Month: March 2024

Flutter announced its 2023 earnings on Tuesday (26 March), with group revenue jumping by 24.7% to $11.79bn (£9.32bn/€10.87bn) compared to 2023.

Flutter’s US operations were the main driver in its 2023 success. Jackson states that, through FanDuel, Flutter is now in a market-leading position in the US.

Looking at US operations as a whole, net gaming revenue market share stood at 53.4%, up from 43.2% in 2022. FanDuel also acquired over 3.7 million new betting and igaming players in 2023, up 19.0% from the previous year.

Further adjusted EBITDA in the country was also $167m for 2023, a significant rise from the loss of $263m recorded in Flutter’s 2022 financial year.

It was also the first time the company has recorded a positive further adjusted EBITDA over a full year. Further adjusted EBITDA margin is also now in positive territory, up from -8.2% in 2022 to 3.7% in 2023.

On Flutter’s earnings call today (26 March), Jackson heaped praise on the company’s performance in the US, particularly in regards to igaming.

Chief financial officer Paul Edgecliffe-Johnson asserted that Flutter and FanDuel had been the number one online casino operator in the US market since January 2024.

“There is tremendous momentum in the business,” Jackson said. “I am delighted with what the team are doing.

“Some of the innovations have only just been deployed and we are excited to see where we can take the company to.”

FanDuel strength of product driving US success

Jackson believes it’s FanDuel’s offering that is attracting US customers to choose its services, as opposed to competitors such as DraftKings and BetMGM.

Jackson highlighted FanDuel’s products, such as its parlay offering, as a key driver of Flutter’s US success and something that allows it to capitalise on its strongest US periods of the year.

“Q4 and Q1 are real heartlands for us with the NFL and NBA coming to the fore,” Jackson added. “The quality of our parlay products helps us to stand out. We’re very pleased with our NGR (net gaming revenue) share.

“We actually offer the best prices to customers in the market and yet we end up with bigger margin because of pricing accuracy and parlay penetration. We are very pleased with the quality of our product.”

2024 M&A targets for Flutter

In September 2023, Flutter acquired an initial 51% stake of Serbian omnichannel sports betting and gaming operator for €141.0m. The agreement also states that Flutter has the opportunity to acquire the remaining 49% in MaxBet in 2029.

The move provided the company with access to the regulated Serbian market and supported its wider expansion plans.

When quizzed on Flutter’s future M&A strategy, both Jackson and Edgecliffe-Johnson were keen to emphasise that the company would only acquire businesses it felt were market leaders. Only then will Flutter deviate from its medium-term leverage target of 2.0x-2.5x net debt to further adjusted EBITDA, which it upgraded from its prior objective of 1.0x-2.0x.

Edgecliffe-Johnson declared: “If we see attractive acquisitions, we are happy to be flexible. We are trying to create as big a business as possible and that continues to be the case.

“The number one priority for capital in business is to acquire new customers. Capital that is genuinely surplus will be returned to shareholders.”

One of Flutter’s acquisitions that paid real dividends in 2023 was its 2022 purchase of Sisal, a leading online gaming and lottery operator in Italy.

Sisal accumulated revenue of $1.22bn in 2023, 43.4% of Flutter’s International sector, which is all other markets excluding the US, UK, Ireland and Australia.

“Sisal performed very well at converting land-based players to online,” Jackson outlined. “It was able to do that because of fantastic products and natural cross-sell journeys.

“There’s also a fantastic funnel of lottery players, a very attractive pathway, especially in a market with restricted advertising. It’s a great opportunity to cross sell.”

“Mixed bag” for rest of international

Despite success in Italy, as well as a 13.7% rise in UK and Ireland revenue to $3.05bn, Flutter’s Australia performance somewhat hampered its 2023 earnings, with Jackson conceding it had been a “mixed bag” for the International sector.

Australia was the only segment to report a decline in 2023. Revenue fell by 7.1% to $1.45bn, with Flutter noting headwinds to its Sportsbet operator despite stating it had 45% market share in Australia.

Jackson cited increases in regulatory restrictions and taxes, as well as the reduction of player spend in Australia dropping to pre-Covid levels.

It’s not all bad news for Flutter’s Australia exploits in Jackson’s view, however. He explained: “Clearly the business has come down significantly.

