Month: February 2024

Revenue at Boyd in 2023 amounted to $3.74bn (£2.96bn/€3.47bn), up 5.2% year-on-year and an all-time high. Adjusted EBITDAR also edged up to a record $1.29bn.

The core casino gaming business remains the primary source of revenue, but Boyd noted a slight decline in this segment. Room and food and beverage revenue both increased slightly year-on-year.

However, it was the online segment that pushed Boyd to record revenue for the year. Online revenue was up 66.2% to $422.2m, making it the second-highest contributor to revenue at Boyd behind casino gaming.

Consecutive record years for Boyd

Reflecting on the year, Boyd CEO Keith Smith praised the performance of the online business during 2023. He also highlighted the impact of management fees revenue, which rocketed by 186.9%.

“It was another great year for our company,” Smith said. “We continue to build on the record performances we have delivered over each of the last several years. 2023 was the third consecutive year we set revenue and EBITDAR records on a full-year basis.

“This performance is a tribute to our diversified portfolio with strong growth from both our online and managed businesses. This growth was complemented by stable revenues from our property operations as we saw continued strength in play from our core customers and growth in our non-gaming business.”

Boyd notes small decline in land-based casino activity

Breaking down the results in full, Boyd reported a 2.3% drop in gaming revenue to $2.61bn in 2023. However, food and beverage revenue climbed 4.5% to $288.4m and rooms revenue 5.3% to $199.1m.

As noted by Smith, there was an increase in management fee revenue to $76.9m, with other revenue also rising 2.7% to $138.5m. However, it was online that was the star performer for Boyd in 2023 and ultimately what pushed it to record revenue.

As for segmental performances, Midwest and South led the way with $2.04bn in revenue, down 1.7%. Las Vegas Locals revenue slipped 0.3% to $928.1m but Downtown Las Vegas revenue edged up 3.3% to $222.4m.

As reported, online revenue topped $422.2m, with management fees and other revenue at a combined $123.8m.

Higher costs hit bottom line in 2023

Turning to spending, operating costs for the year reached $2.84bn, up 10.2%. Gaming was the main cost at $1.00bn, with selling, general and administrative at $389.9m and online $359.0m.

Boyd noted a further $148.9m in finance-related costs, leaving a pre-tax profit for 2023 of $752.9m, down 9.2% year-on-year. 

After paying $132.9m in tax, Boyd reported a net profit of $620.0m, a decline of 2.0% from 2022.

Q4 net profit down 46.4%

Looking to the fourth quarter, there were some similarities with the full year. Revenue was up 3.4% to $954.4m. 

Again, this was due to growth in the online segment, with revenue rising 38.4% to $124.1m. Gaming revenue slipped 1.0% to $647.1m but there was growth across food and beverage, rooms and management fees revenue.

Costs-wise, operating expenses increased 19.4% to $799.4m and finance costs were higher at $41.8m. This, coupled with only modest revenue growth, meant pre-tax profit declined 49.9% to $113.2m.

After paying $20.6m in tax, Boyd was left with a Q4 net profit of $92.6m, down 46.4% from 2022. Adjusted EBITDAR for the quarter was also 1.5% lower at $328.2m.

Smith, however, remained upbeat over the quarter, describing it as “strong” for Boyd and a “fitting conclusion” to another record year.

“Our fourth-quarter and full-year results were driven by our diversified portfolio, consistent core customer trends and solid returns from our recent property investments,” Smith said.

Revenue for Q1 at Mohegan amounted to $425.2m (£336.8m/€394.6m), up from $406.6m in 2023. Mohegan put this down to several factors including growth in its digital business and non-gaming revenue from Mohegan Inspire.

The new Mohegan Inspire resort hosted a soft opening on 30 November, with visitors able to access certain amenities. This includes three hotel towers, more than 10 restaurants and a multi-purpose arena. 

More opening phases will follow, with a foreigner-exclusive casino having also opened last week, with the resort to be fully operational by the end of the first half.

