Half Year 2026 ZEAL Network SE Earnings Call

August 5, 2026

Frank Hoffmann: With that, I'm handing over to you, Andrea.

Speaker #1: I'm handing over to you, Andrea.

Speaker #2: Thanks a lot, and good morning, everyone. Welcome to ZEAL's earnings call presentation for the first half-year of 2026. I'm Andrea Behrendt, the CFO of ZEAL, and I'm joined today by our CEO, Stefan Tweraser.

Andrea Behrendt: Thanks a lot. Good morning, everyone, and welcome to ZEAL's earnings call presentation for H1 2026. I'm Andrea Behrendt, the CFO of ZEAL, and I'm joined today with our CEO, Stefan Tweraser. The presentation is available on our investor section and our website. With that, I will guide you through the agenda. Like always, we will start with the highlights of the first six months of the year. I will take you to the financial and operational performance before we give you an update on our strategic progress and the 2026 guidance. We will close with the key takeaways and open up for a Q&A session. With that, I hand over to Stefan.

Speaker #2: The presentation is available on our investor section and our website. With that, I will guide you through the agenda. As always, we will start with the highlights of the first six months of the year. Then I will take you through the financial and operational performance before we give you an update on our strategic progress and the 2026 guidance.

Speaker #2: We will close with the key takeaways, and then open up for a Q&A session. And with that, I hand over to Stefan.

Speaker #3: Good morning from my side as well, everybody. Thanks for joining our call. I’m happy to report that the first half of 2026 has delivered a record in revenue, very profitable growth, and we’ve been able to continue our strategic diversification.

Stefan Tweraser: Good morning from my side as well, everybody. Thanks for joining our call. I'm happy to report that H1 2026 has delivered a record in revenue, very profitable growth, and we've been able to continue our strategic diversification. To give you a couple of more details, we delivered the strongest H1 in ZEAL's history, achieving record number of revenues alongside double-digit growth in both EBITDA and profit. This demonstrates that our strong top-line momentum continues to translate into very profitable bottom-line growth. We've also reached record levels of new customer acquisition, further strengthening the foundation for future growth. Through our social lotteries, we continue to support prominent charitable organizations in total. We are very proud of this. We have already contributed around EUR 240 million to public welfare in 2026.

Speaker #3: To give you a couple more details, we delivered the strongest first half-year in ZEAL's history, achieving record numbers in revenues alongside double-digit growth in both EBITDA and profit.

Speaker #3: This demonstrates that our strong top-line momentum continues to translate into very profitable bottom-line growth. We've also reached record levels of new customer acquisition, further strengthening the foundation for future growth.

Speaker #3: Through our social lotteries, we continue to support prominent charitable organizations, and we are very proud of this. In total, we have already contributed around $240 million to public welfare in 2026.

Speaker #3: And from a strategic perspective, we successfully launched Tram Autoverlosung in Germany, expanding our product portfolio beyond traditional lotteries. We have also concluded the acquisition of 7Canyon in the UK, which represents another important step in our continued diversification.

Stefan Tweraser: From a strategic perspective, we successfully launched Traumautoverlosung in Germany, expanding our product portfolio beyond traditional lotteries, and we have concluded the acquisition of SevenCanyon in the UK, which represents another important step in our continued diversification. Overall, H1 2026 combined record financial performance, strong operational execution, and meaningful strategic progress. I'll hand back to Andrea to dive into the numbers for you guys.

Speaker #3: So overall, the first half of 2026 combined record financial performance, strong operational execution, and meaningful strategic progress. I'll hand back to Andrea to dive into the numbers for you guys.

Speaker #2: Thanks, Stefan. So, like always, let's put our results into context for the jackpot environment in Germany. The jackpot environment improved in the second quarter of this year, particularly in Lotto 6 out of 49.

Andrea Behrendt: Thanks, Stefan. Like always, let's put our results into context for the jackpot environment in Germany. The jackpot environment improved in Q2 of this year, particularly in Lotto 6 out of 49. Lotto 6 out of 49 reached its €50 million maximum for the first time ever and remained for this in 10 consecutive draws in Q2, and continues until today. Let's see what is happening today. Its average jackpot increased to €27 million compared to €8 million in the prior year period. Eurojackpot reached its €120 million maximum in May and remained there for 2 draws. The average level was €43 million and is slightly below last year's numbers. Overall, the extended Lotto 6 out of 49 rollover sequence more than offsets the slightly lower average Eurojackpot levels.

Speaker #2: Lotto 6 out of 49 reached its €50 million maximum for the first time ever and remained at this level for 10 consecutive draws in Q2.

Speaker #2: And continues until today. So, let's see what is happening today. Its average jackpot increased to €27 million compared to €8 million in the prior year period.

Speaker #2: EuroJackpot reached its €120 million maximum in May and remained there for two draws. The average level was €43 million, and it was slightly below last year's numbers.

Speaker #2: Overall, the extended Lotto 6 out of 49 rollover sequence, more than offsets the slightly lower average jackpot Euro jackpot levels. And we added an additional slide this time in, because it's the first time we had a 50 million Lotto jackpot on 50 million, and we wanted to illustrate how this jackpot drives past some activity and billings.