“We have a fantastic team in Australia who are developing great ideas we can use for the rest of the world. Parlays have developed off the back of what some of Australian team are doing, so they are helping globally.”

Chaired by independent board member Don Robertson, the committee will now consider all strategic alternatives. This could include the sale of the group or its assets, as well as a merger, financing and further acquisitions, or other strategic alternatives. 

Bragg said there is no timetable to complete the strategic review, nor have any decisions been made. It added that there can be no assurances any transaction will be completed.

The group said it will provide further updates in due course, with its management remaining committed to executing its strategy and business plan in the meantime.

Revenue growth in 2023

The announcement comes alongside Bragg publishing its results for the 12 months to 31 December 2023. Revenue in this period hit €93.5m, some 10.4% ahead of the previous year, with Bragg hailing the impact of new partnerships and market launches.

Bragg struck content deals with several major operators such as Betsson, 888/William Hill and PokerStars. The group also entered new markets through partnerships, including Mexico with Caliente and Italy with Microgame.

Alongside this, Bragg said it continued to grow its presence in existing markets with multiple new titles. The group highlighted the US, UK, Spain and Switzerland as particular areas of growth during 2023.

On this, CEO Matevž Mazij, who joined last August, praised the impact of Bragg’s ongoing strategic efforts. This, he said, focuses on being a content-focused igaming B2B provider and “meticulous” control over expenses.

“By continuously expanding our portfolio of higher-margin proprietary and exclusive third-party games to a wider range of new partners at an accelerated pace, we are well positioned for long-term growth in top-line revenue, gross profit and adjusted EBITDA, along with improved operating margins,” Mazij said.

Netherlands key for Bragg despite new challenges 

Breaking down the annual figures, it is clear that the Netherlands is Bragg’s core market by some distance. Revenue in 2023 amounted to €33.6m, down 8.9% from €36.9m in the previous year.

Bragg said it maintains its “dominant” position in the country with five customers for its player account management (PAM) systems. However, there was some reason for concern, reflected in the revenue decline.

Since July 2023, Bragg says challenges have arisen due to increased competition and new regulations. It also struck a new deal with Entain-owned BetCity in Q4, but this required renegotiating certain terms.

Elsewhere, Bragg said it continues to report growth in the Czech market and is exploring new opportunities for expanding with its PAM platform, content aggregation, player engagement tools and managed services in other international jurisdictions. Czech is reported as part of the Other segment, with revenue here up 27.3% to €8.4m.

Also in Europe, Malta revenue increased 22.6% to €17.9m, while revenue in Croatia was up 43.3% to €4.3m, Belgium 340.6% to €3.7m and Serbia 12.5% to €1.8m. 

What’s happening outside Europe?

On the international stage, Bragg also reported some level of growth. Curaçao is behind the Netherlands as Bragg’s second core market, with revenue rising 11.6% to €19.2m for 2023.

In the US, revenue also increased by 17.5% from €4.0m to €4.7m. Again, Bragg said this was helped by launching with new partners, growing its overall presence in the process. 

“The global distribution of our proprietary and exclusive third-party content is rapidly expanding, particularly among an increasing number of tier-one operators,” Mazij said. “We anticipate a further surge in the global adoption of these games in 2024. 

“Last year, we successfully launched a total of 29 new proprietary online titles worldwide, including 26 proprietary titles newly introduced to the European online casino markets and 15 proprietary titles newly introduced to the North American online casino markets. We expect to maintain or exceed this pace of game releases this year.”

Increased costs lead to $5.0m net loss

However, turning to expenses, spending was higher almost across the board. Cost of revenue was the main outgoing at €43.6m, up 9.8% year-on-year.

Other expenses of note include €50.8m in selling, general and administrative costs, a rise of 8.6%. This resulted in an operating loss of €777,000, which was an improvement on the €828,000 loss in the previous year.

However, interest and other finance charges totalled €2.1m, leaving a pre-tax loss of €2.9m, compared to €1.9m in 2022.

Bragg paid €910,000 in income tax and also noted €1.2m in negative cumulative translation adjustment. As such, net loss for the year reached €5.0m, wider than the previous year’s €1.9m loss, with higher costs offsetting revenue growth.

There was, however, some good news in terms of adjusted EBITDA, with this increasing by 25.6% to €15.2m.

