Month: February 2023

Gross gaming revenue for January amounted to $12.3m, a year-on-year rise of 53.8% from January 2022 and also 47.7% higher than in December of last year.

The January figure surpassed the existing monthly record of $9.1m that was set in October 2022.

Read the full story on iGB North America.

Player spending in January amounted to $18.5m, down 0.5% from $18.6m last year and also 1.1% lower than $18.7m in December 2022.

Gross gaming revenue for the month reached $1.5m, a 25.0% drop from $2.0m in January of 2022 and 37.5% behind $2.4m in December.

Read the full story on iGB North America.

Momentum building in Missouri?

The dynamic duo kick off with Missouri, where multiple attempts to regulate betting have been made over the past five years. 

Senator Denny Hoskins has long been a champion of the industry, but could 2023 be the year Missouri sports betting finally crosses line? Once again there’s a bottle of wine on the time, as to whether it beats North Carolina in regulating. 

Remember, we’re now live on Spotify!

All systems go in Georgia?

There’s also renewed hopes for Georgia sports betting, though it’s looking likely to go to a ballot, Brendan says. After its missteps in Florida and California, the industry will have to learn from each of those failures if it is to enjoy a successful campaign. 

However Brandt argues sports betting should be treated as a new lottery product, something that would avoid a public vote on the matter. The guys are split on whether a bill makes it through by the end of March; Brandt is confident, but Brendan is more circumspect. 

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Empire State has igaming in mind

The US igaming market may be expanding, with Senator Joseph Addabbo filing a proposal to legalise online casino in New York. A 30.5% tax rate is tough, Brandt says, though would allow up to 20 licences. 

New York differs from others states in that the prospect of new revenue, rather than consumer protections, are front of mind. But that a focus on generating revenue may result in a model that isn’t fit for purpose, Brendan warns. Just look at the state’s mobile sports betting controls.

Federal controls on the horizon?

Episode 12 ends by looking at moves in Washington DC, with the government seeking to bring in the FCC to monitor industry advertising.

But is this sort of intervention justified, when gambling has been treated as a state issue for so long? 

Conducted by Kantar Public, the study looked at Gambling Support Service (GSS), which is delivered in the country via a joint initiative between GambleAware and Citizens Advice Scotland (CAS). 

The project delivers training to frontline workers, helping them recognise when people are at risk of, or experiencing, gambling harms. Training has been given to Citizens Advice Bureaux locations across Scotland, as well as local authority staff, services such as the police and paramedics, and debt advice, housing, and mental health charities. 

The evaluation focused on the first two years of the project, with the main concerns being that public understanding of the severity of gambling harm was limited, while stigma exists towards those experiencing gambling harm, which in turn stops them from seeking advice. 

To address these issues, the evaluation put forward a series of recommendations, including producing clearer guidance for workers setting out why gambling could be a problem for clients, as well as how to weave questions designed to identify harm into conversations. 

Kantar Public also recommended exploring flexibility in the use of questions designed to identify harm, to encourage more natural conversations with clients about gambling harms and reduce stigma.

In addition, it was suggested that more thorough training be developed to address the issue of perceived uncomfortable conversations about harms related to gambling.

The evaluation added that trainees felt the GSS played a “valuable” role in improving client advice on and aiding the reduction of gambling harm across Scotland, with workers able to offer advice and signpost to relevant support organisations. 

“We know that discussions about gambling can be challenging, and that training and the tools provided were key to preparing frontline workers to have conversations with clients about gambling,” GambleAware chief commissioning officer Anna Hargrave said.

“The production of clearer guidance and an increased flexibility around questions should help front-line workers in identifying harms, having sensitive client conversations and helping reduce stigma going forward.”

Citizens Advice Scotland chief executive Derek Mitchell added: “The Scottish Citizens Advice network is proud to deliver this very important service, which has delivered real results by training over 2,000 professionals on how to identify gambling related harms. 