However, costs associated with this opening had an impact on financial performance in Q1. Coupled with non-controlling interest adjustments at Niagara Resorts and low table hold at some properties, this resulted in a net loss for the quarter.

Lower gaming volumes hit Mohegan in US

Taking a closer look at segmental performance in the three months to 31 December 2023, gaming revenue was 1.7% higher at $285.7m. Food and beverage revenue climbed 13.8% to $43.7m, hotel revenue 6.8% to $31.6m and retail, entertainment and other 11.3% to $64.3m.

The Mohegan Sun property in Connecticut in the US remains, by some distance, the main source of revenue. For Q1, revenue reached $228.4m, down 4.6% on the previous year due to lower gaming volumes and table hold.

Elsewhere in the US, the Mohegan Pennsylvania posted $59.0m in revenue, down 1.2%. The operator said lower gaming volumes were partially offset by strong food, beverage and hotel revenue.

Revenue from Niagara Resorts edged up 0.2% to $74.2m, driven by strong food, beverage and entertainment revenue. 

However, it was the digital business that was the star performer in Q1, posted a 224.1% revenue increase to $36.2m. This was put down to an accounting adjustment due to how Connecticut requires online casino and sports wagering payments be made to the state.

Mohegan noted an additional $24.3m in management, development and other revenue for Q1, up 63.6% year-on-year. A further $7.4m was reported in other revenue, including input from Mohegan Casino Las Vegas. 

Net loss tops $97.0m in Q1

In terms of spending, operating costs for Q1 reached $393.3m, up 16.9%. Gaming was the main outgoing at $159.1m, while advertising, general and administrative costs reached $95.7m.

Other costs for the quarter amounted to $128.8m. These included $66.3m in net interest expenses and a $62.6m loss on fair value adjustment.

As such, Mohegan was left with a pre-tax loss of $96.8m, compared to a $2.2m profit in Q1 of 2023. The operator paid $122,000 in tax, resulting in a net loss of 97.0m, in contrast to the previous year’s $807,000 profit.

In addition, adjusted EBITDA for the quarter declined 21.9% to $79.0m.

XLMedia said revenue and adjusted EBITDA will likely be at the lower end of ranges set out in December. Both were forecast to be lower year-on-year due to shortfalls in North America.

In another update, XLMedia says revenue for 2023 will be approximately $50.0m (£39.6m), down 32.2% from the previous year. The group in December forecast between $50.0m and $52.0m.

As for adjusted EBITDA, this should reach $12.0m, a drop of 28.1% from 2022. This is also at the lower end of December’s guidance range of $12.0m to $14.0m.

Mixed news in the US

Going into detail on its performance in 2023, XLMedia says it was impacted by several major developments. 

First, it notes the return to growth of premium European assets including Nettikasinot, WhichBingo and Freebets.com. The group also says it made further progress in replacing legacy technology and implementing further cost reduction measures.

However, following a strong start to the year in the US, with the launch of online sports betting in Ohio, significant changes in operator customer acquisition activity impacted its performance.

Among these was the withdrawal of the Barstool Sportsbook betting brand and subsequent launch of ESPN Bet. XLMedia also noted the substantial spike in revenue in early 2022 after New York launched online sports betting in New York, with 2023 revenue reflecting the reduced scale of state launches in the period.

Preparing for growth in 2025

As for its plans for 2024, XLMedia picks out several highlights. These include the launch of online sport betting in North Carolina, expected in mid-March. 

“North Carolina is expected to be a material market for sports betting,” XLMedia said. “We remain well placed for the launch with both owned and media partner brands.”

While further state launches are not currently planned during 2024, XLMedia expects to see an acceleration in the legalisation of online sports betting in other states after the election later this year. Some 20 states remain without a legal betting market, with some currently in active ballot initiatives.

As such, XLMedia says 2024 will be a year of consolidation for the business, with a focus on both its US and European operations. 

