 12

Awards in 2017 and beginning of 2018

SLIDE 13

Quart Quarterly erly report eport

Highlights and events

13

SLIDE 14

Revenue since launch

67.8 MEUR

10.0

20.0 30.0 40.0 50.0 60.0 70.0 65% 65% Q4’17 growth Y-Y 48% 48% Q4’17 growth excl. acquisitions Y-Y (organic growth) 82% 82% Q4’17 growth excl. acquisitions and closed markets (Australia, Czechia, Slovakia) Y-Y

SLIDE 15

Revenue:

67.8 MEUR

+26.6 MEUR Adjusted EBITDA:

7.1 MEUR

10.5 % margin

NDCs

128 409

All time high in value generated

Growth:

+65 %

Organic growth: 48%

Mobile deposits:

69 %

15

Q4 2017 Highlights

SLIDE 16 16

compared to January last year Current Trading – Start of Q1

24.8 MEUR 76 %

NGR January 2018 an increased of

72 %

excluding acquisitions and closed markets

SLIDE 17

Busine Business updat s update

17

SLIDE 18 18

Listed on Nasdaq Stockholm, Main market

Listing changed to Nasdaq Stockholm on February 5 Unicorn status: Valuation of

ne billion USD

Proposed dividend of SEK 1.20 (1.00) per share, amounting to approximately SEK 120 million (EUR 12.2 million)

SLIDE 19 19

Business update

Expansion in Canada - free to play site - LeoVegas.net At LeoVegas.net casino games are offered to try and play for free Swedish hockey legend Mats Sundin to serve as an ambassador Credible and popular profile, which provides great

pportunities from a marketing perspective

Executive management Caroline Palm – Chief Human Resources officer (CHRO) – new role Jarl Modén - permanent Chief Product Officer (CPO) Both part of executive management

SLIDE 20 20

Product innovations

Apple Pay launched in UK, more markets to come, only available in regulated markets Using state-of-the-art technology, launching facial recognition for log-ins and approval of payments using Apple Pay Improved live streaming offering in the Nordic markets with 10,000 live broadcast sport events LeoVegas has worked intensively and closely with a number of game developers – to come up with innovative and exclusive games – “LeoVegas Originals” Authentic Gaming Exciting news with an agreement with Foxwoods Casino, USA's largest casino venue. For the first time, it is possible for European players to play Live Casino, online streaming directly from a casino in the United States

SLIDE 21 21

Royal Panda

Royal Panda contributed with 5.6 MEUR in Q4 which is a lower figure compared to Royal Pandas Q3 revenue This is because Royal Panda is

nly included for two months in

Q4 and that Royal Panda closed a number of markets for similar reasons as LeoVegas closed Czech Republic and Australia This is according to plan and adjusted for these markets, Royal Panda grew 57 percent in Q4 Royal Panda has had a strong

pening to 2018 with 3.8 MEUR
f NGR in January

Revenue Nov-Dec:

5.6 MEUR

Revenue:

5.6 MEUR

Like for like growth in Q4’17:

57 %

January 2018 NGR

3.8 MEUR

Revenue:

5.6 MEUR

Q4’17 % of Group revenue:

8.3%

January 2018 % of Group revenue:

15.4%

SLIDE 22 22

LeoVegas’ strategy is to enter regulated markets and markets that are soon to be regulated Regulated revenues in Q4’17 were 29% of total

Regulated revenues

UK 17% Italy 3% Denmark 9% 71% Q4 2017 29% of NGR from regulated markets

SLIDE 23

Busine Business s KPI’ KPI’s

23

SLIDE 24

Q3’17 back-drop Q4’17

Q4’17 drivers

RDCs 18% Q-Q growth NDCs 32% Q-Q growth Revenue 22% Q-Q growth 97 210 NDCs in Q3’17 22.6 MEUR in marketing 29.5 MEUR in marketing Deposits 16% Q-Q growth

24 Royal Panda added 10% pnts Royal Panda added 9% pnts Royal Panda added 7% pnts Royal Panda added 10% pnts Royal Panda 2.3 MEUR +30%

Acquisition of Royal Panda

SLIDE 25

20 000

40 000 60 000 80 000 100 000 120 000 140 000 2015-Q4 2016-Q1 2016-Q2 2016-Q3 2016-Q4 2017-Q1 2017-Q2 2017-Q3 2017-Q4 New depositing customers (NDCs) Returning depositing customers (RDCs)