“It is very clear from the feedback we get that stigma is a major problem, and that is why it is so important for the CAB network that we do not judge anyone’s circumstances or background when seeking help, and believe it is vital people seek support as soon as possible. 

“The earlier someone gets the support they need the faster they can deal with the problem; it really is as simple as that. The alternative is burying your head in the sand as problems grow and grow until they are overwhelming. People shouldn’t be embarrassed or worried about seeking help, it is the first step to solving their issues.”

The appointment, Superbet said, is in line with the group’s intention to pursue a future public listing and will support its wider growth plans in regions around the world.

Albrecht brings extensive senior and board-level experience to Superbet, having served in a number of senior roles during his career.

He is currently chairman of online real estate platform Scout24 Group and audiobook and e-book streaming service Storytel, while also a member of the board at communications and digital services platform Veon Ventures.

Prior to this, he was chief executive of music streaming service Deezer and spent time as both president and CEO of telecom and media group Tigo/Millicom International.

In addition, Albrecht had a spell as president and CEO at Modern Times Group MTG AB, a media business active in Scandinavia and East Europe. 

“Superbet presents an exciting opportunity in terms of its growth trajectory and continued expansion plans. I have been impressed by the ambitions of the company, the responsible approach to its customers and the high level of innovation and entrepreneurship shown by the team,” Albrecht said.

“I am pleased to take on the role of Chairman and look forward to supporting the high-calibre management team on this inspiring journey, as the company continues to deliver on its sustainable, international expansion strategy.”

Superbet CEO Johnny Hartnett added: “This is an amazing moment, as we write an important page of the Superbet story. As chairman of the board, Hans-Holger Albrecht will take the group to the next level in terms of strategic vision. 

“His remarkable background in nurturing successful companies will help us maximise our competitive advantage and ensure we thrive in international markets.”

The industry has an evil twin. Alongside the highly regulated legal online gambling market sits another, roughly comparable in size, that has proved resistant to efforts to reduce its scale and spread.

This black market effectively gave birth to the ‘white’ online sector, but offers none of its safeguards or benefits.

Illegal operators rarely offer consumer protection measures, and in many cases fail to even guarantee fair play or payouts. It sits beyond the reach of regulators, fails to fulfil licensing obligations and pays no tax into public coffers.

But as governments and financial institutions gear up to take steps to stamp out illegal gambling, the regulated sector risks getting caught in the crossfire. Pressure to tackle the issue on both sides of the pond is rising, putting legal operators – particularly those in Europe – at risk of finding their access to financial services limited.

Iceberg market

To Ismail Vali, founder of regulatory intelligence platform Yield Sec, the scale of the threat means that gambling is becoming an “iceberg market”, defined by a shadow sector comparable in size to the legitimate one.

Large chunks of the total market exist under the waterline. But where the waterline sits is debatable.

The definition of illegal gambling in some quarters is hazy. It can span everything from criminal operations run by gangsters to a legitimate operator’s activity in a jurisdiction without a regulatory regime.

Even at a national level, there’s significant confusion. Take the example of Malta, which for years prevented the Council of Europe from unilaterally signing the Macolin Convention on match-fixing. It took exception to the definition of illegal sports betting as “any sports betting activity whose type or operator is not allowed under the applicable law of the jurisdiction where the consumer is located”. To sign would have potentially defined any Malta-licensed B2C business offering its services to another European Union jurisdiction as illegal in one fell swoop.

Indeed, grey market exposure, or activity in a reregulating market, is a fact of life in the industry. Many otherwise blue-chip companies are involved in such markets to varying degrees, even if they passively accept bets from local customers.

For some, this has become increasingly controversial as the shift from dot.com to dot.country continues at pace. It raises questions about how businesses should think about the grey market in the years ahead. For what some view as grey, many see as definitively black.