Andrea Behrendt: We added an additional slide this time in, because it's the first time we had a EUR 50 million Lotto jackpot on EUR 50 million, and we wanted to illustrate how this jackpot drives customer activity and billings, and how this also compares to Eurojackpot here. That's not only for ZEAL, but for the overall market. For Lotto 6 out of 49, the €50 million jackpot remains in place with a wide range of draws, as I told you already. Compared to low jackpot reference draws, the billings increased by 33%, with a strong uplift in Wednesdays with 45% and on Saturdays with 26%. On the other hand, we have Eurojackpot, and if the Eurojackpot reaches its top maximum at EUR 120 million, we see that billings increase by 149% in the market above the normal minimum jackpot reference.

Speaker #2: And how this also compares to EuroJackpot here. And that's not only for ZEAL, but for the overall market. So, for Lotto 6 out of 49, the €50 million jackpot remains in place with a wide range of draws, as I told you already.

Speaker #2: And compared to low-jackpot reference draws, the billings increased by 33%, with a strong uplift on Wednesdays of 45% and on Saturdays of 26%.

Speaker #2: On the other hand, we have Eurojackpot, and if the Eurojackpot reaches its top maximum at €120 million, we see that billings increase by 149% in the market, above the normal minimum jackpot reference.

Speaker #2: And this translated into Tuesday numbers of 171% and Friday's numbers of 134%. In summary, it's really important to see that both jackpots drive significant growth, but the relative increase for EuroJackpot is over four times higher than Lotto 6 out of 49.

Andrea Behrendt: This translated in Tuesday numbers of 171% and Friday's numbers of 134%. In summary, it's really important to see that both jackpots drive significant growth, but relatively increase, the Eurojackpot is over 4 times higher than Lotto 6 out of 49. This is just that we wanted to share with you because it's for the first time happening, and I think it's important to put that in context for our results and also for Q3 results. Now, let's turn into our P&L. I want to share my highlights with you here. Of course, revenue growth by 20%, a great number. Lotteries grew by 20% and games by 17%. On the other hand, the operating expenses increased, but with deliberate investment decisions that we are taking into growth.

Speaker #2: This is just what we wanted to share with you, because it's happening for the first time, and I think it's important to put that in context for our results and also for Q3 results.

Speaker #2: Now, let's turn to our P&L. I want to share my highlights with you here. Of course, revenue grew by 20%—a great number.

Speaker #2: Lotteries grew by 20%, and games by 17%. On the other hand, the operating expenses increased, but with deliberate investment decisions that we are taking into growth. Mainly, the increase comes from our marketing expenses, which rose by 37%. We really put the pressure on our customer acquisition and increased here significantly.

Andrea Behrendt: Mainly, the increase comes from our marketing expenses that rose by 37%, that we really put the pressure on our customer acquisition and increased here significantly. The personal expense increase comes with the investments into our new business areas, especially. Despite these investments, EBITDA grew by 10% to €39 million. We achieved an EBITDA margin in H1 of 31.9%, well above our guided 30% target. The key message here is that we deliver strong top-line growth and increase absolute profitability while we still continue significantly investing in our future. Now let's see on the underlying operational KPIs that drive this growth. First of all, our lottery billings for H1. Lottery billings increased by 13%, and the main driver here is the larger and more active customer base.

Speaker #2: The personnel expense increase comes with the investments into our new business areas especially. But despite these investments, EBITDA grew by 10% to €39 million.

Speaker #2: And we achieved an EBITDA margin in the first half-year of 31.9%, well above our guided 30% target. The key message here is that we deliver strong top-line growth and increase absolute profitability, while we still continue significantly investing in our future.

Speaker #2: Now, let's look at the underlying operational KPIs that drive this growth. First of all, our lottery billings for H1: lottery billings increased by 13%, and the main driver here is the larger and more active customer base.

Speaker #2: Average monthly active users increased by 9%, and, as expected in such a jackpot environment, the average billings per user increased by 4%. Based on the billings growth of 13%, and in combination with the improved gross margin, our revenue increased by 20% year over year.

Andrea Behrendt: Average monthly active users increased by 9%, and as expected in such a jackpot environment, the average billings per user increased by 4%. Based on the billings growth of 13% and in combination with the improved gross margin, our revenue increased by 20% year-over-year. Our gross margin improved from 17.3% to 18.2%, and this margin improvement comes based on favorable product mix due to the jackpot environment as we have seen that in Q2, and of course, the impact of our diversification strategy in our product portfolio. Overall, really great product margins in the lottery business and a strong top-line growth. The long-term growth driver is our customer acquisition. We really focus on this, and we reach new record levels for an H1 in ZEAL. We acquired 659,000 new customers, 32% more than H1 of last year. This is huge success.

Speaker #2: Our gross margin improved from 17.3% to 18.2%. And this margin improvement comes based on a favorable product mix due to the jackpot environment, as we have seen in Q2, and of course the impact of our diversification strategy in our product portfolio.

Speaker #2: So, overall, really great product margins in the lottery business and strong top-line growth. The long-term growth driver is our customer acquisition.