New depositing customers

(NDCs) increased 32% sequentially

NDCs grew 22% sequentially

excluding the acquisition of Royal Panda

The growth in NDCs is very

broad-based with nearly all markets seeing material increases

Returning Depositing

Customers (RDCs) growth was 18% sequentially

RDC growth excluding Royal

Panda was 9%

RDC growth excluding Royal

Panda and Australia (which was shut down on September 10) was 15% sequentially

The strong RDC growth

figure is mainly driven by the strong NDC development in Q3’17 Depositing customers, new and returning COMMENTS 25

Customer base

128 409 124 890 +32% +18%

SLIDE 26

As the proportion of RDCs in

the mix has a material effect

n the average deposit per

depositing customer – it can be seen how the proportion

f RDCs correlates with

average deposit per depositing customer

In Q4’17 there was a large

increase in NDCs, which means its proportion of the depositing customer base was larger, which in turn decreased the average deposit per depositing customer

Average deposit per

depositing customer decreased with the proportion of RDCs, as the average deposit per RDC was stable from Q3’17

Average NGR per depositing

customer decreased slightly less as hold increased slightly 26

Average spend per customer

COMMENTS Deposits EUR per depositing customer NGR EUR per depositing customer

50

100 150 200 250 300 NGR per depositing customer 0% 10% 20% 30% 40% 50% 60%

100

200 300 400 500 600 700 800 900 1 000 Deposits per depositing customer Propotion of RDCs in the depositing customer base

SLIDE 27 2017-Q3 2017-Q4 Marketing Indexed to Q3'17 NDCs Indexed to Q3'17 Marketing / NDC (CAC)

Marketing spend increased by

30% from Q3’17 to 29.5 MEUR in Q4’17, which is the highest level in LeoVegas’ history

NDCs increased by 32% in the

same period

The Customer Acquisition

Cost (CAC), illustrated in the chart as marketing in relation to NDCs, in Q4’17 decreased 1% compared to Q3’17

The growth in NDCs is very

broad-based across countries

ROI in Q4’17 has continued

the strength from Q3’17 resulting in the best quarter ever in value generation from new customers 27

Marketing and customer acquisition cost

COMMENTS Marketing spend and NDCs indexed to Q3’17 in relation to marketing per NDCs +30%

1%

128 409 29.5 MEUR +32% 22.6 MEUR 97 210

SLIDE 28

In Q4’17 deposits grew 62% Y-

Y, excluding the acquisition of Royal Panda deposit growth was 52%

On a sequential basis deposits

increased 16%, and excluding Royal Panda 9%

Growth rates per regions,

numbers in brackets are excluding Royal Panda:

Sweden 35% (34%)
Other Nordics 131% (129%)
UK 94% (55%)
Rest of Europe 104% (88%)
Rest of World -45% (-51%)
Deposits increased by 85.5

MEUR (71.9) from Q4’16 to Q4’17 of which the regions accounted for (numbers in brackets are excluding Royal Panda):

Sweden 21.2 MEUR (20.5)
Other Nordics 29.2 MEUR

(28.9)

UK 20.1 MEUR (11.7)
Rest of Europe 21.1 MEUR

(17.8)

Rest of World -6.2 MEUR

(-7.1) 28

Deposits

COMMENTS Deposits MEUR and Q-Q growth in deposits % Deposits MEUR by region

10.0

20.0 30.0 40.0 50.0 60.0 70.0 80.0 90.0 Sweden Other Nordics UK Rest of Europe Rest of World 0% 5% 10% 15% 20% 25% 30%

50.0

100.0 150.0 200.0 250.0 Deposits Q-Q growth rate in deposits

SLIDE 29 29

UK has seen the largest

increase in share of both deposits and NGR due to the acquisition of Royal Panda, but supported by one of the strongest quarters in the UK

rganically
Rest of Europe had a large

increase also due to Royal Panda and also strong underlying growth

Other Nordics remained

stable as growth was strong at LeoVegas and the addition from Royal Panda was small

