Month: February 2022

Zebet, Zeturf, Slot Vibe, Arlekin Casino, Johnnie Kash Kings, Lucky Star, Horus Casino, 21 Dukes, Tangiers Casino, 7 Reels, Winward Casino and Thebes Casino were all found to have breached Australia’s Interactive Gambling Act 2001, following a series of investigations by ACMA.

In response, ACMA requested that Australian internet service providers (ISPs) block access to each of the websites.

Since the ACMA made its first website blocking request in November 2019, a total of 399 illegal sites have been blocked in the country.

In addition, the Authority said that more than 160 illegal operators have pulled out of the Australian market since the ACMA began enforcing illegal offshore gambling rules in 2017.

“Website blocking provides a valuable opportunity to alert the public to illegal gambling services through the messaging that appears when there is an attempt to access the site,” ACMA said.

The latest blocking orders come after ACMA last week published a new report that showed more than 10% of Australians bet online at least once during the six months to June 2021.

The majority of these players gambled online, but 5% of online players admitted to using an offshore, unlicensed website or app in the six-month period. 

Some 11% players aged 18-34 did so, while the figure was 2% for those 45 and over. A further 6% said they did not know where their service was located, while 89% only gambled with licensed operators.

Also this month, Sportsbet, the Australian brand of Flutter Entertainment, was ordered to pay out AU$3.7m (£2.0m/€243m/$2.7m) for spamming customers with text and email marketing.

The figure comprised an infringement notice of AU$2.5m – a record sum – and the operator committed to refunding customers AU$1.2m.

The settlement was agreed following an investigation by ACMA, which found that Sportsbet sent more than 150,000 marketing text messages and emails to over 37,000 consumers who had tried to unsubscribe.

Total revenue for the 12 months through to 31 December 2021 reached €136.1m, up from $106.0m in the previous year.

Search revenue accounted for €129.0m of total revenue, up 34.5% from 2020, though paid revenue declined 16.5% year-on-year to $7.1m. Following the sales of the Hammerstone business in Q4 2020, subscription revenue was zero, compared to €1.6m in 2020.

Revenue from cost-per-acquisition affiliation accounted for 54% of all revenue for the year, while 37% came from revenue-sharing arrangements, and the remaining 9% was generated from fixed-fee models.

Breaking down this performance by business segment, casino remained Catena’s primary source of revenue, with operations here generating €86.2m in revenue, up 23.9% year-on-year.

This, Catena said, was helped by its ongoing expansion within the North American market, as well as growth in Japan, but progress was slightly hampered by the introduction of new regulations in Germany and the Netherlands during the year, with revenue down in these markets.

Sports betting revenue was also up 51.0% to €46.2m, again helped by growth within North America. Catena highlighted the launch of legal sports wagering in Michigan, Virginia and Arizona in particular, adding that the opening of regulated markets in both New York and Louisiana shortly after the year-end will support further growth.

Financial trading revenue, however, fell 36.2% year-on-year to €3.7m due to the sale of the Hammerstone business and a temporary slowdown related to changes in Catena’s partner portfolio. The affiliate said revenue in this area is expected to normalise in Q1 2022.

“We continue to position ourselves for the global trend towards betting and casino regulation,” said Michael Daly, who became chief executive of Catena in March 2021. “The strict restrictions imposed on online gaming in Germany in the last year have been a challenging experience for us and the industry as a whole. 

“But our intention is to learn from the process so we are better positioned in countries that may regulate in the future. Our business model thrives in regulated markets, and we embrace regulation as a way to ensure a level playing field and transparency for all.”

However, total operating expenses increased 96.6% to €132.7m. Staff costs hiked 35.6% to €32.0m, partly due to a short-term incentive programme, while direct costs climbed 53.5% to €15.5m.

Depreciation and amortisation expenses were 7.8% lower at €10.7m, but general operating costs increased 10.1% to €25.1m, while Catena also noted a €49.4m impairment charge on its intangible assets in Q3 relating to German and French sport assets.

Taking out certain expenses and adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) was 32.3% higher at €68.8m for the year.

However, after including €4.6m in interest expenses, €1.7m in losses on financial liability and equity instruments and €2.9m in other finance costs, this left a pre-tax loss of €5.8m, compared to a €14.8m profit at the same point in 2020.

