Month: September 2021

Leeds-based BlueClaw offers both SEO and pay-per-click (PPC)-based affiliation, as well as digital PR and content marketing services. XLMedia said that BlueClaw would provide “a UK hub for XLMedia’s European Sports business”.

XLMedia will pay £600,000 when the deal closes and another £600,000 at the end of the first year of the deal. A further £600,000 may then also be paid, depending on certain performance targets.

In the 12 months to 30 November 2021, BlueClaw had revenues of £1.1m and earnings before interest, tax, depreciation and amortisation (EBITDA) of £100,000, though XLMedia noted that the novel coronavirus (Covid-19) pandemic had a notable impact on these results. 

For the 12 months to 30 November 2022 the business expects revenue of £1.6m and EBITDA of £400,000.

Stuart Simms, chief executive of XLMedia, said he was confident BlueClaw was a good fit as the businesses have worked together for more than a year.

“We are delighted to announce the acquisition of BlueClaw, which will see us bring this hugely talented team into the XLM family,” he said. “Having worked closely with them for over 12 months, we’ve been able to experience first-hand the quality of their work and are hugely excited at the prospect of BlueClaw’s expertise being rolled out across our broader portfolio.

“Today’s announcement further demonstrates our commitment to rebalancing the business with the correct skills, people and technologies in order to create a sustainable platform capable of delivering long-term growth.”

XLMedia also announced that its revenue for the first half of 2021 was up 16.2% to $32.2m.

For the first time, North America was XL’s leading market, bringing in $13.5m, up 150.0%. This helped offset a 21.9% decline in revenue from Scandinavia, to $8.9m and a slight dip in the rest of Europe, where revenue was $7.8m.

Revenue from Oceania was down 24.0% to $352,000 while revenue from the rest of the world fell 36.3% to $35,000. The remaining $1.6m came from unidentified locations.

After costs of revenue of $14.0m, up 25.6%, XLMedia’s gross profit was $18.3m – 10.2% more than in H1 of 2020.

The affiliate then paid $15.7m in general and administrative costs – up 20.7%, while research and development costs ticked up to $1.2m and sales and marketing expenses declined 12.6% to $1.9m.

As a result, the business slipped to an operating loss of $573,000 – having made $279,000 in operating profit the year prior.

After net finance-related income of $35,000 and $99,000 in other income, XLMedia made a pre-tax loss of $439,000, compared to 2020’s $171,000 pre-tax profit.

After tax benefits, the affiliate made an $82,000 loss, compared to a $99,000 profit in H1 of 2020.

Simms said the business worked to continue to grow its presence in H1.

“We continued to make further organisational progress in the first six months of the year, as we expanded our portfolio of high-quality branded sites, whilst also laying the foundations to improve the use of our first party data,” he said. “The combined positive impact resulted in a strengthened US Sports division, increase of regulated market and new money revenue, as well as the development of a significantly improved data architecture and infrastructure to serve the Group’s long-term ambitions.”

He added that acquisitions would continue at a faster pace during the second half of the year.

“During 2021, I have challenged the business to accelerate the acquisition of new assets, reorganise and re-build our capability and to develop a new data and technology platform,” he said. “I am proud of the team and our achievements, and have confidence that the necessary changes will result in improved focus, productivity and growth in H2 2022 and beyond.”

Earlier this month, XLMedia announced that it had acquired online US college football news publisher Saturday Football for a total consideration of $23.0m.

Republic Act 11590 imposes a 5% tax on the gross gaming revenue of online gaming operators – who primarily target the Chinese market – while foreigners employed in online casinos and their service providers are now required to pay 25% income tax.

The legislation, also known as An Act Taxing POGOs, has been passed as part of the government’s efforts to regulate all forms of legal gambling and prohibit illegal gambling operations, according to Duterte’s spokesperson Harry Roque.

The law, first proposed in 2019, amends the National Internal Revenue Code (NIRC) to more efficiently collect taxes from POGOs and imposes more taxes aside from the franchise tax levied on their operations.

Under RA 11590, all offshore gaming licensees, regardless of whether Philippines or foreign-based are considered doing business in the Philippines, and must pay a 5% gaming tax on the gross gaming revenue or receipts derived from their gaming operations. The non-gaming revenues of Philippine-based offshore gaming licensees will also be subject to an income tax equivalent to 25% of the taxable income derived during each taxable year from all sourced within and without the country.

Foreign nationals employed by offshore gaming licensees and service providers will be subjected to a 25% withholding tax. It provides a minimum final withholding tax due of PHP12,500 for any taxable month.

According to RA 11590, foreign POGO employees, regardless of nature of employment, must have a tax identification number. All offshore gaming licensees and providers who employ a foreign national will pay a fine of PHP20,000 for every foreign national sans tax identification number. Their primary and other licenses obtained from government agencies might also be revoked.

Under RA 11590, around 60% of the total revenue collected from POGOS will be allocated for the implementation of universal health care. Around 20% of the revenue will be allotted for other health programmes, with the remainder dedicated to other development schemes.