Speaker #2: So, we really focus on this, and we reached new record levels for an H1 in ZEAL. We acquired 659,000 new customers, which is 32% more than the first half-year of last year.

Speaker #2: And this is a huge success. I really want to point this out. It is achieved considering the clear boundary conditions that we set for our teams regarding the marketing investments.

Andrea Behrendt: I really want to point this out. It is achieved considering our clear boundary conditions that we set our teams for the marketing investments. You see how this translates in the cost per lead. They increased only by 7%, despite this much higher volume in customer acquisition that we put in, despite rising media costs and all the tests that we are doing to target new audiences and also to support our diversification strategy. Yeah, a real success. If you compare the core brokerage business CPLs, I think that's important, we saw a CPL of EUR 44.86. Like I say, that demonstrate really a strong discipline on our side to invest in unique economics that are scalable and really generate significant growth for ZEAL's future. Now to the other operations segment in Germany, that's games.

Speaker #2: You see how this translates into the cost per lead. They increased only by 7%, despite this much higher volume in customer acquisition that we put in, despite rising media costs, and all the tests that we are doing to target new audiences and also to support our diversification strategy.

Speaker #2: So yeah, a real success. If you compare the core brokerage business, CPLs—I think that's important—we saw a CPL of €44.86. And like I say, that demonstrates really a strong discipline on our side to invest in unit economics that are scalable and really generate significant growth for ZEAL's future.

Speaker #2: Now to the other operational segment in Germany, and that's games. Our games business continues to grow, and we are broadening our games portfolio and our product features.

Andrea Behrendt: Our games business continues to grow, we are broadening our games portfolio and our product features. That really resonates with our customers as you see in these numbers. Monthly Active Users grow by 34%. As expected, through that strong growth of Monthly Active Users, this resulted in a more diversified player mix, and we see that the high roller have a smaller proportion now, and therefore the ARPU slightly declined. Overall, this increase of active users is our goal and drives the revenue growth of 17%. With that, I hand over to Stefan for some great updates on our own lottery products.

Speaker #2: And that really resonates with our customers, as you see in these numbers. Monthly active users grew by 34%. As expected, through that strong growth of monthly active users, this resulted in a more diversified player mix, and we see that the high rollers have a smaller proportion now, and therefore the APU slightly declined.

Speaker #2: Overall, this increase in active users is our goal and drives the revenue growth of 17%. And with that, I hand over to Stefan for some great updates on our own lottery products.

Speaker #1: Andrea, thank you for these exciting updates on Games and Lottery business. As you know, one of the strategic pillars of ZEAL is to diversify away from the dependency on the German lottery business, and thus we've set up social lotteries to compensate and even out that effect.

Stefan Tweraser: Andrea, thank you for these exciting updates on games and lottery business. As you know, one of the three pillars of ZEAL is to diversify away from the dependency of the German lottery business, and thus, we've set up social lotteries to compensate and even out that effect. Traumhausverlosung is one of these businesses, and it's really on track. We have the ninth raffle currently running. Already three houses have been drawn in 2026, and we've been able to thus continue scale during that H1 of the year. The house on Lake Chiemsee reached the draw after only 63 days, the shortest draw period that we can show here. It also delivers the highest customer retention rate and the highest billings per day to date. Billings have reached EUR 9.3 million, and the very important direct-to-consumer share in that business was almost 60%.

Speaker #1: Traumhaus Verlosung is one of these businesses and is really on track. We have the ninth raffle currently running. Already, three houses have been drawn in 2026, and we've been able to thus continue to scale during that first half of the year.

Speaker #1: The house on Lake Chiemsee reached the draw after only 63 days, the shortest draw period that we can show here. It also delivers the highest customer retention rate and the highest billing per day to date.

Speaker #1: Billings have reached €9.3 million, and the very important direct-to-consumer share in that business was almost 60%. Currently, the ninth raffle on Anrum is underway, demonstrating the repeatability and the growth maturity of this product.

Stefan Tweraser: Currently, the ninth raffle on Amrum is on the way, demonstrating the repeatability and the grown maturity of this product. Speaking about social lotteries, and how we create those businesses to get independent from the jackpot situation, it is important to also mention that we have successfully launched another social lottery in Germany, Traumautoverlosung. Traumautoverlosung has also been a very initial success. We had the first lottery started in April. The product expands our own lottery portfolio from green homes into premium vehicles and gives us another attractive format for customer engagement. The first draw was completed successfully with more than 217,000 tickets sold and more than EUR 2 million in billings.

Speaker #1: Speaking about social lotteries and how we create those businesses to get independent from the jackpot situation, it's important to also mention that we have successfully launched another social lottery in Germany, the Traum Auto-Verlosung.

Speaker #1: And Traum-Autoverlosung has also been a very initial success. We had the first lottery start in April. The product expands our own lottery portfolio from Dream Homes into premium vehicles and gives us another attractive format for customer engagement.

Speaker #1: The first draw was completed successfully, with more than 217,000 tickets sold and more than €2 million in billings. This early performance gives us the confidence that the potential of this business is really there to be scaled and makes us confident that our strategy with the social lotteries and new product formats really is a very solid one.