Catena paid €1.4m in income tax, leaving an initial net loss of €7.2m, in contrast to a €12.5m profit in 2020.

After also including €986,000 in negative impact from foreign currency translations, as well as €4.5m in interest payable on hybrid securities, this left a comprehensive net loss of €12.7, compared to a €11.1m in the previous year.

Turning to the fourth quarter and revenue for the three months to 31 December was 19.9% higher at €31.9m. 

This was split €30.5m for search revenue and €1.4m in paid revenue, while casino revenue was €19.9m, sports betting €11.1m and financial trading €876,000.

Operating costs were 39.8% higher at €23.2m, while after including €1.2m in interest costs and €1.2m in other finance costs, only partly offset by €275,000 in gains on financial liability and equity instruments, this left a pre-tax profit of €6.6m, down 22.4% year-on-year.

Catena also noted that adjusted EBITDA for the quarter amounted to €12.8m, which was 4.1% more than in the corresponding quarter in 2020.

The affiliate paid €812,000 in income tax in Q4, leaving an initial net profit of €5.8m, down 24.7% from €7.7m in the previous year.

However, after accounting a €161,000 negative impact from foreign currency translations and €1.1m in interest payable on hybrid securities, this meant Catena ended the quarter with a comprehensive net loss of €1.2m, only marginally wider than the €1.3m net loss posted in Q4 of 2020.

“Investments were made across the group in personnel and technology to support growth and to further improve the foundational architecture of our brands, so we are fully equipped to deliver profitable double-digit growth today and for years to come,” Daly said.

“This spending on our future long-term success will continue through 2022.”

Regional revenue made up $5.53bn of the total, an increase of 108.1%. Las Vegas revenue totaled $3.40bn, up by $2.65bn, while revenue from Caesars Digital rose $242m year-on-year to $337m, thanks mostly to the acquisition of William Hill and rebranding of its betting product. Managed and branded revenue hit $278m, a rise of 159.8%, and corporate and other costs fell by $6m to $9m.

Caesars also included the pre-consolidation revenue for its Horseshoe Baltimore location and the pre-acquisition revenue in relation to its $2.9bn acquisition of William Hill US in April.

Read the full story on iGB North America.

Total revenue for the six months to 31 December 2021 was $30.9m, up from $2.6m in the same period in the previous year as the group felt the impact of its acquisition of Bethard in July 2021.

Other major highlights during the period included the launch of the new Fiksukasino.com ‘pay-and-play’ casino brand in Finland, while the group also entered a partnership with Game Fund Partners to become part of its venture capital arm, and a planned $300m game fund. 

Esports Entertainment completed the migration of its SportNation.com and Vie.bet online gaming sites to its own Idefix platform, while it also announced the launch of Omega, a new turnkey B2B solution under the ggCircuit brand that enables businesses to offer esports and other gaming options using an arcade model.

The business also grew its commercial presence by entering into partnerships with National Football League (NFL) franchises the Indianapolis Colts and the Tampa Bay Buccaneers.

In the period immediately after the half, the group received approval from the New Jersey Division of Gaming Enforcement to begin accepting bets in the state and has since rolled out its VIE.gg platform. In addition, Stuart Tilly was last month appointed chief operating officer.

Looking at spending during the first half, total operating expenses were $20.6m, more than double the $9.6m spent in the corresponding period in the previous year. 

General and administrative costs were the main outgoing in H1 at $24.3m, while sales and marketing expenses reached $14.3m cost of revenue totalled $13.0m. 

This meant adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) came in at a loss of $11.1m, wider than the loss of $6.4m posted at the end of H1 2021.

In terms of other costs, the group noted a $28.5m loss on the extinguishment of senior convertible note, as well as a $6.0m loss on loss on the conversion of senior convertible note, a $1.5m loss related to change of fair value of derivative liability and $1.4m in other loss.

While this was slightly offset by $20.5m in profit from change in fair value of warrant liability and $1.9m from the change in fair value of contingent consideration, this left a pre-tax loss of $40.4m, compared to $9.1m in the previous year.

