CSR report and Annual report 2013

Steady performance in tough times

Determined development work in Veikkaus continued in 2013. In particular, we focused on our digital business, cost-efficiency, and responsibility and reliability across the board. We expanded our product range with new games, and upgraded existing ones. Sales channel improvements included reforms in online stores and a more extensive, digital retailer network. New tools were introduced to drive our responsibility efforts; as a result, we were able to grow the proportion of registered gaming. Systematic steps were taken to increase cost-awareness throughout our operations.

In product development, Veikkaus concentrated on digital business, and will continue to do so this year. The year under review began with the introduction of a new mobile channel. Throughout the year, we continued to work on our online service, to make it more compatible with the various terminals used by our customers, as well as their individual user styles and expectations. In the autumn, we extended the opening hours of our online store to 24 hours a day, in order to offer a secure and legal alternative to the countless unsupervised gaming sites available on the Internet.

The introduction of the mobile channel and improvements in our online service have resulted in an increase in registered gaming, which was one of the key objectives for the year under review. Registered gaming accounted for as much as 53.7 per cent of Veikkaus' total sales at the end of 2013. Registered gaming provides the best consumer protection and customer benefits to players, while providing a responsible gaming company with the opportunity to avoid the various risks and problems associated with gaming.

We expanded our retailer network to include points of sale near large customer flows and in small grocery stores. Digital marketing and communication are increasingly used in retailer-operated points of sale. This contributes to the ecological sustainability of our operations. By running an extensive POS network we can offer all Finns an equal opportunity to play games offered by Veikkaus, regardless of the customer’s place of residence.

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In November, the European Commission issued a decision clearly approving the Finnish gaming system. According to the decision, Finland's gaming legislation meets the requirements of EU law, and is applied systematically and consistently. The Commission's decision places Veikkaus firmly in a position in which it can offer Finns their favourite games in a responsible and secure manner. Each euro generated from Veikkaus' games is used to benefit each and every Finnish citizen. In per capita terms, Veikkaus generates the largest income of this type in Europe.

The current economic conditions present a challenge in terms of Veikkaus' business environment. During the year under review, declining consumer purchasing power and consumer demand affected sales, particularly at retailer points of sale. However, despite the challenging economic conditions, we were able to increase the amount of revenue we return to society. This achievement was the result of enhanced cost awareness and active development work.

In 2014, we will continue to pursue our long-term objectives and to develop Veikkaus' products and services based on a customer-oriented mindset. We aim to safeguard a stable return for the Finnish arts, sports, science and youth work. We are seeking moderate and responsible growth, while striving to generate value for Finnish society during 2014 and in the years thereafter.

I would like to extend my warmest thanks to all Veikkaus personnel and our business partners for their hard work and commitment. A special thanks to each and every Veikkaus customer, who, by playing Veikkaus games, has supported a good cause.

I hope that many Finns are entertained by Veikkaus’ reliable, high-quality games and enjoy the benefits they generate for society.

 

Juha Koponen

CEO