Bank freeze

The great unknown is how European banks will define illegal gambling. Last November, the European Commission, in its supranational threat assessment, raised its money laundering and terrorist financing (ML/TF) online gambling threat level to four, the highest possible state of alertness.

This was accompanied by a lowering of the threat level for land-based gambling.

This increased risk of money laundering and terrorist financing for online gambling is influenced by the illegal market and its growth.

After all, that black market is a business like any other. It requires bank accounts, cash flows and balance sheets. Financial structures need to be accessed to keep things running.

One threat to the European industry as a whole is how the new, tougher ML/TF rules will affect the prospects of banks de-risking their portfolios. This refers to the doomsday possibility that banks and financial institutions may refuse to work with online gambling operators at all – citing the increased risk on their balance books.

Vali says the Commission believes risk has shifted online because it’s “where all the crooks have moved to”. If that’s the stance that is taken, then grey and black market sites could pull licensed businesses into their orbit.

Cutting off funding

It could get worse. According to Philippe Vlaemminck, senior managing partner at Vlaemminck.Law, there has even been talk of European tax rules progressing in this direction. “In general, already there is a problem of financing in the gambling sector,” he says.

“Banks are investigating a number of sectors where they would prefer not to provide finance any more, and the new European taxonomy rules are also going into that direction. Gambling at certain moments was included in the taxonomy, though it was later deleted.”

While a general increase in financial compliance requirements will no doubt make it much harder for illegal operators, if this limits the ability of black market operators to access legitimate lines of financing, it could be beneficial for the industry. But the blurred lines between black and white mean highly regulated businesses may feel the pinch.

If banks indiscriminately lock out legal businesses from the financial system it may counterintuitively prove to be a boon to the illegal market. And when legal options are harder to access, such as in parts of America, the black market is more than happy to pick up the slack.

Clean or not clean

How does one go about defining that black market? Many in the industry would argue that’s tricky. Yet in Vlaemminck’s eyes, there is no ambiguity.

“I’ve always been opposed to the idea of grey – there is no such thing as a grey market,” he says. “There is a black and a white market. This means you’re legal or you’re illegal. You cannot be a little bit illegal, that does not exist. You cannot be a little bit criminal. You’re clean or you’re not clean.”

Many would argue there is a clear difference between black and grey, though. They’re certainly treated differently by law enforcement and regulators.

However, perhaps the distinction is worth less than it used to be. As the regulated sector steps up action across unlicensed gambling on both sides of the Atlantic, there is a growing case that there is less and less scope for debate.

But how, then, can we attempt to illustrate the scale of the issue?

Sizing up the black market

Let’s start with the US, where the online black market is enormous by any measure. In a November 2022 report, the American Gaming Association (AGA) estimated stakes for illegal igaming and online sports betting stood at $401.8bn (£331.5bn/€373.9bn) per annum, rising to more than half a trillion dollars when illegal land-based gambling is included.

Unlike in Europe, online gaming is a novelty or illegal throughout much of the country. Sports betting is legal in 31 states and the District of Columbia; online casino in just six.

But in the US, the situation is clear cut. Any scope for ambiguity was effectively cut off when the Department of Justice unsealed indictments against PokerStars, Full Tilt and Cereus in April 2011.

In estimating the size of the European black market, the problem is laid bare. “Figures vary between $4bn and $24bn,” says Hermann Pamminger, secretary general of the European Casino Association, referring to total revenue rather than stakes.

“Individual studies have placed the European figure closer to $24bn, having adjusted the definition of ‘illegal’ to encompass all operators without a licence operating within EU countries to which they offer their services – which is a much wider net,” he adds.

This would include any business operating in a jurisdiction such as Malta targeting players in another EU country using the right to free movement of goods and services. Should the banks take a similar view, a host of big names could find large swathes of their business defined as illegal.

According to Vali, deliberate financial obfuscation means the scale of the unlawful market is often misunderstood.

