Month: March 2022

Total revenue for the 12 months through to 31 December 2021 amounted to $488.1m (£364.1m/€439.9m), up from $278.5m in the previous financial year and in line with updated guidance issued in November.

RSI did not publish a full breakdown of its revenue for the year, but it did note that revenue grew sequentially in all of the markets in which it operates, while it was also able to expand into a number of new jurisdictions.

The operator launched online sportsbooks in Arizona and Connecticut during 2021, while it also agreed deals for online casino launches in both Mexico and Canada’s Ontario province. 

Shortly after the year end, RSI rolled out online sportsbooks in both New York and Louisiana following the launch of legal online sports betting in both states. In addition, RSI last month partnered Penn National Gaming to secure market access in Ohio, Maryland and Missouri.

This meant RSI now offers online sports betting in 13 separate markets, with market access deals in place in another 10 jurisdictions. RSI has also launched online casino in five markets, with access agreements for a further 15, while it offers retail sports betting in six markets and has agreed access deals in another three markets.

Looking at spending for the year and total operating costs were 41.4% higher at $582.4m.

Adjusted earnings before interest, tax, depreciation and amortisation (EBTIDA) – which takes into account some, but not all, of these operating costs – dropped from $4.4m in 2020 to a loss of $65.1m.

RSI also noted $27.9m in other expenses, with $41.8m in change in fair value of warrant liabilities offsetting a $13.7m loss associated with earnout interest liabilities and $187,000 in interest expenses.

This left a pre-tax loss of $66.4m, almost half the $128.7m loss posted at the end of 2020. RSI paid $4.7m in income tax and despite noting $51.6m in additional profit attributable to non-controlling assets, RSI ended the year with a net loss of $19.5m, compared to a profit of $1.1m in the previous year.

In terms of fourth-quarter performance, revenue for the three months to 31 December was 30.6% higher at $130.6m.

Operating costs increased 16.8% to $167.6m while adjusted EBITDA loss widened from $1.3m to $31.2m. Other expenses amounted to $146,000, leaving a pre-tax loss of $37.2m, a slight improvement on $38.7m in the previous year.

RSI paid $907,000 in tax, which, after also including profit attributable to non-controlling assets, meant it ended the quarter with a net loss of $10.4m, compared to a $1.1m profit in 2020.

“We are continuing our disciplined approach of balancing profitability from existing markets and investing in new market launches,” RSI chief executive Richard Schwartz said. “RSI’s consumer experience leverages our best-in-class technology and now operates successfully in 14 total markets compared to only six at the end of 2020. 

“Our track record demonstrates that we have been highly successful stewards of capital for our investors. Delivering strong shareholder returns remains our priority.

“On the technology and product side, we continue to enhance our offerings and provide a best-in-class gaming experience to our customers. As planned, we went live with our integrated iOS sportsbook-casino app near the end of 2021. 

“During the first half of 2022 we look forward to expanding into Canada and Mexico with our online casino and sportsbook sites and apps in these two large population markets where we are well positioned to achieve success.”

RSI also issued guidance for the 2022 financial year, during which it said revenue should be between $580m and $630. The midpoint of this range – $605.0m – would represent a year-on-year increase of 24.0%.

Early in December last year, the stage in São Paulo was set for a major development for fixed-odds sports betting. The industry’s first in-person conference in two years was due to take place, and attendees were eagerly awaiting an announcement that the Presidential Decree regulating Law No. 13,756/2018 would be rolled out.

The fact that SECAP, the Evaluation, Planning, Energy and Lottery Secretariat of the Ministry of the Economy, which has been responsible for spearheading the exercise, was sending a full team, led by then-Secretary Gustavo José de Guimarães e Souza had seemed especially significant. 

To the disappointment of the delegates, SECAP did not provide any concrete details as to the exact date on which such regulations would be rolled out. Instead, it limited itself to mentioning that the desire was to issue them in time for the Fifa World Cup, in Qatar, at the end of 2022. 

As a result, the industry began 2022 without the update it had expected. But should it continue to be sceptical when – or if – this will happen?

Law No. 13,756/2018 states that the regulations for fixed-odds sports betting should be rolled out within a period of four years (two years, with the option to extend for an additional two). This means that the deadline is approaching at the end of 2022. 

While there is uncertainty as to what would happen if the deadline were missed, the signs are now clearer than ever that the Presidential Decree is close to being released. It may well be that by the time this article is published, this has occurred.

