In a move that marks the end of an era for Swedish land-based casinos, the government has recently proposed the closure of Casino Cosmopol, a subsidiary of state-owned operator Svenska Spel. The memorandum, filed on 7th May 2024, states that Casino Cosmopol “no longer fulfils its purpose” and highlights the ongoing challenges for the business to reach profitability.

If the measure passes, Svenska Spel’s licence for operating land-based casinos would be amended, requiring the company to shut down its only remaining casino venue in Stockholm by 1 January 2026. This closure would affect approximately 200 jobs. However, the government does not anticipate the proposed closure to have any significant impact on illegal gambling in Sweden.

Svenska Spel has acknowledged the struggles faced by Casino Cosmopol and shares the government’s assessment of the reasons for closure. The company notes the lack of opportunity to reach profitability as visitor numbers continue to decline, with more people opting to gamble online.

Svenska Spel once operated four casino locations in Sweden. However, the changing landscape of the gambling industry has led to a series of closures. The first casino to close was the one in Sundsvall in 2020. More recently, the company announced the permanent closure of its casinos in Gothenburg and Malmö due to limited profitability.

Svenska Spel CEO Erik Strand commented on the situation, stating, “The movement from gambling in land-based casinos to gambling online accelerated after the reregulation of the gambling market in 2019 and the subsequent pandemic, when Casino Cosmopol remained closed. We share the assessment that it is no longer possible to run Casino Cosmopol profitably.”

Recent financial results published by Svenska Spel clearly demonstrate the declining performance of Casino Cosmopol compared to its other businesses. In 2023, the Casino Cosmopol and Vegas arm posted a 12.0 percent drop in revenue to SEK942m (£69.3m/€80.7 million/$86.9 million), attributed to a decrease in casino visitors as online casino gaming gains popularity.

In contrast, Svenska Spel reported growth in other sectors. Revenue from the Tur lottery division climbed 0.6% to SEK4.92bn, while revenue from Sport & Casino was up 4.6 percent to SEK2.17 billion. The online sector saw revenue grow 7.2 percent to SEK4.20 billion, while casino revenue fell 11.4 percent to SEK473million.

In addition to the financial struggles, Casino Cosmopol has faced regulatory issues in recent months. In December, the casino was fined SEK2m for anti-money laundering failings after a probe by Swedish regulator Spelinspektionen. Svenska Spel was also warned over the matter.

As the proposed closure of Casino Cosmopol marks the end of an era for Swedish land-based casinos, it also highlights the ongoing shift in the gambling industry towards online platforms. While the closure will undoubtedly have an impact on the employees and the local economy, it is a reflection of the changing preferences of gamblers and the challenges faced by traditional brick-and-mortar casinos in an increasingly digital world.

As the industry continues to evolve, it will be interesting to see how operators and regulators adapt to the changing landscape and address the challenges and opportunities that come with the growth of online gambling.

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