Revenue dips in Q4

Bragg’s full-year results were not helped by a decline in revenue during the final quarter of the year. For Q4, revenue slipped 1.3% to €23.4m.

The group did not disclose full results for the quarter. However, it did reveal an operating loss of €431,000, compared to a €162,000 profit in 2022. Adjusted EBITDA also declined 23.7% to €2.8m.

Bragg did note that revenue and adjusted EBITDA were both higher than in Q3, while its operating loss was lower.

Bragg looking to the future

Looking to 2024, Bragg expects to report growth across revenue and adjusted EBITDA. For revenue, this is set to be between €102.0m and €109.0m, meaning a rise of 9.1% to 16.6%, with the midpoint being 12.8% higher.

In terms of adjusted EBITDA, Bragg said this will likely amount to between €15.2m and €18.5m. This would translate to an increase of up to 21.7%, while the midpoint of the range would suggest a 10.9% increase.

“Our strategic actions have positioned Bragg as an essential content source for leading international igaming operators, strengthening our groundwork for consistent and profitable development,” Mazij said.

“With confidence, we affirm our readiness with the appropriate strategies, financial strength and infrastructure to maintain our business momentum while executing initiatives that foster cash flow growth and generate added value for our shareholders.”

Svenska Spel’s case relates to Sweden’s duty of care, as outlined in the country’s Gambling Act, introduced in 2019. The penalty fee is the result of an investigation period between October to December 2021.

According to the report issued by Sweden’s state regulator, Spelinspektionen, the review has included, among other things, how the company handled the 10 customers who had lost the most money during the relevant supervision period.

In the eyes of the regulator, Svenska Spel failed to take sufficient measures to protect players against excessive gambling and help them to reduce their gambling when there was reason to do so.

Svenska Spel’s response

In responding to the penalty fee, the digital division’s CEO, Fredrik Wastenson, announced: “We take the Gambling Inspectorate’s decision to heart. The inspection period covers October to December 2021 and we have already addressed many of the views. We have a high level of ambition in the work with our gaming responsibility.”

The operator also drew attention to the need for greater clarity in the regulator’s approach to guidance and supervisory decisions. While it accepted the fine, the operator said that it did not share the authority’s assessment.

“Since the duty of care was introduced in 2019, it has become clearer how it should be interpreted through the Gaming Authority’s guidance and supervisory decisions.

“We have adjusted our work as the picture became clearer. We are constantly developing our work, our methods and technical ability. Not only to live up to the legislation but also our own high ambitions.” 

Since the 2021 supervisory period, the operator has highlighted its approach to developing greater responsible gambling frameworks. These include income checks on high-staking customers, as well as an increase in welfare calls.

“When it comes to how the risk of gambling problems should be assessed, we start from an overall assessment of the customer’s behavior which is based on evidence-based research, our own effect measurements as well as current legislation.”

In finishing, Wastenson concluded: “In its decision, the Swedish Gaming Authority makes a different assessment, which goes further than what can be deduced from the current regulations. We will now consider whether to appeal the decision.”

Mixed 2023 for Svenska Spel

Today’s news comes off the back of a mixed year’s earnings for Svenska Spel in 2023. For the 12 months to 31 December 2023, revenue at Svenska Spel amounted to SEK8.03bn. This was only marginally lower than the previous year.

At the time, Svenska Spel interim CEO president Erik Strand praised the operator’s “stable” performance during 2023.

Reporting at the time, Strand said that while revenue levelled off, this was positive, given the challenges facing the business. These, he said, include wider economic concerns, “zero growth” in the gaming market and issues facing Casino Cosmopol and Vegas.

On this last point, Svenska Spel also announced it is closing its Casino Cosmopol venues in Gothenburg and Malmö due to limited profitability. However, growth in other areas of the business, Strand said, places the operator in a strong position moving forward.

“We continue to be a successful business despite the challenges we face in the outside world, which is slowing down growth in the gaming market and increased inflation,” Strand said. “In 2024, we will continue to create sustainable gaming experiences that contribute to a better Sweden.”

Incidentally, Svenska Spel will soon be under new leadership, with Anna Johnson to take over as CEO. Strand is now serving as interim CEO after Patrik Hofbauer left the business at the start of the year. Johnson will become CEO in June, with Strand continuing in his temporary role until then.