The absence of correct transaction codes means it can be difficult to even decipher the character of a transaction, and therefore track it accurately.

“Criminals don’t clarify their transactions by the relevant classification,” he says. “The whole point is to conceal them as other commodities so they avoid the glare of what gaming and AML law demands.” 

Leading the counterattack

In the US, the AGA is spearheading efforts at a federal level. Gambling regulation may be the preserve of individual states, but there is a centralised government and the Department of Justice that can take up the matter.

According to Chris Cylke, AGA’s senior vice president of government affairs, the DoJ has been looking seriously at the issue. “While the Department of Justice has a multitude of concerns on its plate and its priorities are constantly evolving, illegal gambling certainly has the Department’s attention,” he says.

“We have continued to engage, educate and partner with the FBI, policymakers and other law enforcement on the need to combat these bad actors.”

Law enforcement is the key piece of the puzzle in the US. Stemming from the country’s decades-long battle against organised crime, many of the necessary laws needed to bring the hammer down on unlawful operators already exist on the books.

After all, the Wire Act, the contentious legislation that still provokes debate on the spread of mobile betting and gaming, was originally designed to target mob-run gambling. Much of what is needed is simply to enforce or better police the existing rules.

Coordination concerns in Europe

This coordination isn’t on offer in Europe; the European Commission closed all infringement and complaints proceedings related to the industry in 2017, deeming gambling an issue for individual member states.

This means the question of how to actually fight illegal operations effectively is much tougher to answer.

One approach is for regulators to penalise unlicensed activity by making grey or black market activity grounds to reject a licence application.

These so-called “suitability requirements” aren’t so common in Europe, but some US states have made efforts to bring them in.

Involvement in grey markets became an issue for Entain’s licence application in Nevada and PokerStars’ in New Jersey. While both operators received licences, questions were raised over executives and business done in jurisdictions where online gambling is not regulated. In each case, there were significant personnel changes at a senior level before licences were issued.

Australia’s example

More pointedly, Australia has moved beyond financial penalties and has pioneered the prosecution of individual executives involved in unlicensed activity. This contrasts with European policymakers who have so far avoided the topic of criminal liability.

But could that change?

Vlaemminck sympathises with the sentiments of this strategy. Equally, he argues that such an approach faces hidden complexity and must be balanced with financial measures.

“The question of criminal liability is, who is liable at the end of the day,” he says. “Is it a company? Is it actually the CEO of the company? Is it actually the chief technology supplier?

“The matter is first of all criminal liability of the companies so that there can be assets seized and things like that, because the financial harm is in my view more important than anything else.

“So, they must feel the pinch because a CEO is very easy to replace – and I think it is a little bit limited if you only take the persons involved in that. So yes, I think that it is a balancing act between the liability of the individual CEO who is actually doing illegal things.”

Fighting black markets with technical innovation

What’s clear is that new tools are needed. Despite the resources available to regulators and law enforcement, the black market has so far proved largely resistant to attempts to reduce its size.

As already outlined, one evergreen problem is a lack of clarity over the size, coherence and shape of the black market.

Vali, an industry veteran with the likes of Ladbrokes and PokerStars on his CV, believes he has the answer. Using technology developed initially for counter-insurgency purposes, his platform YieldSec tracks the illegal market in a minutely detailed way.

Once government organisations have a better idea of what they are up against, they will be in a better position to develop tools to counter the illicit organisations.

“Once you legalise and regulate, the biggest enemy and risk to everything you’ve established as an ecosystem is from one thing: crime,” Vali says.

Again and again, he emphasises that the black market was not what we thought it was, that the old rules of thumb were wrong.

“I’m not interested in using the word ‘estimates’ where Yield Sec is concerned – we developed this from military DNA for a reason: estimating is not good enough. We have to know where the audience is, what they are doing, how they are finding the content and transactions, and what the level of interaction is,” he says.