The government is expected to collect PHP28.7bn ($571.0m/€487.4m/£418.3m) in revenues from POGOs in 2020 and PHP32bn in 2022, following the signing of RA 11590.

The limits will come into effect from 24 September.

The player-set loss limits can be set at the casino and will be handled by the shift manager at the given Casino Helsinki site.

A block button has also been added to the slot machines to prevent gameplay, identified by a red color on the screen of each slot card reader.

Gambling monopoly Veikkaus extended loss limits to its physical slot machines back in August, in addition to mandatory ID requirements introduced earlier this year.

These measures forced players to properly authenticate themselves before playing slots, before selecting a loss limit before gameplay starts.

The operator also brought in €500 loss limits for online play. These limits were initially temporary but the operator announced in June that they would become permanent.

Casino Helsinki general manager Tiina Siltanen said: “The provision of gaming management tools is part of Veikkaus’ key responsibility measures aimed at preventing gambling harm. 

“The package we offer is unique in the European casino environment. It is great that Casino Helsinki and the future Casino Tampere are pioneers in building a responsible casino world.”

Through data collected from player IDs, Veikkaus earlier this month revealed that approximately 7% of its players generated 50% of its revenue in 2021 so far.

The proposals to build the resortfollow the Indiana Gaming Commission’s request for proposals for Indiana’s open casino license for Vigo County.

While the regulator did not provide details of the bids, Churchill Downs Incorporated did reveal more information about its proposed Queen of Terre Hatue resort.

The Queen of Terre Haute resort will feature a luxury hotel and a TwinSpires sportsbook, in addition to 1000 slot machines, 50 table games and food and drink locations.

CDI chief executive Bill Carstanjen said: “Churchill Downs has a 147-year track record of offering extraordinary entertainment experiences and has significant expertise developing premier casino and gaming properties throughout the United States.”

Read the full story on iGB North America.

Casino revenue was the biggest contributor to the overall total, with the €99.9m raised accounting for 46.3% of the overall total. Casino revenue was also up 6.7% from last year, and up 0.4% from last quarter.

The €92.0m of betting revenue – a 35.0% increase from last year – made up 45.6% of the total, while 9.4% came from €20.3m of poker revenue.

Players deposited a total of €675.6m, up by 41.8% from 2020. Player withdrawals also increased significantly, rising 70.8% to €477.2m.

Marketing expenses totaled €128.4m, down 13.4% from the first quarter of 2021. Affiliation expenses were €10.0m, promotions were €49.2m, and advertising costs came to €61.6m. A further €7.6m was spent on sponsorships.

On average there were 991,196 active gaming accounts per month during the second quarter -up 54.2% from last year – with 231,167 new accounts.

In a two-count complaint filed by the Nevada Gambling Control Board (NGCB), the regulator said the businesses accepted approximately 348 wagers via the Stadium Live mobile sports betting platform for events whose outcomes had already been determined.

System errors that allowed a total of 181 bets to be placed erroneously were identified in both 2018 and 2019. However, despite repeated warnings from NGCB, 167 further cases were still able to occur between March and May of this year.

To read the full article, visit iGB North America.

STS, the leading betting operator in the Polish market, will utilise Genius Sports’ LiveData and LiveTrading solutions, delivering official data and live pricing across thousands of sporting events per year.

The operator added that the partnership includes Genius Sports’ portfolio of premium official data rights, including popular events in Poland such as Euroleague Basketball, the Ekstraklasa top-tier football league and Polish Basketball League.

“STS is not only the largest Polish bookmaker, but we are also one of the biggest technology and data-driven companies in the iGaming industry,” said Mateusz Juroszek, chief executive of STS.

“One of our advantages is our own technology and the ability to easily implement the most attractive tools from the best suppliers. We are constantly improving the customer journey at STS, and in-play odds, powered by Genius Sports will be a pillar of this.”

A Stowarzyszenie Graj Legalnie survey published earlier this year reported that STS had a 46% share of the Polish market in 2020 with revenue of PLN3.319bn ($837.0m/€714.5m/£613.1m). STS has 440 betting shops in Poland and four offices located in Katowice, Warsaw, Prague and Malta.

“Partnering with STS, the leading operator in the Polish betting market is further validation of our global commitment to official sports data,” said James McKiernan, head of commercial, EMEA at Genius Sports.

“With access to the fastest, most accurate and reliable live betting content, STS will deliver Polish players with best in-class betting experiences on the biggest sports leagues.”

By Josh Walfish

Ohio State Senator Kirk Schuring introduced the bill that would greatly expand sports betting in the state, with 40 licenses being available for an initial $1 million fee and $500,000 fees in the second and third years of operation.

Half of the available licences will be available for casinos and other establishments that can already legally take a bet in Ohio. The other half would be aimed at the sportsbooks that would need to build physical locations in Ohio once sports gambling laws are passed to take advantage of the new online sports gambling laws. 

Two executives from the publicly traded Esports Entertainment Group testified before the Ohio Senate in relation to this bill. During their testimony, EEG’s chief financial officer Dan Marks and vice president of strategy Jeff Cohen mentioned the company’s recent partnership with the Cleveland Cavaliers announced last month. The duo also talked about the company’s plans to build several Helix Centers in the state to promote esports and bring their Vie esports betting platform to the state.