Sweden grew at a healthy

pace, but decreased it share

f total as other markets grew

faster in percentage terms

Rest of World decreased as

Australia was shut down on September 10

Regional split

COMMENTS Sweden 37% Other Nordics 23% United Kingdom 18% Rest of Europe 19% Rest of World 3% Deposits 2017-Q4 Sweden 41% Other Nordics 22% United Kingdom 14% Rest of Europe 17% Rest of World 6% Deposits 2017-Q3 Sweden 33% Other Nordics 22% United Kingdom 17% Rest of Europe 22% Rest of World 6% NGR 2017-Q4 Sweden 37% Other Nordics 23% United Kingdom 12% Rest of Europe 18% Rest of World 10% NGR 2017-Q3

SLIDE 30 Sweden 33% Norway & Finland 13% Denmark 9% UK 17% Italy 3% Rest of Europe 18% Rest of World 6% 30

NGR by country and region

In addition to the

geographical regions that LeoVegas reports, some countries are sometimes reported for specific reasons

In Q4 LeoVegas has reported,

in addition to the regions, the NGR from the regulated markets Italy and Denmark COMMENTS NGR split all reported countries and geographies Q4 2017

SLIDE 31 31

Game margin is defined as

the winnings LeoVegas has divided by the total amount

f bets, i.e. what percentage

LeoVegas on average wins on a bet

Hold is defined as NGR

divided by deposits

Game margin and Hold are

correlated with each other, and periods with lower margin are often associated with lower Hold

Game margin in Q4’17 was

very close to its historical average

However, hold in Q4’17

increased to 30.2%, which is driven by the consolidation of Royal Panda

The hold at Royal Panda for

the period November- October was 39.8%

Hold excluding Royal Panda

saw a small increase to 29.6%

Game margin and Hold

COMMENTS Game margin % and Hold in % 25.0% 27.0% 29.0% 31.0% 33.0% 35.0% 37.0% 3.40% 3.45% 3.50% 3.55% 3.60% 3.65% 3.70% 3.75% 3.80% 3.85% 3.90% 2015-Q1 2015-Q2 2015-Q3 2015-Q4 2016-Q1 2016-Q2 2016-Q3 2016-Q4 2017-Q1 2017-Q2 2017-Q3 2017-Q4 Game margin % Hold %

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Deposits from mobile devices

decreased mainly due to the consolidation of Royal Panda that has a slightly lower mobile usage than LeoVegas

Mobile devices accounted for

69% of deposits in the quarter

Deposits from mobile devices

grew 66% year on year, while the same for desktop grew 52% 32

Mobile share of deposits

COMMENTS Deposits through mobile devices as a % of total deposits 50% 55% 60% 65% 70% 75% 2015-Q1 2015-Q2 2015-Q3 2015-Q4 2016-Q1 2016-Q2 2016-Q3 2016-Q4 2017-Q1 2017-Q2 2017-Q3 2017-Q4 Mobile deposits as a % of total

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FINANCIAL FINANCIALS S

SLIDE 34

In Q4’17 adjusted EBITDA was

7.1 MEUR, a margin of 10.5%

Cost of sales as a percentage
f revenue increased mainly

due to higher gaming taxes in Denmark and the UK

Personnel expenses as a

percentage of revenue came back to a more normalised level following vacation pay in Q3 that decreased the ratio

Operating expenses (excluding

costs related to acquisitions and listing) were stable in relation to revenue

Marketing in relation to

revenue increased to the highest level of 2017, in line with what was communicated last report 34

P&L per quarter adjusted

COMMENTS P&L MEUR adjusted* P&L ratios adjusted* *Adjusted for listing-related expenses in Q4’15, Q1’16, Q1’17-Q4’17 and expenses related to acquisitions in Q3’17-Q4’17 1.7 4.0

2.5

9.8 10.0 6.2 6.1 8.4 7.1 13.3 12.5 18.7 14.3 14.9 18.8 20.8 22.6 29.5 3.1 2.9 3.6 2.8 3.1 3.8 4.8 5.4 6.4 2.4 3.3 3.7 4.1 3.9 5.1 6.2 4.8 6.6 5.6 6.9 7.4 8.6 9.3 9.9 11.7 14.4 18.2

10.0
10.0

20.0 30.0 40.0 50.0 60.0 70.0 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017 Q3 2017 Q4 2017 Cost of sales Personnel costs net of capitalised development costs Operating expenses including other income Marketing expenses EBITDA 6.7% 13.5%