“XLMedia will continue to focus on growing its premium European brands and maximising existing opportunities in the US,” XLMedia said. “The group will look to deliver additional savings to right size the business in preparation for further market growth in 2025.”

Ackroyd exits as CFO at XLMedia

The update comes after XLMedia last month announced Caroline Ackroyd is to resign from her role as chief financial officer.

Ackroyd will leave the business on 31 March. She is stepping down as CFO of XLMedia to take up a position with an operator in the gambling sector.

Ackroyd has served as CFO of the affiliate business since March 2022. She was appointed to the position in November 2021 but did not take up the role until a few months after.

The Netherlands government implemented a ban on most forms of gambling advertising back in July. The change prohibited advertising through most media channels. This included television, radio and print, while the rules also banned advertising in public places.

However, the laws still allowed targeted advertising in some contexts. This meant ads within on-demand streaming services, social media, through direct mail and online gaming environments were still permitted.

Boswijk’s aim with the motion, as reported by Casino Nieuws, is to protect young people and vulnerable groups. He still feels they are coming into contact with targeted advertisements. Boswijk’s motion was also signed by fellow Dutch politicians Diederik van Dijk, Nicolien van Vroonhoven, Michiel van Nispen and Mirjam Bikker.

There will be a vote in the house of representatives on the motion on Tuesday. This will gauge whether a total ban will receive the required support.

Motion on deposit limits

Bikker also brought in a motion to introduce an overarching gaming limit for Dutch providers, reported by Casino Nieuws. Bikker criticised Franc Weerwind, the Netherlands minister for legal protection, for his lack of protection for vulnerable players.

The motion is calling on the government to apply an overall limit for deposits and losses on online casino, with gamblers unable to increase them on their own. Bikker’s motion was co-submitted by nine other politicians, including Boswijk, from a variety of political parties.

As revealed by Casino Nieuws, Dilan Yesilgöz, the Netherlands’ minister of justice and security, assured Weerwind was taking steps to introduce overarching playing limits.

Netherlands’ growing commitment to player protection

In 2021, Bikker and Van Nispen tabled the motion that led to the current ban on untargeted advertising. That law change, and this fresh motion to go even further, is another indicator of the Netherlands government’s plans to clamp down on gambling advertising.

Kansspelautoriteit (KSA), the Dutch regulator, made it clear that the goal will be for 95% of those viewing targeted ads to be over the age of 24. The KSA only issued “limited” guidance for the ban, hoping operators would take the lead on this issue.  

In December, Weerwind introduced a number of new measures that he hoped would protect players from problem gambling after what he called “worrying and undesirable developments” in the Netherlands’ gambling industry.

The measures included providers being required to contact players who have set a deposit limit of €350 (£303/$386). Weerwind’s other proposals involved exhibiting financial amounts in euros and pushing for further research on overarching gaming limits.

In October, Weerwind announced a multi-year digital resilience campaign programme to combat fraud associated with online gambling.

Industry hitting back

The growing pressure on operators in terms of regulation has led the industry to defend itself, while also warning how Weerwind’s plans could lead to gambling being seen in a bad light.

Peter-Paul de Goeij, chairman of the Dutch Online Gambling Association (NOGA), advised Weerwind that his measures could lead to gambling being seen as “unattractive”.

“It is good that the minister clarifies the rules for safe gambling and thus makes the duty of care more concrete,” De Goeij stated.

“At the same time, we must always be careful that legal gambling is not made too unattractive. We will study the proposal carefully and make suggestions to improve it and thus achieve the desired effects.”

Meanwhile, Helma Lodders, chairman of the Licensed Dutch Online Gaming Providers (VNLOK), highlighted two areas of Weerwind’s letter that needed further examination.

“Firstly, that imposed measures are actually effective in keeping the number of problem players as small as possible,” Lodders explained.

“Secondly, that the legal offer remains sufficiently attractive for the vast majority of players who participate in a responsible manner. The latter is important to prevent them from returning to the illegal supply.”