First, a particularly controversial aspect has been addressed. Law No. 13,756/2018 initially set out plans for a tax based on turnover rather than GGR, at a rate of 3% (for online) and 6% (for land-based). That issue was resolved last year, when the law was amended to use GGR as the basis for calculating taxes.

Second, around the time ICE London 2022 was postponed from February to April, Secretary Guimarães e Souza announced he was stepping down from SECAP. 

At that time, local media reported he was going to work for the private sector but, in February, he took up a new position as Parliamentary Secretary at the Brazilian Senate. The new Secretary is Sérgio Ricardo Calderini Rosa, who is known to be a liberal and appears to be inclined to roll out the regulations in the very near future. 

Third, with ICE moving to April, there will be more time for SECAP to finish polishing the text of the presidential decree. There are rumours it has been ready for some time now, and that it will be issued either prior to, or at, the world’s premier betting and gaming showcase in London. 

Fourth, based at least on the draft wording made available during the former public consultation rounds organised by SECAP, the industry will have six months from the beginning of the licensing process to start operations. This means that with the Brazilian Presidential Elections in October and Congress slowing down from April, there will be an incentive to roll out the regulations before ICE 2022.  

Fifth, there is the progress of Bill of Law No. 442/1991, which aims to legalise all forms of land based and online gaming, to consider. A recent draft of the bill included sports betting, though it was excluded from the the final document approved by the House of Deputies in the early hours of 24 February 2022.

This decision was taken on the basis that betting had already been legalised by Law No. 13,756/2018. This may raise the prospect of fixed-odds betting (not only sports related, but also including other non-sporting events) being included in the same legislation. 

It would, however, be better if the Presidential Decree were to be released beforehand. The Bill of Law introduces many regulatory requirements, obligations and procedures that may be harsher than those expected to be included in the Presidential Decree.

It is worth noting that 442/1991 treats gaming and betting operators very similar to banks and imposes a high level of compliance and scrutiny. For example, based on 442/1991, the operator could be required to have a paid-up share capital of at least BRL100bn (£14.46bn/€17.37bn/$19.38bn). 

One of the unknowns of the future Presidential Decree is what the licensing process is going to look like. The dichotomy lies between the adoption of the concession model, where a limited number of licences are made available to operators bidding against each other, or that of authorisation, whereby operators are granted a licence if legal, financial and technological requirements are satisfied.

Market research suggests somewhere between 400 and 500 foreign operators already access the Brazilian sports betting market. According to H2 Gambling Capital, it generated around BRL12.5bn in revenue in 2020. 

It would therefore be in the best interest of the federal government to license as many operators as possible, to both create jobs and reduce potential tax losses. Personally, I have always defended the the open licensing (authorisation) model. It has been adopted in other regulated industries, such as the airline and banking sectors, and has worked very well so far.

It is therefore my expectation that the new, liberal SECAP Secretary will realise the authorisation model is the best fit for Brazil, and will embrace the same.

But perhaps now more than ever before, time is of the essence, and not just because 442/1991 is gaining momentum. There is also the Brazilian Supreme Court’s judgement on whether Article 50 of the Brazilian Criminal Contraventions Law is constitutional. Should this be struck down, games of chance could be legalised even without regulations – even with the court adjourned until 7 April. 

SECAP should therefore finalise its work on the Presidential Decree as quickly as possible, to have President Bolsonaro enact the norm before he is swamped by elections. 

Neil Montgomery is the Founding and Managing Partner of Montgomery & Associados, at which he heads the law firm’s Minds Sports, Draws, Gaming, Betting and Lottery Practice Group. Neil represents Brazil as a General Member at IMGL, is a published author and a regular speaker at international gaming and betting events.

Under the four-year partnership, Epic will work with the Rugby Players Association (RPA), Rugby Football Union (RFU) and Premiership Rugby (PRL) to deliver a gambling awareness education programme.

Epic will use first-hand experience to educate players on the risks of problem gambling and gaming, as well as explaining when and how they can access help and education related to anti-corruption.

In years one and three, the new programme will focus on Premiership clubs, Championship teams, the Red Roses squad and England Sevens men and women squads.

Years two and four will be targeted at regional academy between the ages of 16 and 18, as well as all Women’s Premier 15s clubs and Women’s Premier 15s players aged 16 to 18.

The new arrangement follows on from a programme that was rolled out by the RPA and Epic in 2017, the first gambling awareness education of its kind for professional sportsmen and women in the UK.