7.9%

24.7% 24.2% 14.0% 12.4% 15.1% 10.5% 50.9% 42.3% 60.4% 36.1% 36.2% 42.9% 41.9% 40.7% 43.4% 11.8% 9.9% 11.7% 7.1% 7.6% 8.8% 9.7% 9.7% 9.4% 9.1% 11.0% 11.9% 10.4% 9.5% 11.7% 12.4% 8.5% 9.8% 21.6% 23.2% 23.9% 21.7% 22.5% 22.6% 23.7% 26.0% 26.9%

20%

0% 20% 40% 60% 80% 100% Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017 Q3 2017 Q4 2017 Cost of sales Personnel costs net of capitalised development costs Operating expenses including other income Marketing expenses EBITDA

SLIDE 35

Due to the acquisition of Royal

Panda several new items have appeared in the P&L

In Q4’17 there were in total 4.0

MEUR of non-cash items consisting of increased amortisation, 3.0 MEUR, and discounting of the earn-out, 1.0 MEUR

Adding these items back to

Net Income would give a Net Income of 5.5 MEUR with a margin of 8.1%

The 5.5 MEUR figure would be

comparable to Net Income in previous periods when these non-cash acquisition related items were not part of the P&L 35

From Adjusted EBITDA to Net Income

COMMENTS Q4’17 P&L from Adjusted EBITDA to Net Income, MEUR 7.1

0.2
0.8

6.1

1.1
3.0

2.1

0.1
1.0

0.9 0.1 0.7 1.5 4.0 5.5

1.0

2.0 3.0 4.0 5.0 6.0 7.0 8.0 Items in EBITDA affecting comparability Non-cash items relating to accounting for acquisition

f Royal Panda

Net income excluding non- cash acquisition related items

SLIDE 36

65.0%
60.0%
55.0%
50.0%
45.0%
40.0%
35.0%
30.0%
15.0%
10.0%
5.0%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 Mark Marketing e eting expense xpense, % of , % of revenues, nega enues, negativ tive scale e scale Adjus djusted EBIT mar ed EBIT margin % gin % Adjusted EBITDA margin % Marketing expenses % of revenues

58.0%
56.0%
54.0%
52.0%
50.0%
48.0%
46.0%
44.0%
42.0%
40.0%

0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0% 16.0% 2014 2015 2016 2017 Mark Marketing e eting expense xpense, % of , % of revenues, nega enues, negativ tive scale e scale Adjus djusted EBIT mar ed EBIT margin % gin % Adjusted EBITDA margin % Marketing expenses % of revenues

The marketing to revenue

ratio is the key determinant

f the profit margin

development at LeoVegas

The marketing to revenue

ratio in Q4’17 was 43.4%, which is the highest level in six quarters although the ratio has been rather stable throughout 2017

LeoVegas’ margins have

been, and can likely continue to be, volatile between quarters, but will average out at levels that are consistent with LeoVegas’ long term financial target – to have a, EBITDA margin of around 15%

The marketing to revenue

ratio in Q1’18 is expected to be slightly lower than the average for 2017 36

Marketing spend and margin

COMMENTS Marketing to revenue % (negative scale) and Adjusted* EBITDA margin %, quarterly 10.5% EBITDA margin 12.9% EBITDA margin Marketing to revenue % (negative scale) and Adjusted* EBITDA margin %, annually *Adjusted for listing-related expenses in Q4’15, Q1’16, Q1’17-Q4’17 and expenses related to acquisitions in Q3’17-Q4’17

SLIDE 37 37

Following the acquisition of

the Royal Panda Group, the balance sheet has seen a significant change

The balance sheet total is

now at 185 MEUR up from 98 MEUR at the end of Q3’17

On the asset side the main

change is intangible assets and goodwill which mainly relate to the acquisition of Royal Panda

On the equity and liabilities

side there are two main changes, which are the bank loan of 20 MEUR and earn-

ut related liabilities
The earn-out related

liabilities include 10 MEUR in deferred payment which was part of the base purchase price for Royal Panda and also includes 4 MEUR related to the acquisition of Casino Grounds