Posting preliminary results for Q4, Century said revenue should amount to between $140m (£111m/€130m) and $145m. This would be an increase from $104m in Q4 of 2022, with the midpoint of the range being 37.0% higher year-on-year.

However, higher costs across the business mean net loss is set to increase for the quarter. It is expected to be between $9.8m and $13.6m, compared to $4.0m in Q4 in the previous year.

Century did not go into full detail on revenue performance, but it did pick out several recent developments. 

These include securing new licences for its casinos in Poland that closed late last year but are due to reopen. The Bielsko-Biala casino will reopen this month and the Katowice site in March. Meanwhile, its Wroclaw casino that closed in November will be open again by mid-2024.

Elsewhere, construction projects at its location in Cape Girardeau and Caruthersville, both in Missouri, are on time and budget. A hotel at Cape Girardeau is set to open in April, while a casino and hotel in Caruthersville will follow before the end of the year.

“Transitional” 2024 at Century

Looking ahead, co-chief executives Erwin Haitzmann and Peter Hoetzinger are positive about the year ahead. They say 2024 will be a “transitional” for Century ahead of expected growth in 2025.

“We expect 2024 to be a transitional year for the company as we continue to integrate the Nugget and Rocky Gap operations into our portfolio and complete our two large construction projects in Missouri,” Haitzmann and Hoetzinger said.

“It is estimated our company-wide capital expenditures, excluding the Caruthersville project that we are financing through Vici, to be approximately $46m in 2024. 

“We look forward to 2025, when we can see everything we are working towards in 2023 and 2024 coming to fruition without the disruptions we are currently experiencing.”

Higher spending hits bottom line

Looking at the other figures and the three months to 31 December 2023, costs will be higher across several areas.

Interest expense should be between $24.5m and $25.5m, in contrast to the $17.0m posted in 2022. Elsewhere, depreciation and amortisation could be as high as $12.0m, up from $6.8m.

Tax is set to be between $3.0m and $5.0m, whereas in 2022 Century received a $500,000 tax benefit. 

However, despite rising costs and an expected higher net loss, there is good news in terms of adjusted EBITDAR. This is forecast to be between $24.0m and $26.0m, compared to $21.7m in Q4 of 2022.

“We feel comfortable with our cash position and capex plan and we continue to look for every opportunity to reduce operating costs going forward to maximise earnings and cash flow,” Haitzmann and Hoetzinger said.

“In addition, we are evaluating ways to reduce our non-operating costs going forward.”

According to the Bureau, the gambling operator is accused of evading paying UAH1.20bn in taxes in Ukraine. The operator in question does hold a licence in the country.

The Bureau says an investigation found people employed by the operator have been running unlicensed online gambling. More than 30 “mirror” sites similar to that of the licensed operator were offering gambling illegally.

Investigators also uncovered a “misdirection” of payments scheme for the purpose of tax evasion on what the Bureau described as a “particularly large scale”.

Other details include that the operator was not located at the address specified in its licence issued by national regulator KRAIL. In addition, the Bureau says staff concealed evidence, documents and other information needed to complete a full investigation.

As a result, UAH700m has been seized from the operator’s account. A pre-trial investigation is now taking place, with the Prosecutor General’s Office advising on the case.

While the Bureau stopped short of naming the operator, a report from The New Voice of Ukraine, citing Forbes, said that the company involved is Cosmolot. 

According to the story, Cosmolot stated that the charges are groundless and that it has already filed a complaint to the court contesting the charges.

“Cosmolot employees are involved only in the maintenance and support of the official website cosmolot.ua, which operates exclusively on the basis of an official licence,” the company said, according to the story.

Clamping down on illegal gambling in Ukraine

The case marks the latest step by authorities to tackle illegal gambling in Ukraine. Last year, several new laws came into effect while other meausres were proposed.