The group received $5.5m in tax benefits, which lessened initial net loss to $34.9m. After also including two additional costs of $100,314 and $35,073 related to Series A cumulative redeemable convertible preferred stock, this meant total net loss was $35.0m, compared to $9.1m in FY 2021.

Looking at the second quarter and revenue in the three months to 31 December amounted to $14.5m, up 504.2% from $2.4m in the previous year.

Operating expenses jumped 224.4% to $26.6m – meaning adjusted EBITDA loss widened from $3.8m to $6.8m – while after including $27.8m in net other costs, this left a pre-tax loss of $39.8m, compared to $7.3m in 2021. 

The group received $5.5m in income tax benefit which meant, after also including the costs related to Series A cumulative redeemable convertible preferred stock this resulted in a net loss of $34.5m, wider than the $7.3m posted in the previous year.

“Our fiscal second quarter results reflect a variety of challenges largely outside of our control, which together drove our first quarter over quarter revenue decline in more than a year,” Esports Entertainment chief executive Grant Johnson said. 

“First, a significant change in the Netherlands regulatory environment led us to make the strategic decision to exit the country’s igaming and online sports betting market at the start of the quarter. 

“Second, our online sportsbook business in Europe experienced historically low hold which, while in-line with the broader European and US market, resulted in a material decline in sportsbook revenue. 

“Third, the ongoing issues with the global pandemic and rise of the Omicron variant during the latter part of the quarter impacted our esports business, including the delay of our LANDuel launch and the opening of our Helix esports centre in California.

“Looking ahead, I believe our future is exceedingly bright as our newest products and the underlying strength of our European-based igaming and online sports betting business position us well to benefit from the organic growth potential inherent in our two targeted entertainment verticals, igaming and esports.”

Total revenue for the six months through to 31 December 2021 amounted to AU$52.8m (£28.0m/€33.6m/US$38.0m), up 29.1% from $40.9m in the corresponding period in the previous year.

Retail lottery remained Jumbo’s primary source of revenue, with this segment generating $46.7m during the half, up 23.6% year-on-year. This, Jumbo said, was due to higher player activity on the back of increased large jackpot activity.

SaaS revenue climbed by 69.1% to $2.4m as a result of scaling up current customers within the Australian market, as well as having six full months of Western Australia’s Lotterywest, having signed a long-term agreement with the lottery at the end of 2020.

Remaining revenue came from managed services, with revenue rising 40.8% year-on-year to $2.1m. The main contribution here came from the Gatherwell UK lottery business.

Jumbo also noted that total transaction value for the business, comprising the gross amount received from the sale of goods and services rendered in the half, increased by 4.1% from $232.8m to $327.9m.

Key events during the period included the delay of Jumbo’s planned acquisition of Canadian lottery management provider Stride Management, with this now not take place until mid-2022 due to an “extensive” regulatory approval process. Jumbo initially hoped the deal would go through before the end of 2021.

Also in H1, Jumbo appointed Nigel Atkinson as UK general manager as part of its strategy to expand its presence in the UK charity lotteries market.

After the end of the period, Jumbo agreed a deal to acquire UK external lottery manager and digital payments business StarVale Group, via newly incorporated, wholly owned entity Jumbo Interactive UK.

Jumbo will pay an initial $32.1m take ownership of 100% of the business, while the deal also includes up to $8.5m in deferred payments, which will be payable subject to StarVale achieving certain earnings targets. Jumbo hopes to complete the deal before the end of its 2021-22 financial year.

“We are very pleased with the growth that we have achieved this half, across all our operating segments, and the positive momentum across the business,” Jumbo founder and chief executive Mike Veverka said. 

“Lottery Retailing continues to perform exceptionally well, underpinned by the improved jackpot cycle and our focus on player engagement and retention. Our SaaS and managed services segments continue to demonstrate good organic growth, with all our Australian SaaS clients contributing on a full run-rate basis.”

Looking at costs for the six months and spending was higher across a number of areas, with administration expenses climbing 11.8% to $17.1m and marketing spent 80.8% to $4.7m.

However, revenue growth meant pre-tax profit was 25.1% higher at $23.9m, while earnings before interest, tax, depreciation and amortisation (EBITDA) also increased 22.3% to $28.2m.

Jumbo paid $7.5m in income tax, leaving a net profit of $16.4m, an increase of 24.7% from $13.2m in the previous year.