“What we have is one gambling marketplace per jurisdiction and a duality of industry operators. Some are legal and licensed; many, however, are illegal and unlicensed to be there by that specific jurisdiction. If they are taking revenue from any regulated jurisdiction that they do not have a local licence for, then they are criminal operators.”

Software like that provided by YieldSec is likely to become a key tool in the fight against illegal gambling. Though the issue of what is black, white and grey remains open to interpretation.

Brave new world

To an extent, it’s all a matter of perspective. Let’s face it, in the past, all online offerings were in a sense illegal, insofar as no legal frameworks to work within existed.

The progress of technology, especially in the last 30 years, has been rapid to the extent that it’s often said industry developments outstrip regulators’ efforts.

“I remember the first time I heard somebody talking about internet gambling, which was actually the Finnish state-owned operators,” Vlaemminck recalls. “Before they were the first ones in the world to operate games on the internet, nobody believed that it would ever emerge.

“Well, it did emerge – but whatever technology is there, you need to do it in a legal manner otherwise you kill the technology. And I believe that is what a lot of people in the industry have started to understand.

“They were illegal in the beginning. They thought they could continue like that. They have been stopped. They have been stopped in Europe, they have been stopped in the US, they have been stopped everywhere.”

The industry largely understands that today’s legalised regulatory regimes are its greatest accomplishment. The frameworks were built in reaction to facts on the ground created and pushed at every stage by pioneering businesses.

The black market operations in their most extreme form threaten that accomplishment, by making industry and government play a kind of elaborate pantomime while the real winnings are hoovered up by entities playing a totally different game.

Complicating this hugely is the status of grey market operators – and how they intend to develop in the years ahead. The direction of travel in Europe is firmly in the opposite direction, and it may be that in future we see a more definitive split between the truly white and the truly black.

But as the fight against illegal gambling is ramped up, that grey zone between those two pillars is likely to become increasingly squeezed – and operators will increasingly find themselves having to choose which path to take. 

Speaking at the group’s annual general meeting earlier today (24 February), Croker said Aristocrat had experienced an “encouraging” start to the 2023 financial year, with gaming performing particularly well in North America.

Croker said that from a macroeconomic perspective, Aristocrat continues to closely monitor possible impacts on consumer sentiment from elevated inflation and higher interest rates, as well as the evolution of supply chains. However, he said the business is well positioned to work with its customers and suppliers to manage these uncertainties.

“Group performance in the current financial year has been encouraging, and in line with our plans to date,” Croker said. “Gaming has started the year positively, particularly in North America, where our major customers’ capital commitments remain supportive.”

Focusing on specific areas of the business, Croker said the Pixel United mobile social gaming arm had been resilient in the opening weeks of 2023, despite a challenging second half of 2022 for the wider mobile market.

“While this base effect is impacting year on year growth comparisons, the overall mobile games market has continued to consolidate, without any further overall deterioration evident at this time,” Croker said.

Roxor acquisition

In terms of the Anaxi real-money gaming business, this division was recently strengthened with the acquisition of Roxor Gaming, which closed earlier than expected. Croker said Roxor’s remote game server and content publishing technology will accelerate Anaxi’s strategy to grow in the igaming market. 

Roxor is currently live in the UK and New Jersey in the US, with a planned launch in Ontario in Canada due to take place before the end of the first quarter.

Aristocrat last week also extended its content agreement with BetMGM, with Croker saying the group expects to announce a further agreement shortly and similar deals with other business over the course of the year.

In addition, Anaxi is close to launching a first-of-its-kind mobile on-premises solution for a tribal gaming operator, with the offering due to live with the Chickasaw Nation in Oklahoma in the first quarter.

Based on these developments and growth in the previous year, Croker said that Aristocrat can restate guidance to deliver year-on-year NPATA – net profit after tax, adjusted to exclude the non-cash tax-effected amortisation of intangibles and significant non-operating items – growth in 2023.