Overall working capital

related items have increased due to the consolidation of Royal Panda

Balance sheet

COMMENTS Assets MEUR 31 December 2017 Equity and liabilities MEUR 31 December 2017 Cash and cash equivalents, 66.6 Current assets, 14.8 Property, plant and equipment, 2.0 Intangible assets, 14.8 Equity, 57.4 Payables and accruals, 32.7 Player liability, 4.8 Other liabilities, 3.3 Assets MEUR 30 September 2017 Equity and liabilities MEUR 30 September 2017 Cash and cash equivalents, 52.8 Current assets, 22.3 Property, plant and equipment, 2.9 Goodwill, 44.6 Intangible assets, 62.5 Equity, 58.9 Payables and accruals, 42.1 Player liability, 7.1 Other liabilities, 6.8 Bank loan, 20.0 Earn-out related liabilities, 50.0 Balance sheet total 185 MEUR Balance sheet total 98 MEUR

SLIDE 38 66.6 6.1

1.2

3.1

0.8
0.9

20.0

40.3

0.1 52.8

10.0

20.0 30.0 40.0 50.0 60.0 70.0 80.0 90.0 100.0 Cash and cash equivalents at beginning

f period

EBITDA Adjustments for non-cash items Change in working capital Investments in tangible assets Investments in intangible assets Loan financing Investment in subsidiaries Other movements Cash and cash equivalents at end of period Cash flow from operating activities 8.0 MEUR Cash flow from investing activities excluding acquisitions -1.6 MEUR 38

Cash flow

Cash decreased by 13.9

MEUR in the quarter

Excluding all acquisition

related movements cash would have increased by 6.5 MEUR in the quarter

Cash flow from operating

activities increased by 8.0 MEUR driven by the EBITDA result and changes in working capital

Investing cash flow before

acquisition related investing was of -1.6 MEUR was equally driven by investments in intangible and tangible assets and similar to the previous quarter

The acquisition of Royal

Panda Group resulted in a net

utflow of 40.3 MEUR which

is a combination of the initial purchase price of 50 MEUR (which excludes the deferred payment of 10 MEUR), net of cash in the Royal Panda Group COMMENTS Cash flow MEUR Q4 2017 Total decrease in cash 13.9 MEUR

SLIDE 39

Financial inancial Tar argets gets

39

SLIDE 40 40

Financial targets

LeoVegas long-term financial targets: Long-term organic growth above online gaming market Long-term at least 15% EBITDA margin assuming 100% regulated markets LeoVegas dividend policy is to distribute a minimum of 50% of net profit

ver time

SLIDE 41 41

Summary Summary

SLIDE 42

Revenue growth of 65% and an adjusted EBITDA of 7.1 MEUR a 10.5% margin Underlying growth at LeoVegas at 82% Acquisition of Royal Panda, Casino Grounds and Rocket X €100m debt financing January NGR of 24.8 MEUR 76% growth Nasdaq, Stockholm – Main market Proposed dividend of 1.20 SEK per share

42

Summary

SLIDE 43

Q& Q&A A

43

SLIDE 44

APPENDIX APPENDIX

44

SLIDE 45 50.0 51.0 52.0 53.0 54.0 55.0 56.0 57.0 58.0 59.0 60.0 61.0 62.0 63.0 64.0 65.0 66.0 67.0 68.0 69.0 70.0 Revenue in constant currency Currency movement Reported Revenue 68.4 68.7 45

Revenue in constant currency

would have been 68.4 MEUR

The movement in the SEK was

the most material and was about half of the total negative effect

Constant Currency Revenue

COMMENTS MEUR

0.6

SLIDE 46 46

Regulated and soon to be regulated markets for LeoVegas

Markets where LeoVegas has a gaming license Country Tax structure 0.5% on Sports turnover and 1.5 KEUR per license 15% on GGR 20% on GGR Markets LeoVegas pays gaming taxes or VAT but without license* Country Tax structure 23% VAT on Casino 19% VAT 40% tax on GGR Soon to be regulated markets where LeoVegas has presence Country Expectation 18% on GGR expected Q1’19 29% on GGR expected Q3’19 *No local license regime is in place Sports 1% on Turnover Casino 20% and Sports 22% on GGR Italy Ireland Denmark UK Malta Ireland Germany Austria Sweden The Netherlands