One new law outlines procedures for organisations subject to anti-money laundering and counter terrorist financing (AML/CTF). Coming into effect last July, the law means operators in the country now face more stringent inspections.

A month later, Ukraine also proposed preventing banks from lending money to self-excluded consumers. The proposed amendment to Ukrainian gambling laws would require lenders to carry out expanded checks.

There could also be a change in regulator in Ukraine, with the future of KRAIL up in the air.

Deputy prime minister, Mykhailo Fedorov, in May 2023 submitted draft law proposing KRAIL be dissolved and replaced with a new executive body. Fedrorov referenced the regulator’s ongoing failure to issue gambling licences in a timely manner.

KRAIL operates as a collegial body consisting of a chairman and six members. Meetings are only valid if five members are present, which is necessary for a licence application.

However, after the country’s invasion by armed forces of Russia, some Commission members were mobilised into military service. This made it impossible to continue KRAIL meetings and caused delays to regulatory work, including issuing licences.

Revenue for the 12 months to 31 December 2023 amounted to $1.96bn. BetMGM forecast between $1.80bn and $2.00bn for the full year, with several developments helping to drive growth.

In line with its business update in December, BetMGM says it remains on track to reach a positive EBITDA of $500m by 2026. This comes despite it expecting to post negative EBITDA of $67m for 2023.

Highlights for BetMGM in 2023 include key metrics for igaming and online sports betting improving year-on-year. Average monthly actives, first time deposits, hold percentages, bonus levels, net gaming revenue per active, and cost per acquisitions improved.

Continued expansion in North America

BetMGM was able to expand its presence in North America and is now active in 28 markets across the region. New launches in 2023 included Ohio, Massachusetts and Kentucky, all of which were online and retail, while it also rolled out online in Puerto Rico.

Further expansion is also on the horizon with a deal in place in North Carolina. BetMGM last month struck up a partnership with Charlotte Motor Speedway and set to launch in March, pending regulatory approval.

As for market share, BetMGM says it has a 14% sports betting and igaming share in the US. The operator also says it holds 22% of the market in Ontario in Canada.

“Our performance in 2023 demonstrates our commitment to delivering on our promises,” BetMGM CEO Adam Greenblatt said. “We were able to achieve strong organic growth, while executing against key strategic initiatives that lay the foundation for 2024 and beyond. 

“The attainment of EBITDA profitability over the last three quarters of 2023 validates the effectiveness of our business model and provides the basis from which to invest further in expanding our sports offering through the integration of Angstrom and leveraging our largely untapped Las Vegas omni-channel advantages.”

Following the BetMGM roadmap

On the subject of new development, BetMGM remains committed to the strategic roadmap set out in December. This includes technology, product and capability enhancements across its offering.

Last year, BetMGM executed single account single wallet across 21 markets in time for the 2023 NFL American football season. It also expanded sports betting with new markets and bet types and added more games to its igaming offering.

Looking to 2024, its plans include utilising Angstrom, the specialist sports data provider it acquired in July. This will be fully enabled come the start of the 2024 NFL season. The operator BetMGM plans to leverage Angstrom modelling to support products such as player-popular same game parlay (SGP), SGP+ and new LIVE SGP products.

BetMGM also committed to more personalised and differentiated gaming experiences, as well as more investment in marketing and player acquisition. In addition, BetMGM rolled out is new app last month, with this now live in Nevada.

“With this comprehensive roadmap in place, we can focus on driving accelerated player acquisition and retention and strengthening our current market position,” Greenblatt said. “This clear strategic direction underpins our confidence in achieving our targets and building long-term, sustainable value for shareholders.”

What about the UK?

Interestingly, the update does not make reference to the launch of BetMGM in the UK. Back in August, BetMGM went live in the UK market to much fanfare. However, the venture does not include Entain, with MGM choosing to work with its LeoVegas business – to much success, according to UK director Sam Behar.