Busy day for Spelinspektionen

Svenska Spel is the second company to have been fined by Spelinspektionen today, with the Swedish regulator also issuing a SEK300,000 penalty fee and a warning to Yggdrasil. The slots studio is alleged to have supplied gaming software to an unlicensed company operating in Sweden.

The regulator said it began its investigation on 16 January 2024, when it started to investigate websites being run by unlicensed operators in Sweden. It is understood that Yggdrasil was a supplier for one of these websites, according to Spelinspektionen’s decision outline.

This contravenes chapter 11, section 6 of Sweden’s Gambling Act. This section outlines that game software licensees must not provide software for anyone that does not hold a licence.

In response to the investigation, Yggdrasil said it had corrected the issue on 23 January 2024. It stated that the contravention had come about due to a breach in contract between itself and a retailer. Yggdrasil stipulated that it no longer “manufactures, supplies, installs or changes gaming software for players without the necessary licence”.

The regulator acknowledged that Yggdrasil complied with its order, but added that this is expected of all licensees.

The committee Wednesday (27 March) will likely vote on whether or not to increase the tax rate in the package of bills from 20% to 25%, eliminate promotional deductions for operators and change where funding is directed as Georgia sports betting legislation continues to be a hot topic.

But multiple sources on the ground in Georgia aren’t hopeful that the online wagering package will pass through the General Assembly with just three legislative days remaining.

House sponsor Marcus Wiedower said he would provide committee members with updated language that includes the tax increase, promotional deduction change and a new breakdown of how the funds would be spent, before that meeting.

Earlier versions of the proposals have been approved by the Senate, and Senate sponsor Bill Cowsert said Monday that he just wants House approval so the bills can be sent to conference committee.

Georgia’s general assembly is set to adjourn Thursday (28 March), meaning lawmakers now have three days to push the bill through the full house, and send it back to the senate or call a conference committee.

How to spend the money the key issue

The discussed package of bills — SR 579, a constitutional amendment that would send the decision to legalise to the voters, and SB 386, the enabling legislation — would make online sports betting legal and the state’s professional sports teams would be in the mix. During a hearing last week on the constitutional amendment, it was clear that lawmakers had not reached consensus on what legal sports betting in Georgia will look like.

Monday’s hour-long discussion was heavily focused on how funds from online sports betting would be spent in Georgia. As the bill stands, tax dollars are earmarked for the state’s HOPE (Helping Outstanding Pupils Educationally) merit-based scholarship program.

But committee members spent considerable time asking questions about whether or not funds could be directed to “fully fund” the state’s Pre-K program, school lunches could be included in the spend and if needs-based scholarships could be considered.

According to Cowsert, a Republican, the current text of the bill allows the “budget to decide” where exactly funds will be sent.

“This is the third version” of the bill, Cowsert said. “And there has been a different formula on where the money is spent.” Cowsert said that budgetary needs change each year. He also said that the bill can’t pass without support from the Democrats. A two-thirds majority is required to pass a constitutional amendment, and neither party has that majority.

The Republicans got a sports betting bill to the House floor in 2021 before Democrats pulled their support over a controversial voting-rights bill, and bills have not reached a chamber floor the last two sessions.

What about responsible gambling?

The committee allowed one member of the public to speak, Caroline York, a parent whose son is recovering from gambling addiction. She said her son got into trouble sports betting in North Carolina — where digital sports betting went live two weeks ago — and Colorado. York encouraged the committee to vote against the measures. In earlier hearings, the committee heard from religious groups encouraging the same.

Cowsert said that funds for responsible and problem gambling could be available, but they are not specifically earmarked in the bill.

Among the other questions from committee members is whether or not daily fantasy sports would be regulated. A bill that would have put a framework around DFS — which now operates in a grey area in the state — died in the general assembly on 1 March. Since the first wagering hearing in the House this year, lawmakers have been suggesting that it be included in the sports betting bills, but as yet, it has not been added.

The comments were in response to the news last week that Ohtani’s interpreter and friend, Ippei Mizuhara, was stealing from him to support a gambling habit.

“I have never bet on baseball or any other sports or have asked anyone to do that for me,”  Ohtani said in a prepared statement. “Up until a couple of days ago, I didn’t know this was happening. In conclusion Ippei has been stealing money from my account and has been telling lies.” 

Ohtani appeared with a new interpreter and did not take questions after the statement.