Stefan Tweraser: This early performance gives us the confidence that the potential of this business is really there to be scaled, and makes us confident that our strategy, with the social lotteries and new product formats, really is a very solid one. With that, I hand back to Andrea for digital progress and financial guidance.

Speaker #1: With that, I hand back to Andrea for strategic progress and financial guidance.

Speaker #2: Thanks, Stefan. So let's turn to our strategic progress. We made tangible progress in H1 with our three strategic categories. And we added a new one to elevate our growth ambition.

Andrea Behrendt: Thanks, Stefan. Let us turn to our strategic progress. We made tangible progress in H1 with our three strategic categories, and we added a new one to elevate our growth ambition. First, we strengthened our customer acquisition effectiveness, and you have seen that we achieved a record 659,000 new customers in H1. Secondly, we continued to scale our own lottery products. We completed three house draws in Traumhausverlosung and launched the ninth raffle already, and we successfully introduced our new product, Traumautoverlosung. Third, we continue to grow games by expanding the portfolio and achieving monthly active users increase by 34% and revenues of 17%. After the reporting period, as you already know, we added the acquisition of SevenCanyon as an important strategic milestone by giving us immediately access to the UK prize draw market and a meaningful second home market for you.

Speaker #2: First, we strengthened our customer acquisition effectiveness, and you have seen that. We achieved a record 659,000 new customers in the first half-year. Secondly, we continue to scale our own lottery products.

Speaker #2: We completed three house draws in Traumhaus Verlosung and have already launched the ninth raffle. We also successfully introduced our new product, Traum Autoverlosung. Third, we continue to grow games.

Speaker #2: By expanding the portfolio, and achieving monthly active users, increased by 34%. And revenues of 17%. And after the reporting period, as you already know, we added the acquisition of Seven Canyon as an important strategic milestone.

Speaker #2: By giving us immediate access to the UK price store market and the meaningful second home market for ZEAL. And with that, I would like to share a little bit more detail about the transactions, although some of you for sure have dialed into our update on the 9th of July.

Andrea Behrendt: With that, I would like to share a little bit more details about the transactions. Although some of you for sure have dialed into our update on 9 July, I really like to take this opportunity to give an update and share some more details that we already discussed, but I think it is the right audience. Beginning of July, we announced the acquisition of the remaining 96.5% of SevenCanyon Limited. SevenCanyon is an established, profitable, and cash-generative multi-brand platform in the UK prize draw market with the brands 7days Performance, UKCC, and Redline. This transaction really gives us immediately access to the European largest prize draw market and creates this second home, like I told you. It reduces our dependency on German jackpot environments and fits so perfectly into our diversification strategy.

Speaker #2: I would really like to take this opportunity to give an update and share some more details that we have already discussed. But I think this is the right audience.

Speaker #2: So, at the beginning of July, we announced the acquisition of the remaining 96.5% of Seven Canyon Limited. Seven Canyon is an established, profitable, and cash-generative multi-brand platform in the UK prize store market.

Speaker #2: With the brands Seven Days Performance, UKCC, and Redline. This transaction really gives us immediately access to the European largest price store market. And creates this second home, like I told you.

Speaker #2: It reduces our dependency on German jackpot environments and fits so perfectly into our diversification strategy. The cash purchase price for the remaining share was approximately £33.8 million.

Andrea Behrendt: The cash purchase price for the remaining share was approximately £33.8 million, plus an earn-out payment of £4.8 million. To finance the acquisition and also really to remain flexible with our capital return measurements, we arranged a €40 million long-term loan with Deutsche Bank for this transaction. SevenCanyon is already a scaled, profitable, and cash-generative business with an EBITDA from last year of more than £10 million. It's already built, you don't have a build risk, and we acquire a proven and profitable business. We see clear value creation opportunities in this kind of transaction with our capabilities at ZEAL with CRM, data, and marketing steering, and we also see a cross-functional transfer of expertise in houses and cars.

Speaker #2: Plus, an earn-out payment of £4.8 million. To finance the acquisition, and also to remain flexible with our capital return measurements, we arranged a €40 million long-term loan with Deutsche Bank for this transaction.

Speaker #2: Seven Canyon is already a scaled, profitable, and cash-generative business with EBITDA from last year of more than £10 million. And it's already built, so you don't have a build risk.

Speaker #2: And we acquire proven and profitable businesses. We see clear value creation opportunities in this kind of transaction with our capabilities at ZEAL, with CRM, data, and marketing steering.

Speaker #2: And we also see cross-functional transfer of expertise in houses and cars. On the other hand, we have our valuable assets of platform scalability and/or the compliance and regulatory experience that ZEAL has, that we can bring to the table.

Andrea Behrendt: On the other hand, we have our valuable assets of the platform scalability and all the compliance and regulatory experience that ZEAL has that we can bring to the table. The acquisition is expected to be EBITDA accretive for the first full consolidated year, and the purchase price allocation and the IFRS transition is still being completed. That leads me to the update of our guidance that we shared with you beginning of July. Our previous revenue guidance was €250 million to €260 million, and that does not yet include the contribution of SevenCanyon. We will update this revenue guidance once we have an exact revenue contribution under ZEAL IFRS standards finalized, and we'll give you an update there. This is regarding the technical translation of SevenCanyon's current revenue presentation into ZEAL's group reporting. We ask a little bit of patience from you.