After also including a negative effect of $295,000 in foreign currency translation differences, this meant net profit attributable to the owners of Jumbo reached $16.1m, up 22.9% year-on-year.

“We are successfully executing on our strategy and planning is underway to ensure we efficiently and effectively integrate the Stride and StarVale acquisitions post completion,” Veverka said. “The global lottery industry is in the midst of a digital change and our Powered By Jumbo software platform will be key to supporting lotteries through this change. 

“Our balance sheet remains strong and when combined with our new debt facility, provides additional headroom for further strategic growth.”

As part of an agreement among all parliamentary parties, the new rules are aimed at making it easier for voluntary associations to hold non-profit lotteries or bingo games where money is collected for the association itself or another good cause.

The updated regulations remove a previous condition that taxed winnings from non-profit lottery games.

“The agreement is first and foremost a helping hand to the many voluntary associations around Denmark, who think that bingo and other lotteries are a good and cosy way to raise some money for a good cause,” Denmark’s Minister of Taxation Jeppe Bruus said.

“The rules become simpler and taxes on winnings are removed. With the agreement, we do away with a number of outdated rules that were a nuisance to many associations and open up a number of new opportunities and remove cumbersome requirements.”

Meanwhile, the government has announced a number of new measures related to match-fixing, including a requirement for licensed betting operators to report signs and suspicions of sports corruption.

Spillemyndigheden will now assume control of anti-match-fixing efforts from Anti-Doping Denmark.

In addition, Spillemyndigheden will be handed new powers to issue injunctions and other measures if an operator breaches national law. Previously, the regulator was required to involve the police in all matters, even in the case of minor offences. 

“Match-fixing is a serious problem because it threatens to destroy the integrity of the sport,” Bruus said. “We have seen extensive examples of this around Europe – in some cases with criminal ringleaders. 

“The game providers are already making an effort today, but now we are tightening the requirements for them further, so that they become even more active participants in the fight against match-fixing.”

Revenue for the six months through to 30 November amounted to $6.8m, which was down from $7.4m in the corresponding period in the 2021 financial year, while the amount bet by customers also fell 12.3% to $39.8m.

Webis put this drop down to a number of reasons, primarily that 2020 and the early months of 2021 were a unique period for the business and many other online gaming operations due to restrictions imposed to slow the spread of novel coronavirus (Covid-19).

For almost the entire period last year, Webis operated with either zero or highly restricted attendance at the key racetracks with which it does business. Webis said while this made its own track harder to operate, it did help its online and mobile platforms as players continued to wager, albeit on a more interactive basis. 

For the most recent six-month period, these trends have changed slightly, with increased competition for the leisure dollar and certain increases in our cost base, as consumers were able to return to racetracks following the easing of Covid-19 measures.

The Cal Expo Sacramento racetrack was forced to remain closed for live operations through the summer months and did not recommence harness racing until mid-November. Webis said ongoing concerns over Covid-19 and will impact operations throughout the rest of the season.

Breaking down its revenue performance, racetrack operations generated $5.5m in revenue, down 6.8% year-on-year, while advance-deposit wagering revenue also fell 18.8% to $1.3m.

In terms of geographical performance, operations in North America led to $6.5m in revenue, split $5.5m for racetrack activity and $969,000 advance-deposit wagering. In Great Britain, the $296,000 reported in revenue came entirely from advance-deposit wagering.

However, despite the declines, Webis non-executive chairman Denham Eke said the group is pleased with its continued licensed position in the US and California, highlighting the state as a market of opportunity.

“Shareholders will note some very exciting developments in the legislation of sports wagering in the US and the potential for that to be approved in California towards the end of this year,” Eke said.

“This is a complex business and is commented upon in more detail below. However, we do believe that WatchandWager remains well positioned in California and indeed other states to maximise our competitive advantage. As a result of this we continue to review our strategic opportunities in the USA and California in particular.”

Looking at spending for the period and cost of sales was reduced 2.1% to $4.6m, though operating costs edged up 2.2% to $2.2m. After including $53m in betting duty, as well as $39,000 in other income, this left an operating loss of $8,000, compared to a profit of $784,000 in the previous year.