“In 2017, EPIC helped us to deliver the first gambling awareness education programme for elite athletes in the UK,” RPA player welfare director Richard Bryan said. “To be able to build on that relationship and deliver a multi-year, in-depth programme for more players with EPIC, the RFU and PRL is a significant step.

“Research suggests that professional athletes are more likely to be problem gamblers than those in the general population and the effects can be devastating. As such, it is crucial for us to ensure that players understand the risks associated with problem gambling, as well as the support available to them.”

Epic’s director of sports partnerships John Millington added: “We are thrilled to continue our work with the RPA. Furthermore, we’re delighted to extend this work in rugby with the RFU and Premiership Rugby; it’s great to see such a joined-up approach across the sport for such a pertinent and growing issue.”

The double purchase formed part of a wider deal agreed in December last year, which also included the acquisition of the Live! Casino & Hotel Maryland, though this purchase is yet to complete.

GLPI funded the two acquisitions by assuming $423.0m in debt, which has already been repaid, and by issuing approximately $137.0m of operating partnership units, with the balance paid in cash on hand partly generated by the issuance of senior unsecured notes and common stock in December.

In addition to completing the double deal, GLPI entered a master lease with Cordish, under which Cordish will continue its uninterrupted ownership, control and management of the operations of Live! Philadelphia and Live! Pittsburgh. 

The PA Live! Master Lease, which covers both venues, has an initial annual cash rent of $50.0m and an initial term of 39 years, with a maximum term of 60 years, inclusive of tenant renewal options. It also has fixed annual lease escalation of 1.75%, beginning in the lease’s third year.

Live! Philadelphia has over 510,000sq ft of gaming, hotel, dining and entertainment space, featuring more than 2,100 slot machines, 116 live action table games, a 29-table poker room, 15 electronic table games, and a FanDuel sportsbook and lounge.  

The property also has a 208-room hotel, a six-room event centre featuring 15,000sq ft of meeting space and multiple dining and nightlife options.  

Live! Pittsburgh is set over 100,000sq ft and features 750 slots and approximately 30 live-action table games plus a FanDuel sportsbook.

“We are delighted to add the Live! Pennsylvania properties to our portfolio and expand our presence in the attractive Pennsylvania market with truly world-class properties,” GLPI chairman and chief executive Peter Carlino said.”

“Further, our PA Live! Master Lease with Cordish has strong rent coverage and is part of an accretive overall transaction that positions Gaming and Leisure Properties to continue to build value for shareholders through our industry- leading, high quality tenant roster. 

“We are excited to welcome the Live! Pennsylvania properties to the GLPI family and we look forward to working with their team to support the long-term success of the properties.”

Meanwhile, GLPI noted that it expects its planned acquisitions with Bally’s Corporation for properties located in Rock Island, Illinois and Black Hawk, Colorado are expected to close in the first half of 2022, while the Tropicana Las Vegas deal should to close by the end of the year.

This was 2.3% higher than the previous record of 883 suspicious matches recorded in 2018.

The matches took place over 10 different sports across 76 countries. They were flagged by Sportradar’s Universal Fraud Detection System (UFDS), a bet monitoring system which detects instances of suspicious betting activity during matches.

Looking at the reports by continent, most suspicious matches were recorded in Europe, with 525 in total. Asia saw the second most, at 161, followed by South America with 131.

Football had the by far the most instances of suspicious matches, totaling 694. Basketball was second with 62 and tennis came in third with 53.

Over the full year, the largest numbers of suspicious matches were flagged in September and October, with 105 and 104 respectively. This lines up with the beginning of the football calendar in Europe, with the season traditionally beginning in late Summer.

Elsewhere in the report, Sportradar’s Global Betting Turnover Model estimated that total turnover for sports betting in 2021 reached €1.45tn.

Football accounted for €745bn of this, 51% of the overall turnover, while tennis followed with €190bn. Basketball made up €185bn of the turnover.

Looking to 2022, the report estimates that the number of suspicious matches will grow as disruptions from the novel coronavirus (Covid-19) pandemic become less common.

“The global issues of the past few years have put financial pressure on competitions, teams and athletes, and match-fixers are clearly taking advantage,” said Andreas Krannich, managing director at Sportradar. “In 2021 we witnessed a record number of suspicious matches.”

“Although this is a very small percentage of the total number of matches played globally in sport, and the vast majority of events are free from corruption, our data clearly shows that match-fixing remains a constant and growing threat across the world of sport.”

Last month Sportradar struck integrity deals with the Brazilian Football Confederation, the United States Football League and Athletes Unlimited.