Speaker #2: The acquisition is expected to be EBITDA accretive for the first full consolidated year. The purchase price allocation and the IFRS transition are still being completed.

Speaker #2: And with that, let me move to the update of our guidance that we shared with you at the beginning of July. Our previous revenue guidance was €250 million to €260 million.

Speaker #2: And that does not yet include the contribution of Seven Canyon. We will update this revenue guidance once we have an exact revenue contribution, under ZEAL IFRS standards, finalized.

Speaker #2: And we'll give you an update there. This is regarding the technical translation of Seven Canyon's current revenue presentation into ZEAL's group reporting. So, we ask a little bit of patience from you.

Speaker #2: On the other hand, we confirm our EBITDA guidance of €70 to €75 million, assuming a normal jackpot environment in Germany for the rest of the year.

Andrea Behrendt: On the other hand, we confirm our EBITDA guidance of €70 to €75 million, assuming a normal jackpot environment in Germany for the rest of the year. This range includes both, A, the expected positive SevenCanyon EBITDA contribution, as well as the M&A-related one-off expenses in a mid-single-digit million euro range. For Germany, we continue to plan marketing investments around €85 to €95 million if we see clear, attractive investment opportunities within our boundary conditions. Also midterm, nothing changes. We stay with our unchanged guidance of mid-teens annual revenue growth and an EBITDA margin of above 30%. Back to you, Stefan. Stefan? Otherwise, I take over.

Speaker #2: This range includes both (a) the expected positive Seven Canyon EBITDA contribution, as well as the M&A-related one-off expenses in a mid-single-digit million-euro range.

Speaker #2: For Germany, we continue to plan marketing investments around €85 to €95 million, if we see clear, attractive investment opportunities within our boundary conditions.

Speaker #2: And also, mid-term, nothing changes. We stay with our unchanged guidance of mid-teens annual revenue growth and an EBITDA margin of above 30%. And back to you, Stefan.

Speaker #2: Stefan, otherwise I take over.

Speaker #1: No, sorry. It was my connection. Andrea, thank you for giving us the deep dive into the numbers and updating our financial guidance. I'm very happy to summarize the key takeaways of this presentation.

Stefan Tweraser: No, sorry, my connection. Andrea, thank you for giving us the deep dive into the numbers and updating our financial guidance. I'm super happy to summarize the key takeaways of this presentation. First, ZEAL has achieved a record number of revenues, and we are super happy that we grew 20% up to €122 million. Second, we translated this growth into higher profitability. EBITDA has increased by 10%, and net profits rose by 12%. Third, the successful launch of Traumautoverlosung broadened our own lottery product portfolio. Fourth, the post-acquisition period of SevenCanyon gives us a meaningful presence in the UK and further diversifies our geographic footprint. We enter H2 with a very strong momentum, a broader product portfolio, and a clear path for continued profitable growth. With this, I thank you all for your attendance and give the voice to you for the Q&A.

Speaker #1: First, ZEAL has achieved a record level of revenues, and we are super happy that we grew by 20%, up to €122 million. Second, we translated this growth into higher profitability.

Speaker #1: EBITDA has increased by 10%, and net profits rose by 12%. Third, the successful launch of Traum-Autoverlosung broadened our own lottery product portfolio. And fourth, the post-acquisition period of Seven Canyon gives us a meaningful presence in the UK and further diversifies our geographic footprint.

Speaker #1: We enter the second half with very strong momentum, a broader product portfolio, and a clear path for continued profitable growth. With this, I thank you all for your attendance and hand the floor over to you for the Q&A.

Speaker #2: Yes, thank you very much for your presentation. Ladies and gentlemen, it is now your turn. We are opening the Q&A session via the audio line.

Frank Hoffmann: Yes. Thank you very much for your presentation. Ladies and gentlemen, now it is your turn. We are opening the Q&A session via audio line. Please take the Raise Your Hand button, and if you are dialing in by phone, you can press star-T9 to raise your hand and star-T6 to unmute yourself. Please make sure we can see your clear name. Introduce yourself with your full name and your institution. Mr. Tim Kruse, the stage is yours.

Speaker #2: Please take the 'Raise Your Hand' button. If you are dialing in by phone, you can press the star key (★) 9 to raise your hand, and star key (★) 6 to unmute yourself.

Speaker #2: Please make sure we can see you clearly. Name—introduce yourself with your full name and your institution. And Mr. Tim Kruse, the stage is yours.

Speaker #3: Yeah. Tim Kruse from Montenegro. Thanks for taking my question. I have two questions—the first one will be on the Traum Autoverlosung. Stefan, maybe you could— I think you didn't reach the maximum number of tickets for that lottery.

Tim Kruse: Yeah, Tim Kruse from Montega. Thanks for taking my question. Two questions. The first one will be on the Traumautoverlosung. Stefan, I think you didn't reach the maximum number of tickets for that lottery. Maybe you could elaborate if that was in line with your expectations and how you expect that to pan out in the next draws. One question to Andrea on the personnel costs, which were quite a bit lower than in Q1. Is there anything we have to factor in here in Q2? Is that the runway we should look at for the rest of the year? Thank you.