Webis also reported $62,000 in financial costs, meaning pre-tax loss amounted to $70,000, in contrast to a $721,000 profit in the first half of the 2021 financial year.

The operator did not pay any income tax during the period, which meant net loss remained at $70,000, compared to the $721,000 net profit posted in the previous year.

Webis also provided an update on its performance since the end of the half, saying while activity has been steady, seasonality impacted its content over the winter months with key tracks closed and other tracks being abandoned due to unfavourable weather conditions

“This particularly affects our east coast of the US business,” Eke said. “Notwithstanding, we continue to trade well, and our numbers track above our 2019-20 performance to date.

“Initial performance at Cal Expo was hampered by poor weather and an outbreak of equine flu on the facility. This impacts field sizes and numbers of races which will transfer to lower handle. 

“Overall, across all divisions, we expect an upturn in performance in the spring of 2022, and we are very focused on improving our handle and most importantly, our margin derived from our activities and at the same time continuing to manage our cost base.”

Delaware’s handle was down from $11.7m in January last year, the second highest monthly total for all of 2021, behind the $12.2m spent in October.

However, the January 2022 figure was up 12.0% month-on-month from the $7.5m wagered in December of last year.

Revenue also dropped sharply year-on-year from a year-high of $1.7m in January of 2021 to $765,092, though this was up 157.8% month-on-month from $296,809 in December of last year.

Players won a total of $765,092 from sports betting in January, placing 228,828 wagers in the process.

Delaware Park was the state’s leading operator during the month, posting $391,335 in total revenue from $4.2m in player wagers.

Dover Downs ranked record with $214,703 in revenue and a monthly handle of $2.3m, then Harrington Raceway on $159,054 in revenue from $1.8m in consumers bets.

The statistics come from the Gambling Commission’s quarterly telephone survey, which examines gambling prevalence, attitudes and rates of harm.

The regulator noted that December 2021’s edition, which saw 4,021 people polled, marked the first time in which responses suggested statistically significant year-on-year improvements in attitudes towards gambling since the surveys began in 2016.

However while attitudes softened when compared to December 2020, a majority of the population continued to express anti-gambling sentiments.

For example, in the year to December 2020, 63.4% of respondents said that “gambling should be discouraged”. However, in the 2021 edition, this total had dipped to 58.9%.

Similarly, the portion of the population who agreed that gambling was “dangerous for family life” dropped from 74.5% to 69.9%, which was the lowest total over the five surveys carried out by the regulator.

In addition, the number of people who said that “most who gamble do so sensibly” also hit a new high, of 40.2%.

In other statements about attitudes towards gambling, such as “there are too many opportunities for gambling nowadays” or, “gambling livens up life”, a larger number of people expressed positive attitudes towards gambling in 2021 compared to 2020. However, there was not enough of a change to be considered significant.

The same was true of the phrase that “gambling is fair and can be trusted” when looking at the entire population. However, among gamblers specifically, the portion who agreed with this phrase rose from 31.9% to 36.2%.

Overall, 42.6% of the population – or 1,713 people in total – said they had gambled in the four weeks before being surveyed. This was roughly in line with 2020’s total of 42.0%, but was well below the pre-pandemic figure of 47.2%. 

When excluding the National Lottery, 28.6% of the population had gambled, which again was around level with 2020, but down from 2019.

Gambling rates – whether including or excluding the National Lottery – were roughly stable compared to 2020 for both males and females and across all age groups.

The portion of the population that had gambled online in the past year was 25.3%, which was not a statistically significant increase from 2020 but was significantly higher than the 21.1% recorded in 2019.

Looking at specific types of gambling, National Lottery draws remained by far the most popular form of play, with 26.3% taking part. However, the brand’s flagship Lotto draw experienced a significant decline in play, with EuroMillions becoming a more popular game.

A further 13.0% bought tickets for a charitable lottery draw, while 7.3% played scratchards.

There was a notable increase in land-based fruit or slot machine play, from 1.3% of the population to 2.0%, with increases recorded in pubs, gaming arcades and casinos.

However, there was a sharp decline in use of virtual gaming machines in bookmakers, such as fixed-odds betting terminals (FOBTs), with only 0.2% of people saying they had used these machines. In 2019, the UK government brought in a change limiting maximum stakes on these machines to just £2.