This, he said, reflects continued strong revenue and profit growth from Aristocrat Gaming, lower growth in bookings and profit from Pixel United, and further investment in Anaxi, to support its online real-money gaming ambitions. 

“In summary, the 2022 financial year was another successful one for Aristocrat, highlighting the benefit of the consistent implementation of our growth strategy,” Croker said. “Focusing on what we can control, our strategy is anchored in improving our own business and competitiveness – no matter what external challenges we face.”

Meanwhile, Aristocrat revealed that only one of the resolutions proposed at its AGM was rejected. The proposal to appoint Stephen Mayne as a non-board endorsed director was turned down.

However, proposals to re-elect Philippe Etienne, Pat Ramsey and Kathleen Conlon as directors were approved, as was the election of Bill Lance as a director. 

Launching March in tandem with Problem Gambling Awareness Month, the responsible gaming messaging will be present in the US and Canada across a range of BetMGM advertising mediums including print, radio, television, billboard marketing and its mobile app.  

Additionally, there will be messaging on the operator’s digital and social platforms and in physical operating locations.  

The company worked in partnership with responsible gaming program, GameSense in the development of the messaging. GameSense has been integrated into BetMGM digital platforms to provide educational tools and recourses on gambling responsibly.  

MGM Resorts CEO and president Bill Hornbuckle said, “with the continued growth of sports betting and igaming, it’s imperative that our industry remain committed to supporting the best interests of our guests and customers.

“MGM Resorts is the premier leader in gaming entertainment, and GameSense has helped us set the standard for promoting responsible gaming and prioritizing player health. We commend BetMGM for this groundbreaking commitment.”

BetMGM CEO, Adam Greenblatt added “we are committed to leading the industry in promoting responsible gaming, which is why we’re announcing this unprecedented pledge to spotlight responsible gaming messaging in our advertising.” 

As the legalised sports betting and online gaming industry continues to expand, it is vital that we not only equip players with tools and resources for how to play in a responsible and safe manner, but that we also make a significant commitment to showcasing responsible gaming in our advertising.”

Greenblatt continued by announcing the operator had partnered with the International Center for Responsible Gaming (ICRG). He stated the importance research has in understanding advertising and problem gambling.  

Sportsbook ad ban

The new campaign happens in the context of a federal push to ban all television, radio and internet ads. Earlier in the month, representative Paul Tonko (D-NY) proposed a comprehensive federal bill to ban sportsbook advertising in the wake of the activity’s e

The Betting on Our Future Act was introduced to the House and proposes to “prohibit the advertising of sportsbooks on any medium of electronic communication subject to the jurisdiction of the Federal Communications Commission (FCC), and for other purposes”.

The bill will have a long way to go if it even makes it past a House majority, however its proposal reflects sports betting’s rapid growth and impact on the US landscape.

Dr. Lui Che Woo, chairman of Galaxy Entertainment, said the operator had continued to experience the impact of Covid-19 throughout the year – but added that the end of travel restrictions would add a positive element to the year ahead.

“Macau like the rest of the world continued to experience the impact of Covid-19 throughout 2022, with sporadic outbreaks in mainland China, Macau and Hong Kong and the subsequent travel and quarantine restrictions impacting visitor arrivals,” he said. “I am pleased to report that in early 2023 all the travel restrictions were lifted and Macau is well positioned to welcome mainland and international visitors in 2023.”

The chairman also commented on Galaxy receiving a concession from the Macau government last year.

“Additionally, we are delighted to have been awarded a new gaming concession by the Macau Government which will be valid to December 31, 2032,” he continued. “Over the next 10 years, Galaxy will invest nearly MOP28.4 billion to enhance the facilities and services of its integrated resorts, of which over 96% of the total investment will be used for non-gaming projects and exploring overseas customer markets.”

Galaxy was one of six operators to receive a concession, in a tense bidding process that ultimately saw Genting left out in the cold.