The man who owns baseball’s richest contract — he signed a 10-year, $700m deal with the Dodgers during the off season — was earnest, straightforward and direct in his comments. He did not mince words in calling his friend and interpreter a liar.

Secrets and lies in Ohtani sports betting scandal

Ohtani said that Mizuhara kept a “media inquiry” into the gambling from him. He said that Mizuhara told the  “representatives in my camp” that Ohtani had agreed to pay off his gambling debts.

 “All of this has been a lie,” Ohtani said during the press conference.

Mizuhara apparently told Dodgers representatives and members of Ohtani’s legal team in English about his misadventures. Ohtani was present at that meeting, and said that even though it was in English, he “understood what was going on and that something was amiss.”

Ohtani and Mizuhara met at a hotel right after that meeting, and during the private meeting, “Ippei admitted to me that he was sending money to the bookmaker using my account, and at that moment, it was an absurd thing that was happening and I called my representatives at that point.”

As soon as Ohtani learned what was happening, he said he contacted the Dodgers and his legal team, which recommended immediately going to the authorities.

Ohtani shocked by situation

Though Ohtani showed little emotion during the press conference, he said,  “I am beyond shocked, it’s hard to verbalise how I am feeling at this point. And the season is going to start, so I am going to get my lawyers handle matters from here on out and I am completely assisting in all matters taking place right now.”

The Los Angeles Times on 20 March broke the news that Mizuhara was accused of stealing from Ohtani and placing sports bets with an illegal bookie. Ohtani’s name came up during an investigation of Michael Bowyer, who is connected to a federal investigation into the illegal sports betting ring headed by former minor-league baseball player Wayne Nix.

Early on in the news cycle, Ohtani’s lawyers said that the superstar had paid off Mizuhara’s gambling debts, but shifted the storyline to say that Mizuhara had stolen from Ohtani.

Major League Baseball and the Dodgers announced that they immediately fired Mizuhara, who is accused of stealing millions to support a gambling habit. ESPN has reported that a total of $4.5m in wire transfers were sent from Ohtani’s account to the illegal bookmaking account.

On 22 March, MLB announced that it is opening a formal investigation into the sports betting scandal, even though Mizuhara is no longer employed by the league or the Dodgers, and Ohtani is not the target in the investigation.

In the course of the investigation into the Nix gambling ring, former Los Angeles Dodger Yasiel Puig was charged and has pleaded not guilty to illegal wagering.

When FDJ’s €2.45bn offer to acquire Kindred Group was announced in January, it seemed to come out of the blue.

But it wouldn’t have been a shock if you were familiar with FDJ’s 2020-2025 digital strategy, in which it committed to “diversifying its revenue sources”. This mainly focuses on bolstering its omnichannel capabilities and gaining a presence in new markets. In those contexts, Kindred feels like an answered prayer.

FDJ holds France’s monopoly for lottery, retail sports betting and scratchcards. As stated by the semi-public company itself, acquiring Kindred – one of the largest online gaming companies in Europe – will create “a European gaming champion”.

The French lottery operator hinted at seismic M&A plans during its Capital Markets Day in November 2022. According to Pallez, although Kindred may not have been in FDJ’s eyeline back then, this gave FDJ the opportunity to explain its reasons for seeking significant M&A opportunities.

“We explained why – based on the success that we have on our current businesses, which is lottery, of course, but also online betting and gaming – we thought that our strategy was to diversify and particularly to seize opportunities to become a truly international player,” she explains. “In this context, we’ve been looking at many opportunities that were present that could arise in our environment.”

And one such opportunity was Kindred. The acquisition process was only ramped up by Kindred’s confirmation of a strategic review – and potential sale – in April 2023.

Pre-emptive movements from FDJ and Kindred allowed FDJ to “enter into due diligence and to also enter into a direct dialogue with the management and shareholders of Kindred”.

Plans in place for some time

For a deal in the works as long as this one, it was bound to have a hefty price tag – €2.45bn to be exact.

This lofty valuation makes sense for what Kindred is bringing to the table. But it is still a whopping seven times more than FDJ spent acquiring Premier Lotteries Ireland (PLI) last year. PLI became the first foreign lottery operated by FDJ and has served to bolster its ambition to become an international B2C operator.

PLI is “a company that we know well, which has a lot of similarities with our lottery business that we exercise within exclusive rights in the French market,” Pallez explains.