What this means for the United States

After Cohen and Marks testified in Columbus, EEG’s CEO Grant Johnson sent out a statement, which said in part, “We believe Ohio can form a model for innovation and investment in esports that other states will follow.” Indeed that is the hope for EEG, whose main focus is on growing the esports community and the world of professional video gaming. It is putting a lot of money into Ohio as the test case for the rest of the United States when it comes to adding esports options in the country.

Ohio’s bill is also the first to allow licence holders to have uncapped online sportsbook partnerships. That means that those holding licences in Ohio can partner with as many online sportsbooks as they desire, which would open up the market for online sports betting in the state and create more competition. This would allow more retail shopping of odds from a wider variety of betting entities.

The one potential issue for the esports industry is the bill would prohibit wagering on events featuring participants under the age of 18. The gaming industry is on the younger end, though none of the major teams in esports employ minors. It shouldn’t have a large effect on the betting scene but it is something to keep an eye on as the bill progresses through the Ohio legislature.

What’s coming next?

This bill still has a long way to go until it is implemented in Ohio. EEG’s testimony came in front of the Ohio Senate’s Select Committee on Gaming, so the bill not only has to get out of the subcommittee but then must also pass the full Senate and full state house before being signed by Governor Mike DeWine. Once signed, it will likely not take effect until 2022 at the earliest as sportsbooks begin trying to purchase licenses and Ohio builds the infrastructure required to handle the increase in gambling activities. 

The battle of regulation for the sports betting industry in Ohio will be one of the major sticking points after it derailed the same bill last year. As the bill currently stands, the Casino Control Commission would oversee the sportsbooks and not the lottery, but the bill would allow the lottery to create $20 betting pools with winnings divided from losing wagers similar to the existing games from the Ohio Lottery. The uncapped partnerships are another hot-button topic that will surely be debated many times before the bill is passed.

Many eyes throughout the country will be on Ohio as these debates continue because the state’s eventual bill will likely be a template for future legislation. There are many unique ideas that Ohio is presenting, thanks in some small part of EEG’s commitment to the area, and any success Ohio has will be copied by the other states as sports gambling grows in the United States.

The failings in question occurred between October 2019 and November 2020, and the Commission has also issued the operator with a formal warning.

With regards to social responsibility, issues included failure to flag customers frequently changing deposit limits as harmful, lack of adequate financial and affordability assessments for players, and insufficient interaction with at-risk players.

The anti-money laundering failings consisted of inadequate analysis of customer bank statements to verify an address, not restricting customer accounts following a source of funds request and allowing customers to register third-party debit cards to their account.

EU Lotto was also said to have relied too heavily on “ineffective” threshold triggers for financial risk. The Commission plans to launch a consultation on industry-wide triggers in the near future. 

Helen Venn, Commission executive director, said: “This case, like other recent enforcement action, was the result of planned compliance activity. All operators should be very aware that we will not hesitate to take firm action against those who fail to meet the high standards we expect for consumers in Britain.”

The Commission recently fined Rank-owned Kittybingo and Regalwins operator Daub Alderney £5.8m for similar failings in social responsibility and anti-money laundering.

Lottoland CEO Nigel Birrell said: “Lottoland is fully committed to ensuring the highest standards of compliance, including its anti-money laundering and social responsibility obligations in all of the jurisdictions in which it operates.

“The Gambling Commission fine was related to legacy issues around some of our compliance controls which have now been addressed. Lottoland  has extensive compliance measures in place and we are confident that our current policies and processes meet all relevant standards. 

“Remedial action taken included significantly increased investment in our compliance function, more than doubling headcount, alongside a host of other initiatives including bringing in third party support, enhancing training and a review of key policies. In addition, we  recently committed to building our individual processes into an automated system to improve the system even further. ”

Beijing AGTech GOT Technology Co will provide its services to lottery operators in Henan, Hebei, Zhejiang, Jilin, Hunan, Shanxi, Inner Mongolia Autonomous Region and Guangdong.

The announcement comes just two months after AGTech was nominated to supply lottery terminals to six other Chinese provincial sports lotteries, including Hubei, Sichuan and Shandong.

Commenting on the tender successes, the group said: “AGTech GOT has won many tenders in various provinces, municipalities and autonomous region across China this year, which reaffirmed the hardware division’s continued dedication to and leading position in China’s sports lottery terminal market, demonstrating the continued effort and competitiveness of AGTech’s lottery terminals.

“AGTech will continue to enhance product innovation, ensure safety and R&D compliance, and contribute to the overall healthy development of China’s lottery market.”

AGTech recorded revenue figures of HK$77.9m (£7.2m/€8.5m/$10.0m) for the first half of 2021, representing a 77.6% increase on the same period last year. HK$68.7m of the revenue came from the mainland People’s Republic of China, while the remaining HK$9.2m was raised in Hong Kong.

In its April results, Sports Lottery sales totalled CNY17.93bn (£2.0bn/€2.3bn/$2.7bn), a 56.3% year-on-year rise.