Speaker #3: Yeah. Maybe you could elaborate if that was in line with your expectations, and how you expect that to pan out in the next draws.

Speaker #3: And then one question to Andrea on the personnel cost, which were quite a bit lower than in Q1. Is there anything we have to factor in here in Q2, or is that the runway we should look at for the rest of the year?

Speaker #3: Thank you.

Speaker #1: Tim, thank you very much for your question. Happy to take the first one. Defining the maximum number of tickets, obviously, is a learning process.

Stefan Tweraser: Tim, thank you very much for your question. Happy to take the first one. Defining the maximum number of tickets, obviously, is a learning process, and we're happy that we hit the sweet spot where we still had tickets to sell, but have, at the same time, been able to create a meaningful FOMO phase to drive sell-out as much as possible. If we would have reached sell-out too early, then we would have not utilized the full potential of the market. If we would have been even further away, that would not have created the FOMO. It's really that balance that we need to find, and that's going to continue going forward for the now running first season and all seasons to follow. We are very happy with the number of tickets that we sold, also in relation to the maximum tickets that we defined.

Speaker #1: And we're happy that we hit the sweet spot where we still had tickets to sell, but have at the same time been able to create a meaningful FOMO phase to drive sell-out as much as possible.

Speaker #1: If we would have reached sell-out too early, then we would not have utilized the full potential of the market. If we would have been even further away, that would not have created the FOMO.

Speaker #1: So it's really that balance that we need to find, and that's going to continue going forward for the currently running first season and all seasons to follow.

Speaker #1: So, we are very happy with the number of tickets that we sold, also in relation to the maximum tickets that we defined.

Speaker #3: Okay. Makes sense. Thank you.

Tim Kruse: Okay. Makes sense. Thank you.

Speaker #4: Thanks, Tim. And on the personnel cost, I would recommend you take not Q2 as a baseline, but rather Q4 or Q1, because we had some special one-off effects in Q2 regarding variable bonus accruals.

Andrea Behrendt: Thanks, Tim. On the personnel costs, I would recommend you to take not Q2 as a baseline, but rather Q4 or Q1, because we had some special one-off effects in the Q2 regarding variable bonus accruals.

Speaker #3: Okay. Thank you. Understood.

Tim Kruse: Okay. Thank you. Understood.

Speaker #2: Okay, Mr. Kruse, if you don't have any follow-up questions, we will move on to the next person. And I'm holding the room for a moment.

Frank Hoffmann: Okay. Mr. Kruse, if you don't have any follow-up questions, we will move on to the next person, and I'm holding the room for a moment.

Speaker #3: Oh, that's fine. Please. Continue.

Tim Kruse: Oh, that's fine. Please continue.

Speaker #2: Okay, thank you. So, the next person in line is Jack Cummings. You should be able to speak now, Mr. Cummings.

Frank Hoffmann: Okay. Thank you. The next person in line is Jack Cummings. You should be able to speak now, Mr. Cummings.

Speaker #5: Brilliant, thank you. Jack Cummings from Berenberg. I've got a couple of questions. The first one, just on that personnel cost point: I think you grew FTEs 25% year over year and in Q2 because of the expansion into new products.

Jack Cummings: Brilliant. Thank you. Jack Cummings from Berenberg. I've got a couple of questions. The first one, just on that personnel cost point. I think you grew FTEs 25% year-over-year in Q2 because of the expansion into new products. Should we anticipate that there is more investment that needs to go into new FTEs?

Speaker #5: Should we anticipate that there is more investment that needs to go into new FTEs?

Speaker #4: I will take that. Thanks, Jack. So, we are of course looking into further expanding our offering and also pursuing geographical expansion, as you heard from Seven Canyon.

Andrea Behrendt: I will take that. Thanks, Jack. We are, of course, looking into expanding further our offering and also having the geographical expansion, as you heard from SevenCanyon. This, of course, will trigger that the team from SevenCanyon will be included in these numbers in the future. On the baseline, let's say on the core business in Germany, we don't expect any growth.

Speaker #4: So, this of course will trigger that the team from Seven Canyon will be included in these numbers in the future. On the baseline—let's say, on the core business in Germany—we don't expect any growth.

Speaker #5: Okay, understood. Thank you. And my second question is on the Dream House Raffle and Dream Car Raffle business. I think in the financial report, it looks as though that business grew revenues 52% in the first half of the year.

Jack Cummings: Okay, understood. Thank you. My second question is on the Dream House Raffle and Dream Car Raffle business. I think in the financial report, it looks as though that business grew revenues 52% in H1. How should we think about the growth rate in revenue terms in H2? Is the business contributing positively to EBITDA yet? If not, when should we expect that?

Speaker #5: How should we think about the growth rate in revenue terms in H2? And is the business contributing positively to EBITDA yet? If not, when should we expect that?

Speaker #4: I will take that. So, you have significant growth, of course, in H1 because we also launched Traum-Autoverlosung. That wasn't included in these numbers before.