SLIDE 47 Market size increase Marketing channels open up Decrease in marketing clutter Increase or decrease in competition Changing competetive position of Svenska Spel Supply chain absorbtion of tax Decrease in bonus costs 10 20 30 40 50 60 70 80 90 100 10 20 30 40 50 60 70 80 90 100 Positiv

sitive / Nega

e / Negativ tive Impact e Impact Pr Probability

bability

47

Potential dynamic effects in the Swedish market after regulation

Effects when market regulates Marketing clutter Positive and negative effects assessed against probability of occurring More channels Competition Supply chain Bonus costs Market size may decrease as competitors scale back marketing to protect margins in marketing open up changes as small companies leave, but large UK operators could enter absorbs its share of the gaming tax just as in the UK market may decrease as competitors scale back to protect margins may increase Svenska Spel will change its competitive position

SLIDE 48 48

Hypothetical EBITD Hypothetical EBITDA impact in S A impact in Sweden with 18% tax on GGR eden with 18% tax on GGR

Example of potential EBITDA impact in market with 18% tax on GGR

This is a hypothetical

example of the EBITDA for LeoVegas in the Swedish market if an 18% gaming tax

n GGR is implemented
Tax of 18% on GGR means

that bonus rounds get taxed at 18% as well, this adds ca. 3% points to the tax impact

There are several positive

factors from regulation that mitigate the negative effects

n EBITDA from the tax
An increased market size has

the potential to have a very large impact on the absolute EBITDA level even though margins will be lower

We expect that roughly half
f the tax will naturally be
ffset and half will impact

profitability – assuming that marketing investments are not scaled back

Decreases in marketing can

further improve the EBITDA margin, if that is the right choice for the business at that point COMMENTS 18 3 2 3 1 1 1 3 10 5 10 15 20 Gaming tax 18% Tax on bonuses (not included in EBITDA) Market size increase Marketing channels

pen up

Decrease in marketing clutter Decrease in bonus costs Increase or decrease in competition Supply chain absorbtion

f tax

Impact on EBITDA before changes in marketing spend Decrease in marketing Per ercentage point impact on EBITD entage point impact on EBITDA mar A margin gin

SLIDE 49

4 MAIN KPIS QUARTERLY

NDCs 128 890 (last quarter 97 210) RDCs 124 890 (last quarter 105 770) Deposits €224.6M (last quarter €193.1M) NGR €67.9M (last quarter €55.2) 49

50

100 150 200 250 2012-Q1 2012-Q2 2012-Q3 2012-Q4 2013-Q1 2013-Q2 2013-Q3 2013-Q4 2014-Q1 2014-Q2 2014-Q3 2014-Q4 2015-Q1 2015-Q2 2015-Q3 2015-Q4 2016-Q1 2016-Q2 2016-Q3 2016-Q4 2017-Q1 2017-Q2 2017-Q3 2017-Q4 Deposits

10

20 30 40 50 60 70 2012-Q1 2012-Q2 2012-Q3 2012-Q4 2013-Q1 2013-Q2 2013-Q3 2013-Q4 2014-Q1 2014-Q2 2014-Q3 2014-Q4 2015-Q1 2015-Q2 2015-Q3 2015-Q4 2016-Q1 2016-Q2 2016-Q3 2016-Q4 2017-Q1 2017-Q2 2017-Q3 2017-Q4 NGR

20 000

40 000 60 000 80 000 100 000 120 000 140 000 2012-Q1 2012-Q2 2012-Q3 2012-Q4 2013-Q1 2013-Q2 2013-Q3 2013-Q4 2014-Q1 2014-Q2 2014-Q3 2014-Q4 2015-Q1 2015-Q2 2015-Q3 2015-Q4 2016-Q1 2016-Q2 2016-Q3 2016-Q4 2017-Q1 2017-Q2 2017-Q3 2017-Q4 NDCs

20 000

40 000 60 000 80 000 100 000 120 000 140 000 2012-Q1 2012-Q2 2012-Q3 2012-Q4 2013-Q1 2013-Q2 2013-Q3 2013-Q4 2014-Q1 2014-Q2 2014-Q3 2014-Q4 2015-Q1 2015-Q2 2015-Q3 2015-Q4 2016-Q1 2016-Q2 2016-Q3 2016-Q4 2017-Q1 2017-Q2 2017-Q3 2017-Q4 RDCs