“What we are doing is projecting ourselves as a group which is using its current experiences and assets to diversify and project this experience abroad.”

Pallez asserts that lottery will continue to be FDJ’s primary product offering, even after the Kindred deal has closed. But Kindred’s diverse offering, which spans slots, online gaming and sports betting, is not necessarily meant to slide into the lottery arrangement. Rather, it will give FDJ a whole new scope for operation.

“PLI is a way to use our experience on this segment of our activity and Kindred is definitely a way to increase and completely and drastically diversify our online and gaming business,” she continues. “Our strategy is to diversify and internationalise our activities.”

And it’s not just about reach. While Kindred has a significant presence in Europe, the quality of its products is also a standout feature for FDJ.

“Kindred is definitely one of the leading online betting and gaming operators, so it is a major asset to give us the necessary not only size, but also the necessary quality to be present in this online betting and gaming sector we have,” Pallez explains.

“We believe strongly that in order to be competitive and able to participate in the competitiveness and investment in this sector, you need again a certain element of scale and a number of critical assets.”

Fortifying FDJ’s presence in gaming

Kindred already has a significant presence in France through Unibet, one of its best-performing brands. And it’s making moves in technology and investments, too.

“[Kindred] is investing in a new sportsbook platform, KSP, which is one of the reasons we think Kindred also can bring a lot to us,” Pallez explains.

This particular investment by Kindred will be of keen interest for FDJ – it has just agreed to sell its B2B business Sporting Solutions, which it acquired in 2019. Forward-thinking investments coupled with a priority on responsible gaming was exactly the sort of thing FDJ was looking for.

“Kindred is best in class as an online betting and gaming operator in terms of responsible gaming,” Pallez emphasises. “We also believe strongly to be a sustainable and profitable operator in this business does require you to also to be best in class in terms of integrating responsible gaming within your marketing and relationship to your customers.”

A dynamic is forming here. Not only can Kindred offer FDJ its tried-and-tested brand success, but also a high potential for further growth – for example, in its sports betting and online gaming segments, where revenue grew 10.9% in 2023.

In the end, FDJ gets a stronger footing in the betting and gaming sphere.

“Highly complementary”

Pallez views Kindred as “highly complementary” to what FDJ already offers and it shows.

Considering France alone, things look to be a dead cert for FDJ and Kindred’s success in the market. But what about in the context of wider Europe?

It’s difficult to predict, Pallez admits. However, having an armoury of assets is a big bonus.

“Today the European market has been consolidating and is consolidating,” she muses. “If you want to be, in the medium term, a competitive player in this market you need to have the necessary size and quality of assets.

“I think Kindred will definitely create a European champion that will be able to be a part of this European market with the necessary size and quality.”

Kindred owns nine gaming brands, all of which are keen European players.

It’s not just about competing though. Snapping up Kindred creates an avenue for FDJ to implement two of its core principles – regulatory compliance and responsible gambling – on a wider scale.

“As we have announced, we will become the owner of the company [Kindred] and will operate it only in locally regulated markets,” Pallez explains. “Best in class in responsible gaming is also a major differentiation and major condition to be one of the leading operators in this domain.”

For a company as mammoth as Kindred, it’s fair to assume that planning a future as its new owner would be an intimidating task. But if Pallez is nervous, she doesn’t show it.

Focusing on diversifying FDJ’s reach and dedicating time and energy into Kindred’s further growth are priorities. Everything else will take care of itself.

Pullin will officially step down as CFO on 27 March. He has served in the role at BetMakers since October 2018. 

Prior to joining BetMakers, Pullin worked at businesses outside the gambling sector. These include White Cloud Capital, Duke Street, The Bank of England and KMPG Australia.

BetMakers did not disclose why Pullin had tendered his resignation. However, CEO Jake Henson praised his impact during five and a half years with the provider,

“We thank Anthony for his significant contribution to BetMakers,” Henson said. “Over the past five years, Anthony has been a valued senior team member, adding financial rigour to our business. 

“He leaves BetMakers in a strong position, with the foundations in place for the company to achieve profitability. We wish Anthony all the very best for his future endeavours, where I have no doubt he will be an extremely highly valued team-member.”

Van der Merwe takes interim CFO role

With Pullin set to leave, BetMakers has appointed Warrick van der Merwe as interim CFO. 