Online slot and instant win play declined, with 3.2% of those polled playing the games, and the vast majority of this total came from National Lottery instant win games.

Also declining was online casino gaming, down from 1.1% of people playing to 0.6%.

Sports betting remained stable, with 5.3% of the population saying they had bet on sports.

Among those who had gambled in the past four weeks, more people said they gambled infrequently, with 18.1% of gamblers saying they did so less than once a month and the majority doing so less than once a week.

The survey also asked a number of questions to determine the level of gambling-related harm in the population. Here, the low levels of harm first recorded earlier this year were maintained. 

The portion of people assigned as “problem gamblers” – based on individuals’ Problem Gambling Severity Index scores –  remained at 0.3%. The percentage of players at moderate risk, with a score of two or three, was 0.8% and those classed as low-risk – with a score of one – was 1.9%.

BGC Chief Executive Michael Dugher said initiatives from the industry had helped keep this rate low.

“Our initiatives have included using advertising to promote safer gambling messages and tools like deposit limits and time-outs, investing more in research and treatment, and introducing tough new rules on VIP schemes,” he said.

“One problem gambler is one too many, however, and we are determined to keep up the momentum in the months and years ahead.

“As we continue to make progress on problem gambling and drive ever higher standards on safer gaming in the regulated sector, it’s vital ministers don’t do anything that drives people to the unsafe, unregulated black market online, which has none of the protections or safer gambling interventions that we see with licensed operators. There is no enforcement solution to tackling the black market. You need to stop customers being driven there with further restrictions that are cumbersome, intrusive and ill-thought-through.

“Ministers need to listen to the 119,000 people who’s jobs depend on the regulated betting industry and the millions of punters who overwhelmingly bet safely and responsibly – not the usual suspects from the anti-gambling lobby who just want to ban stuff because they don’t approve of how millions of people choose to spend their own money”.

When this decline was first recorded in September 2021, from 0.6% in September 2020, Betting and Gaming Council chief executive Michael Dugher said the reduction showed that his group is having an impact, and that it showed the effects of evidence-based measures to tackle harm.

The bill – Bill 442/1191 – has been in the works for decades, having first been introduced more than 30 years ago and amended a number of times over the years to legalise a wider range of verticals such as online gaming.

It would allow for the establishment of casinos as part of integrated resorts in each of Brazil’s 26 states. São Paulo could have up to 3 casinos, Rio de Janeiro, Minas Gerais and Bahia could have up to 2 casinos each and other Brazilian states could have 1 casino each. 

As well as table games, electronic gaming machines will be permitted at these resorts, which must return at least 80% of stakes as winnings.

No operator may be granted two licenses in the same state, or more than five overall.

Licensed entities must be incorporated under Brazilian law, with headquarters and management in the country; technically capable of conducting the activity; and financially and economically credible.

Online games of chance – though not betting which is being regulated separately – would be permitted, with both the federal government and states permitted to offer licences.

Bingo, meanwhile, will only be permitted in bingo halls, jockey clubs or football stadiums, with charitable games the only other form permitted. The popular – though illegal – game Jogo de Bicho would also be permitted, but closely monitored.

While licensed online gambling would be permitted, unlicensed foreign websites would be blocked, and servers for locally licensed igaming operators must be located in Brazil.

The use of credit to gamble online will not be permitted, and gambling winnings will be taxed at 15%.

Bill 442/1191 legislation also mandates that lottery proceeds will be used to fund social security programmes.

The bill will be considered in an extraordinary deliberative hearing today. If the bill is approved by the Chamber of Deputies then ratified by President Jair Bolsonaro, it would pass into law.

As well as this bill to permit a large number of forms of gambling, efforts have been made to legalise sports betting.

These have been extremely drawn out, and ongoing since 2018. A change in proposed regulation to a concession model instead of licensing was one of the reasons for a delay in the process.

Brazilian President Jair Bolsonaro formally added sports betting to the country’s agenda in August 2020, signing a decree to add sports wagering to Brazil’s Investment Partnership Program (PPI) portfolio and national privatisation programme and appointing managers to lead the licensing process.

Last year, the Brazilian federal government approved changes which will see the country implement a tax system based on gross gaming revenue (GGR), rather than turnover.