Full-year results

Turning to Galaxy’s full-year results, most of the revenue came from net gaming, totaling at HK$6.56bn. This was down by 53.1% – more than half – of the net gaming revenue for 2021.

Non-gaming revenue was HK$2.02bn, down by 24.1% from 2021, while revenue from construction materials dropped 4.4% to HK$2.88bn.

More than half the total net revenue for the year – HK$7.41bn – came from the operator’s Galaxy Macau location. This was a decrease of 43.6% yearly.

StarWorld Macau contributed HK$1.04bn to the net revenue, another significant decline of 68.0%.

Net revenues from Galaxy’s Broadway Macau and City Clubs locations were HK$60m and HK$61m respectively.

The company’s construction materials division also generated earnings before interest, tax, depreciation and amortisation (EBITDA) of HK$566m, a decrease of 42%.

Fourth quarter

For the fourth quarter alone, net revenue was HK$1.83bn. This was up by 71.3% compared to the previous quarter, but was a decrease of 42.9% year-on-year.

This trend of significant monthly growth coupled with year-on-year decreases continued across the board.

Most of the net revenue came from net gaming revenue at HK$1.37bn, a rise of 107.8% month-on-month but a fall of 47.0% yearly.

Hotel and food and beverage revenue at HK$208m, alongside mall revenue of HK$248m, made up the remaining net total.

Galaxy Macau reported HK$1.83bn in revenue for the period, up by 71% from Q3 but down 42.9% from Q4 2021.

StarWorld Macau reported revenue of HK$246m for the fourth quarter. This represented quarter-on-quarter growth of 55.7% and a yearly decline of 63.2%.

Broadway Macau generated HK$19m in net revenue for the quarter, while City Clubs reported HK$20m.

Adjusted EBITDA at the company’s construction materials division was HK$160m for the quarter.

The group completed the purchase of Canada-based lottery management provider Stride Management in June last year, while it also added UK external lottery manager and digital payments business StarVale Group to its portfolio in November.

Jumbo said it had already felt the benefits of the acquisition in the first half, primarily within its managed services business, where both revenue and total transaction value (TTV) – the gross amount received from the sale of goods and services rendered in the period – climbed year-on-year.

“Stride has made a meaningful contribution to group earnings and we are pleased to have completed our acquisition of StarVale in November 2022,” Jumbo’s chief executive and founder Mike Veverka said.

“We continue to be impressed by the quality and growth potential of these businesses, and the integration process is now well underway. The strength of our balance sheet, strong cash generation profile and debt headroom provide significant flexibility to support further growth.”

First half

Analysing Jumbo’s performance in the six months to 31 December, revenue for the first half amounted to AU$62.4m (£35.3m/€40.1m/U$42.4m), up 18.1% year-on-year.  

Breaking this down, lottery retailing revenue accounted for $50.1m of all revenue, a rise of 7.2% on the previous year, while managed services revenue rocketed 260.7% to $8.0m on the back of the Stride and StarVale acquisitions.

Jumbo also noted $23.3m in software-as-a-service (SaaS) revenue, up 8.2% year-on-year, though $18.9m of this was attributed as inter-segment revenue. Direct revenue from the SaaS segment was $4.3m.

TTV for the entire group was 27.2% higher at $4167.0m, with $253.3m from lottery retailing segment, $97.2m from SaaS and $66.6m managed services.

Turning to spending and cost of sales amounted to $9.9m in the first half, while the primary operational outgoings were administration charges at $23.1m and marketing costs at $4.3m. Finance expenses were $333,000, which left a pre-tax profit of $24.9m, a rise of 4.4% on the previous year.

Jumbo paid $7.7m in tax and also accounted for a $902,000 foreign currency translation loss, which resulted in a net profit for the half-year of $16.3m, a 1.2% increase from $16.1m in 2021. In addition, statutory EBITDA was up by 6.9% to $30.2m.