The accreditations, both of which last for three years, recognise that an operator runs their licensed lotteries with high standards of player protection and safety. Camelot has held the accreditations for 12 years in total, with the most recent coming in 2019.

Since the last accreditation, Camelot made as series of changes to its healthy play strategy, including an increased focus on a de-centralised approach to healthy play, whereby all staff at Camelot are committed to promoting healthy play. 

This includes initiatives such as annual healthy play training for all employees and tailored training for different business areas, such as game awareness in player protection training, for new employees who work on creating National Lottery games.

Camelot has also carried out an external independent review of its game design process and enhanced it further with new assessment capabilities, which measure and evaluate any potential risk of games. Camelot now uses three tools to assess the level of risk associated with its games.

Other initiatives include a range of new online tools such as lower deposit and play limit for at-risk players. The system works by using a behavioural analytics model to identify at-risk players and, to support them, reduce their daily play limit and weekly wallet load limits.

In the retail sector, the minimum age to play National Lottery games was increased from 16 to 18 following a wide-ranging review of gambling laws by the British government. Camelot implemented the change on 22 April last year, five months before the new laws came into effect.

Also in retail, in 2020 Camelot launched a new online healthy play online training module for National Lottery retailers to inform and test their knowledge about being a responsible retailer on the National Lottery Retailer Hub website. The site now features an ‘Interactions’ section that enables retail partners to record healthy play and underage sales interactions.

“We’re incredibly pleased to have achieved the European Lotteries and World Lottery Association’s Responsible Gaming Certifications for a fifth consecutive time,” Camelot chief executive Nigel Railton said. “At the end of this cycle, it will be a decade-and-a-half that we’ve held these highly respected certifications.”

“We take a lot of pride in that, as well as the fact that we’ve been accredited from day one of the inception of the certifications. We firmly believe that this sets us apart and evidences our leadership role in this space.”

“But we also know that our work in this area is never finished, despite everything we’ve achieved. We plan to continue working hard on our healthy play credentials and driving up our own high standards, keeping National Lottery players at the heart of everything we do.”

Currently, licences for the special administrative region’s three concessionaires, as well as its three subconcessionaires, will expire on 26 June of this year.

However, according to reports first published by Macau news channel Teledifusão de Macau, the Secretary for Economy and Finance, Lee Wai Nong, is currently “studying” whether to extend gambling licences until the end of the year.

The report added that Macau’s six operators have all been told to prepare to apply for an extension.

This, he said, will allow the bidding process for new licences to come under the terms of an amended Gambling Act, as the Legislative Assembly is currently considering a law to change how gambling is governed in Macau.

Under this act, the number of concessions will be increased to six, but subconcessions will be scrapped, meaning the number of operators in the market would remain the same as before.

The licence term will also be shortened from 20 years to 10.

Other rules to be introduced include limits on the number of gaming machines that may be operated, plus new rules designed to curb the influence of junkets.

Betring LLC had been operating the Parimatch brand in Russia under a deal agreed with Parimatch Tech in 2016, whereby all rights to use the Parimatch trademark in the country were transferred to Betring.

However, Parimatch Tech has now prepared and sent termination documents to Betring to cease operating the brand in Russia. The developer is also in the process of developing restrictions for the use of the Parimatch brand in local sponsorship contracts.

The Parimatch brand was founded in Ukraine in 1994 and the main development centre of Parimatch Tech is currently located in the country’s capital of Kyiv.

“We have always been proud of the Ukrainian roots of our company, and in these difficult times we are even more overwhelmed by love for our native country,” Parimatch Tech said. “We strongly condemn the military aggression against Ukraine and try to do everything possible to help Ukraine.”

Parimatch Tech also said that it had allocated UAH30m (£750,180/€905,610/$1.0m) for protective ammunition, food, medicine and logistics to help Ukrainians fighting to protect the country.

In addition, the developer said it will continue to pay salaries, hire new employees and maintain guarantees for those who planned to leave the business before the war.

Companies across the gambling industry have rallied to support Ukraine during the war. Earlier this week, the Gaming Industry for Ukraine initiative was launched, with the aim of raising £250,000 for people displaced by the war in Ukraine. 

All proceeds from the fundraiser will be donated to Choose Love’s Ukraine Crisis Fundraiser. At the time of writing, more than £76,000 has been pledged to the initiative.

Operators LeoVegas and ATG have also both made large donations to the Red Cross. ATG donated SEK2m to the charity, while LeoVegas committed SEK500,000.