In the wake of this, Greenblatt insisted BetMGM still represents a “strategic limb” of Entain and MGM. He highlights Entain’s support as evidence of the endorsement. Incidentally, MGM saw an £8.10bn bid for Entain rejected in 2021.

Back to 2023 and issues impacted the wider group, specifically MGM. In September, MGM was hit by a cyberattack that forced it to shut down systems across its US properties.

MGM Resorts CEO Bill Hornbuckle said MGM had been to “hell and back”, losing $100m in revenue after the breach.

The Esports Betting Conference, Street Gaming Hub and the contribution of women to global gaming were explored on the final day of ICE 2024.

Light & Wonder says the arrangement will help accelerate growth and scale up operations in markets worldwide. The group did not disclose how much the investment is worth.

The investment builds on an existing relationship between Light & Wonder and Flows. 

Flows uses automation software to support businesses with development and integrations. Light & Wonder said its investment will accelerate Flows’ own development and allow for faster product roll-out in new markets.

The investment comes after Flows recently launched a new voice-activated tool. This uses voice or text activations to build omni-channel jackpots from speech or text. 

‘Logical step’ for Light & Wonder

“Having witnessed the power of Flows’ world-class technology through its network jackpots feature, it was a logical next step to invest in its dynamic platform,” Light & Wonder igaming CEO Dylan Slaney said.

“Flows’ platform is an essential resource for businesses across all sectors of the igaming industry and beyond. We are delighted to offer the company our support and backing.”

Flows CEO James King added: “With the backing of Light & Wonder, we can expedite our path to becoming a worldwide leader in codeless automation solutions. Their support will act as a catalyst, supercharging our growth and innovation across the board and accelerating our mission of making technology accessible and transformative for businesses everywhere.

“I’m incredibly excited for the journey ahead and the unparalleled opportunities this will unlock for Flows and our customers. Kudos to our team who have worked so hard to build Flows up to the business it is today.”

Reshaping and refocusing igaming at Light & Wonder

The deal comes after Slaney last month spoke with iGB about his time heading up igaming for Light & Wonder.

Slaney only joined the industry in October 2017 but has rocketed up the gaming ladder. He began as executive vice-president of gaming at NYX Gaming Group but soon became part of the Scientific Games when it acquired NYX.

From here, he progressed to senior vice-president of gaming at SG Digital. Scientific Games then went through a major overhaul, divesting its sports betting and lottery divisions. It also carried out a high-profile rebrand. 

Light & Wonder emerged from this process as a more focused gaming business across three divisions: land-based, social casino arm SciPlay and iGaming. Overseeing the latter, Slaney reports to group chief executive Matt Wilson. 

Supplier Games Global agreed to acquire the assets from Super Group exactly one year ago today (7 February). Financial terms of the deal are not public.  

Games Global says the purchase marks a significant milestone for the business and will help with its US launch. This includes allowing it to immediately work directly with operators in the country.

DGC B2B is active in several US states including Pennsylvania, Iowa, New Jersey, Arizona, Colorado, Indiana, Virginia, Ohio and Louisiana. 

Super Group only purchased the business, which owns the rights to the Betway brand in the US, in January 2023. It originally agreed terms on the deal back in January 2022.

Games Global remains a relative newcomer to the market, however it has a network of 40 exclusive studios. It also has a collection of more than 1,300 proprietary games in addition to a wide-reaching progressive jackpot network.

US move key for Games Global

“We are excited about the successful acquisition of DGC B2B,” Games Global CEO Walter Bugno said. “It enables our immediate entry into the fast-growing US market and aligns seamlessly with our vision to become a leader in the global gaming industry. 

“This move not only strengthens our global position, but it also allows us to further innovate and deliver incredible experiences to operators and their players.”

Super Group CEO Neal Menashe adds: “We are pleased to have brought this sale to a close. Going forward, our team can continue focusing on our global B2C growth. 

“Games Global is a valued long-term partner of ours, and DGC’s B2B division is in good hands. We wish them all the best.”