Van der Merwe has been group financial controller at BetMakers since August 2021 and previously led the Australian and group financial reporting teams reporting to Pullin.

Before his time with the provider, Van der Merwe worked in finance roles with a range of non-gambling companies. These include Edify Energy, Excite Holidays and, like Pullin, KMPG Australia. 

BetMakers said Van der Merwe will take temporary charge while it seeks a permanent replacement for Pullin.

BetMakers issues update on Punting Form

Alongside the resignation announcement, BetMakers published an update on its Punting Form business. The group acquired ABettorEdge, trading as Punting Form, for AU$20.0m (£10.4m/€12.1m/UA$13.0m) in November 2022.

BetMakers said the sellers of Punting Form have produced North American race and sectional data. These means they have satisfied a “special event” set out in the acquisition deal and are due an additional $3.0m.

The group will make an initial cash payment of $500,000 today (25 March). A residual $2.5m payment will be determined by the board and paid or issued within the next 10 business days.

Punting Form uses proprietary IP and artificial intelligence to create sectional times and benchmarks for horse racing, which are used for time-based ratings systems. Professional wagering syndicates, betting operators, content creators and form analysts use the service.

“This represents the completion of the initial consideration for the Punting Form business,” Henson said. “We are pleased with the development of the product as well as the underlying performance of the business so far. 

“Over the next 12 months BetMakers will further integrate the Punting Form asset into our core offering, including into the NextGen wagering platform.”

Revenue growth amid ongoing restructure in H1

This will come as more good news for BetMakers, which last month reported a 9.9% increase in revenue to $51.3m during H1. This came against a background of ongoing restructuring at the business.

In the first half, BetMakers said it focused on minimising its cost base. This also saw it renew its contracts and the signing of new customers.

Restructuring also allowed BetMakers to work on “streamlining the business model” across three segments – Global Betting Services, Global Tote and Corporate. This led to a drop in headcount from 456 to 414 during the six months.

BetMakers announced the restructuring scheme in May 2023 as a way to reduce costs. 

Star loses CEO and CFO

BetMakers is the second major Australian gambling business to lose a member of its senior team.

Last week, it was announced Robbie Cooke is standing down as group CEO and managing director of Star Entertainment Group with immediate effect. Christina Katsibouba will also exit as chief financial officer.

Cooke and the board consider a leadership change being in the company’s best interests Star explained. Chairman David Foster will take on additional duties as executive chair while a search for a permanent CEO is conducted.

Meanwhile, former Tatts Group CFO Neale O’Connell will be replacing Katsibouba on an interim basis.

Combined online and retail handle for February was 39.0% ahead of $197.7m in the same month last year. However, it fell short of the $346.3m wagered in January 2024, meaning the Louisiana market shrank for the second consecutive month.

Online betting accounted for $253.1m of all activity in February, with retail wagers reaching $21.7m.

Turning to revenue, for the market as a whole, this amounted to $25.1m. This was 30.7% up from $19.2m in February 2023 but 35.5% short of $38.9m in January.

Revenue from online sports betting totalled $24.3m, with retail’s share at $780,013 for the month.

As for tax, Louisiana generated $3.6m from online wagering and $128,140 retail betting.

Year-to-date handle exceeds $2.20bn in Louisiana

Looking at the state’s year-to-date performance, total handle for the eight months through to the end of February was $2.23bn. 

For this period, consumers spent a total of $2.03bn betting on sports online in Louisiana. A further $206.8m was wagered at retail sportsbooks across the Pelican State.

Turning to revenue, the year-to-date total amounted to $258.0m. Online betting accounted for $235.3m of this, with retail revenue at $22.7m.

The current Louisiana online market comprises 10 operators – ESPN Bet, Bet Rovers, BetMGM, Caesars, DraftKings, FanDuel, PointsBet, Betway, Bet365 and ClutchBet are all active in the state.

Bet365 and BlueBet-owned ClutchBet are relative newcomers, launching in November 2023 and January 2024, respectively.

The Rabbitohs and Bulldogs, both based in New South Wales (NSW), will not display betting ads during home NRL games. They will also continue to educate players, staff and fans about gambling risks.

This is in line with the NSW government’s Reclaim the Game initiative. Launched in 2020, the campaign stretches across several sports and encourages teams not to enter marketing deals with gambling businesses.