Andrea Behrendt: I will take that. You have significant growth, of course, in H1 because we launched also Traumautoverlosung that wasn't included in these numbers before. We assume, of course, a scaling there. On the guidance for the social lottery area, we still assume significant double-digit growth for the future, and that should continue. Both products are still investment products based on our conscious decision to scale these products significantly. Yeah, I hope that answers your question.

Speaker #4: We assume, of course, the scaling there. On the guidance for the social lottery area, we still assume significant double-digit growth for the future, and that should continue.

Speaker #4: Both products are still investment products, based on our conscious decision to scale these products significantly. So, yeah. I hope that answers your question.

Speaker #5: Yeah, balanced question. Thank you very much. And then, just my final question: there's obviously been a change in legislation in Germany to allow for higher stakes on slot games.

Jack Cummings: Yeah, that answered the question. Thank you very much. Just my final question. There's obviously been a change in legislation in Germany to allow for higher stakes on slot games. Two questions. One, is this something you have already implemented across your business? Part two, would you expect this to drive an acceleration in games revenue growth in H2? Thank you.

Speaker #5: And two questions. One, is this something you have already implemented across your business? And part two, would you expect this to drive an acceleration in games revenue growth in H2?

Speaker #5: Thank you.

Speaker #1: So, thank you for that question, Jack. We have implemented parts of the increase, but we also try to strike a very delicate balance with player protection when it comes to our games business.

Stefan Tweraser: Thank you for that question, Jack. We have implemented parts of the increase, but we also try to strike a very delicate balance

Stefan Tweraser: Thank you for that question, Jack. We have implemented parts of the increase, but we also try to strike a very delicate balance with player protection when it comes to our games business. We take these steps very deliberately and very consciously of the impact that higher stakes will have on responsible gaming and player protection. Whilst we see and further expect an increase in gaming revenues, the main driver is, as Andrea pointed out, an increase in MAUs and a balanced growth in average billings per user will not so much depend on increased stakes to drive the games revenue.

Stefan Tweraser: With player protection when it comes to our games business. We take these steps very deliberately and very consciously of the impact that higher stakes will have on responsible gaming and player protection. Whilst we see and further expect an increase in gaming revenues, the main driver is, as Andrea pointed out, an increase in MAUs and a balanced growth in average billings per user will not so much depend on increased stakes to drive the games revenue.

Speaker #1: So, we take these steps very, very deliberately and very consciously, considering the impact that higher stakes will have on responsible gaming and player protection.

Speaker #1: So, while we see and further expect an increase in gaming revenues, the main driver is, as Andrea pointed out, an increase in MAUs and balanced growth in average billings per user.

Speaker #1: We do not so much depend on increased stakes to drive the game's revenue.

Speaker #5: Understood. Thank you very much.

Jack Cummings: Understood. Thank you very much.

Speaker #2: Thank you for your questions, Jack. And we move on to Abed Jarad. He may be able to speak now. Abed.

Frank Hoffmann: Thank you for your questions, Jack. We move on to Abed Jarad. You may be able to speak now, Abed.

Speaker #6: Hi, good morning. This is Abed from MVB Research. I have one question regarding games. Can you maybe explain why growth in monthly active users is stagnating quarter-on-quarter, at least in the last three quarters?

Abed Jarad: Hi, good morning. This is Abed from M.M.Warburg Research. I have one question regarding games. Can you maybe explain why growth in monthly active user is stagnating quarter on quarter, at least in the last three quarters? Also monetization is lagging behind. What is the explanation for this?

Speaker #6: And also, monetization is lagging behind. What is the explanation for this?

Speaker #4: I will take that. So, first of all, on the monetization, I think I explained that to you in this presentation today. So it's really about the fact that you have these early adopters who are rather games-affine and have a higher spending volume within the customer base.

Andrea Behrendt: I will take that. First of all, on the monetization, I think I explained that to you in this presentation today. It's really about that you have these early adopters who are rather games affined and have a higher spending volume within the customer base. The more we scale and grow the customer base, and actually, I have to look up the number, but over 30% our MAUs grow, you will get more standard games player compared to these high rollers. Therefore, the average revenues per user goes down. That's what we expect. That's the dynamic. We rather want to grow the overall customer base than focusing on high roller field. On the growth rates, I'm not fully understanding your question. We grow the customer base, but of course, not as quickly as possible.

Speaker #4: And the more we scale and grow the customer base—and actually, I have to look up the number—but over 30% our MAUs grow, you will get more standard games player compared to these high rollers.

Speaker #4: And therefore, the average revenues per user go down. But that's what we expect. So that's the dynamic. We would rather grow the overall customer base than focus on high rollers here.

Speaker #4: And on the growth rates, I'm not fully understanding your question. So, we grow the customer base, but of course, not as quickly as possible.

Speaker #4: I think you probably all know about the restrictions we have in the German regulation regarding, yeah, cross-selling and driving that growth. So we are very happy with the growth numbers that we are seeing.

Andrea Behrendt: I think you probably all know about the restrictions we have in the German regulation regarding cross-selling and driving that growth. We are very happy with the growth numbers that we are seeing and will accelerate here.