Online revenue of £3.01bn was the biggest contributor to the total, up by 12.3% from 2020. The operator said it was able to capitalise on fans returning to live sports venues after the Covid-19 pandemic, especially in the UK where online net gaming revenue (NGR) increased 12.0%.

Targeted marketing campaigns, such as ads aimed at football fans and sponsoring the TV show First Dates, combined with product investment such as the Ladbrokes 5-a-side platform helped aid growth in the UK online sector.

In Italy, NGR increased 31.0% across the Eurobet, bwin and Gioco Digitale brands. This was boosted by new products such as new NBA game footage, pre-match football player markets and 300 new casino games in Eurobet.

A total of £791.1m came from the retail sector, down 8.0% from 2020. Covid-19 restrictions were a major factor, as national lockdowns and venue closures meant Entain’s entire estate remained closed during the first quarter of the year.

Retail shops across Italy, Belgium and Ireland were also closed for much of the first half of the year. They opened up incrimentally between May and June, although they were operating under heavy restrictions.

Revenue other segments of Entain’s business, such as B2B operations, came to £32.8m for the year.

Georgraphically, the largest portion of Entain’s revenue – £1.75bn – came from the UK, while Italy’s contribution was £392.4m. The rest of Europe had revenue of £966.2m, up slightly from the £962.9m recorded in 2020.

Australia brought in revenue of £458.1m, up from £383.3m the year prior. Revenue from the rest of the world came to £258.8m.

In terms of expenses, Entain’s cost of sales increased to £1.39bn from £1.25bn in 2020. Administrative costs totaled £1.92bn, while adminstrative costs excluding marketing were £1.33bn.

Operating profit for the year came to £355.8m. After accounting for finance expenses of £82.9m, £118.2m gains from financial and debt instruments, £2.1m finance income, income tax of £117.6m, and £14.9m losses from discontinued operations, Entain’s net profit was £260.7m in 2021 – a massive 228.3% increase on the previous year.

Earnings before interest, taxation, depreciation and amortisation (EBITDA) amounted to £881.7m, an increase of 4.6%.

The growth of joint venture BetMGM helped drive revenue in North America. The brand went live across nine states, such as New York, Arizona, and Ohio. BetMGM maintained a 29% market share in igaming and an 18% market share in sports betting by the end of the fourth quarter of 2021.

Entain CEO Jette Nygaard-Andersen said: “Our full-year results demonstrate yet again that Entain is a business with growth built into its business model. Our strong performance is underpinned by the Entain platform which encompasses the compelling combination of our proprietary technology, our outstanding people around the world, and our industry-leading operational capabilities.

“Given the quality of our people, the ongoing broad-based growth of the business, its continuing momentum, and the investments that we are making in innovation to support our future expansion, we remain confident in our financial performance for FY22 and beyond.”

During 2021, Entain completed the acqusition of Avid Gaming in a CAD$300m deal, and it also acquired the esports assets of Unikrn.

Meanwhile, a potential takeover of Entain from DraftKings eventually fell through in October 2021 after both parties failed to reach an agreement.

Oinonen has over 10 years of experience in the industry, having previously worked for GiG and Global Gaming Group where he held senior SEO and marketing roles.

Preior to his appointment at CashMagnet, Oinonen worked at Mediainvesting, where he became COO after just over a year at the business.

As part of his new role he will be developing CashMagnet’s affiliate business, deploying marketing strategies across MrGamble.com, UKBingoSites.co.uk and DailyCasinoBonus.co.uk.

Paavo Salonen, Co-founder of CashMagnet Ltd, said: “I am delighted to welcome Joni to the team and for CashMagnet to leverage his years of experience in SEO, brand building and marketing.

“We have been riding an incredible upwards growth trajectory driven by our flagship Mr-Gamble brand and Joni will help guide our rocket ship as we continue our journey into the stratosphere.

“We have big plans for our current sites as well as several new brands in the pipeline and I look forward to working closely with Joni over the coming months as we keep disrupting the sector with our market-leading comparison sites.”

Oinonen said he was excited by the challenge of the new role.

“I enjoy the challenge and excitement of building brands and with CashMagnet I have the opportunity to work across a network of sites that are setting the standard for others to follow.

“Mr Gamble has quickly become one of the most successful online casino comparison sites in key markets such as the UK, Finland, Canada and the USA, and I am looking forward to taking the company’s marketing activity to the next level.

“I am also excited to be taking on the task of building awareness for the other sites in the CashMagnet network and to also be launching the new brands the company has in the pipeline.”