The Rabbitohs and Bulldogs have supported the programme for the past two years, displaying Reclaim the Game branding at all home games.

According to the NSW government, since forming the two partnerships, members and fans have shown a marked increase in awareness of GambleAware responsible gambling services. It said around one in three Rabbitohs and Bulldogs supporters are aware of the GambleAware website and helpline.

“NRL games draw huge crowds and receive extensive media coverage,” director of the office of responsible gambling in NSW, Alison Parkinson, said: “NRL is highly intertwined with betting advertising and sponsorships, increasing the risk of gambling harm among fans.

“The Rabbitohs and Bulldogs have been pioneers against the saturation of betting ads in the NRL. They are helping make their game days a family-friendly experience. Family traditions often shape support for a club. Attitudes towards gambling can also be passed down through generations.”

Ongoing support of adverts blocking scheme

The government adds that wider support of the programme has allowed the initiative to reach millions through more than 260 games. This includes on TV and for those inside stadiums.

Reclaim the Game now has 11 partners across five sports including the Australian Football League (AFL), A-League, cricket, National Basketball League and NRL. 

Other teams and organisation backing the programme include AFL team the Sydney Swans, A-League clubs Western Sydney Wanderers FC and Macarthur FC, as well as Cricket NSW.

“We are thrilled to extend our partnership with Reclaim the Game,” Rabbitohs CEO Blake Solly said. “Their commitment to being part of a positive social movement aligns with the values of our club. We are excited to continue working together to challenge the notion that gambling is a normal part of sport.”

Bulldogs CEO Aaron Warburton added: “Rugby league is one of the most entertaining sporting experiences. We firmly believe that our members and fans should be able to watch and enjoy this great game without constant advertising from sports betting companies.”

Potential betting advertising ban in Australia?

Gambling companies already face certain restrictions when it comes to advertising betting in Australia. Rules prohibit gambling ads during live sport between 5am and 8.30pm. This also applies to radio and streaming services.

However, there is still plenty of exposure in the country. More than one million adverts featured on Australian free-to-air television and metro radio in the 12 months to 30 April 2023. Some 50% focused on online operators.

Some broadcasters have introduced their own measures against gambling adverts. For example, Special Broadcasting Service allows customers to opt out of receiving gambling ads.

This could go further and Australia could face a complete ad ban. Last year, a parliamentary inquiry into online gambling recommended a phased ban across all media.

The House of Representatives committee on social policy and legal affairs inquiry into online gambling and its impacts on problem gamblers released a report that outlined 31 recommendations for reforming the gambling sector in Australia.

Among other measures, the committee advised a blanket ban on all gambling advertising on both broadcast media and online, that “leaves no room for circumvention”.

BTM Entertainment held a B2C gaming service licence from the Malta regulator. However, this approval has now been withdrawn.

The MGA ordered BTM Entertainment to settle all outstanding fees with the regulator within seven days of the cancellation notice. This is dated 22 March 2024. The regulator added that the decision could be subject to appeal.

Cancellation comes after BTM Entertainment was suspended several years ago in Malta. The operator had its licence held in early 2019, although the MGA did not disclose the reasons for this action. 

When the licence was active, BTM Entertainment operated the Roy Richie online gambling brand. This included fixed-odds betting and live betting services.

Rush Gaming stripped of Malta licence

BTM Entertainment is the second business in recent weeks to have its Malta licence cancelled. Earlier in March, Rush Gaming was also stripped of approval in the country.

As was the case with BTM, the regulator did not disclose why it had cancelled the Rush Gaming licence. The business was initially suspended in January, with the full cancellation coming just two months later.

Rush Gaming’s B2C gaming licence covered several gambling activities. These include casino, controlled skill games and fixed-odds offerings such as live betting.

The operator ran both the Fansbet.com and Onebet.com websites. It was ordered to notify all players of the cancellation and settle any outstanding fees.

Mizzi takes charge at MGA

There has been something of a flurry of cancellations since Charles Mizzi took over as CEO of the regulator. Mizzi replaced Carl Brincat in January, who stepped down after two years at the helm.

In addition to BTM and Rush Gaming, those also feeling the wrath of the regulator in recent months include Super7Plus, which lost its licence in January. 

Mizzi joined the MGA from Residency Malta Agency, where he served as CEO for five years. He also held other senior roles during his career including head of the image and communications unit at BNF Bank.