Speaker #4: And we'll exaggerate here.

Speaker #6: Okay, fair enough. I meant like growth quarter on quarter. So in Q4, you had €35 million. Q1, €35 million. Q2, €36 million. So quarter on quarter, it's decelerating.

Abed Jarad: Okay. Fair enough. I meant like growth quarter on quarter. In Q4, you had EUR 35 million, Q1 EUR 35, Q2 EUR 36. Quarter on quarter, it's decelerating. That's what I meant with growth in monthly active users. Yeah.

Speaker #6: That's what I meant by growth in monthly active users. Yeah.

Speaker #4: Yeah. So like I said, I think in the first phases, of course, we have the reverse: small business and growing on a big scale, percentage-wise, on the growth.

Andrea Behrendt: Yeah. Like I said, I think in the first phases, of course, we were a small business and growing on big scale percentage-wise on the growth. Now the growth is more our customer base knows that there's games. Of course, growth is slowing down quarter over quarter. We will see what new product portfolio and product features and also the stake increase will deliver here for us in the future.

Speaker #4: Now that the growth is more, our customer base knows that there are games. So of course, growth is slowing down quarter over quarter. We will see what the new product portfolio, product features, and also the stake increase will deliver for us in the future.

Speaker #6: Okay. Thank you so much. Maybe one last question regarding Seven Canyon. Have you communicated at least a comparable in terms of revenue? Like on what you are expecting and what range?

Abed Jarad: Okay. Thank you so much. Maybe one last question regarding SevenCanyon. Have you communicated at least a comparable in term of revenue, like on what you are expecting, in what range? If I'm not mistaken, it was around EUR 40 million.

Speaker #6: If I'm not mistaken, it was around €40 million.

Speaker #4: There are, exactly, there are two numbers. Maybe my team can search it out, and we will give it to you. In a minute—we shared that already in the presentation of the M&A deal, exactly.

Andrea Behrendt: Exactly. There are two numbers. Maybe my team can search it out, and we will give it to you in a minute. We shared that already in the presentation of the M&A deal exactly. There's just a question between if it's GGR or NGR view. We will share both numbers in a minute with you when we have it there. Give us a moment, please. We can continue with questions meanwhile.

Speaker #4: So there's just the question between if it's GGR or NGR view. We will share both numbers with you in a minute when we have them.

Speaker #4: Give us a moment, please. But we can continue with questions in the meantime.

Speaker #2: So, if you have any follow-up questions, Abed, this is the space to raise them now. And to everybody else—oh, yes, Abed, I see your hand is raised.

Frank Hoffmann: If you may have any follow-up questions, Abed, this is the space to place them already. To everybody else-- Oh, yeah. Abed, I see your hand is risen, and I give you the allowance to speak again.

Speaker #2: And I give you the allowance to speak again.

Speaker #6: No, sir. I just wanted to say I have no further questions. Thank you.

Abed Jarad: No, sorry. I just wanted to say I have no further questions. Thanks.

Speaker #2: Okay, thank you. And to everybody else attending the call, you are very welcome to also raise your hand if there are some questions left.

Frank Hoffmann: Okay. Thank you. To everybody else attending the call, you are very welcome to also raise your hand if there are some questions left. Which doesn't seem to be the case in that moment, and we will hold the room for a bit.

Speaker #2: Which doesn't seem to be the case at that moment. And we will hold the room for a bit.

Speaker #4: So, if there are no other questions, Abed, we will call you afterwards. We are just getting the numbers ready for you.

Andrea Behrendt: There are no other questions. Abed, we will call you afterwards. We are just getting the numbers ready for you.

Speaker #6: Sure. Thank you.

Abed Jarad: Sure. Thank you.

Speaker #2: Okay. Thank you for your questions, Abed. With no further questions, we have come to the end of the earnings call today. Thank you very much for your interest in ZEAL Network SE.

Frank Hoffmann: Yes. Thank you for your questions, Abed. With no further questions, we have come to the end of the earnings call today. Thank you very much for your interest in ZEAL Network SE. A big thank you also to you, Stefan and Andrea, for your presentation and your time. Should you, ladies and gentlemen, have any further questions at a later date, please feel free to contact Senior Investor Relations Manager, Frank Hoffmann. I wish you all a successful day around the world. Handing back over to Andrea for some closing remarks.

Speaker #2: A big thank you also to you, Stefan and Andrea, for your presentation and your time. Should you, ladies and gentlemen, have any further questions at a later date, please feel free to contact Senior Investor Relations Manager Frank Hoffmann.

Speaker #2: I wish you all a successful day around the world, and I am handing back over to Andrea for some closing remarks.

Speaker #1: Yeah.

Speaker #4: Exciting H1. Looking forward to a strong second half of the year. So, thank you very much for your questions and for joining us this morning.

Andrea Behrendt: Yeah. Exciting H1. Looking forward for a strong H2. Thank you a lot for your questions and for joining us this morning. We really appreciate your time and your interest in ZEAL. Speak soon with great new results. Thanks a lot.

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Half Year 2026 ZEAL Network SE Earnings Call

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