Strategy – Page 10

November 17, 2022

MaximBet ceases operations amid “challenging” macroeconomic conditions

Online gambling operator MaximBet has ceased all operations with immediate effect citing “challenging macroeconomic conditions” and an “increasingly cost prohibitive marketplace”.

MaximBet announced the decision in a message to customers, saying they will have until 15 December to withdraw any funds in their accounts. After this date, any remaining balances will be refunded via cheque sent to the address on the account.

Players are no longer able to deposit more funds or place net bets, but MaximBet said that it would settle any existing bets in line with its MaximBet House Rules until 15 December. At this point, MaximBet said bets will be cashed out at “current fair value market pricing” and player balances will be returned via cheque.

MaximBet was founded in April of 2021 through a collaboration between sports betting operator Carousel Group and media brand Maxim, supported by a $50m investment from the xSigma subsidiary of Chinese engineering business ZK International.

At the ti..

November 15, 2022

SportNation and RedZone to cease trading in UK

Esports Entertainment Group (EEG)-owned brands SportNation and RedZone will cease trading in the UK from 30 November 2022.

SportNation and RedZone both said the sites were “closing for a variety of reasons including the economics of operating a small igaming business in the UK market”.

Users will be able to place bets and use their accounts will normal functionality until 30 November – after which they will be able to login to withdraw funds from 7 December, when the final closure is due to take effect.

Following this, there will be another seven-day period where the operator will process requests to withdraw funds of any amount over £1. From 14 December, SportNation and RedZone stated that “should any customer balances remain, we will continue to comply with requests for refunds of such balances to the extent required by law and in accordance with our terms and conditions”.

The operator has said that it intends to keep possession of customer data for five years following the clos..

November 9, 2022

Flutter CEO: Gambling Act white paper likely pushed back to 2023

Flutter chief executive Peter Jackson said that he thinks that the Gambling Act white paper is most likely to be delayed until next year, as he suspects new ministers will wish to “make their mark” on the document.

Speaking at Flutter’s Q3 earnings call, Jackson said he could not predict the the Gambling Act white paper timeline with any confidence, given that its release had repeatedly been pushed back by personnel changes in government and at the Gambling Commission. However, he said he would think its release was more likely to be in 2023 than this year.

“I don’t know if I can really comment on timing because I’ve tried to comment for the last two years and keep getting it wrong, so I might have lost some credibility there,” he said. “But I suspect it’ll end up coming out after Christmas as there isn’t much time now before Christmas.

“The new ministers I think will want to make their mark on it.”

Gambling Act review delays

The white paper is the next phase in the Gambling Act r..

November 9, 2022

Flutter revenue up 31% in Q3 as US becomes largest market

Flutter Entertainment forecast a 31% year-on-year increase in revenue for the third quarter of its 2022 financial year, primarily due to growth within its US and international businesses.

In a trading update, Flutter said that revenue for the three months to the end of September is expected to amount to £1.89bn (€2.17bn/$2.18bn), which would be a significant increase from £1.44bn in the corresponding period last year.

On a constant currency basis, revenue is forecast to increase by 82%.

Flutter said it expects this to be driven by growth within the US, where its revenue is forecast to rise 114% year-on-year, or 82% on a constant currency basis, to $598m, making it Flutter’s largest market.

This, the group said, was down to a 106% rise in sports revenue – comprising sportsbook, exchange, daily fantasy sports, advance deposit wagering and B2B product verticals – driven by customer acquisition across existing states as the new NFL season began.

US igaming revenue is also expected t..

November 7, 2022

Analysts divided on potential value of FanDuel IPO after court ruling

Analysts are divided on the value that may come from a potential FanDuel IPO, after a court ruling left the hopes of a potential spin-off for the US market leader up in the air.

The reactions come following a New York court ruling that media giant Fox must pay $4.16bn if it wishes to acquire a 18.6% stake in FanDuel, which is owned by Flutter Entertainment

While the court ruling settled the question of the value of the stake that Fox had the option to buy, it left the question of a FanDuel spin-off up in the air until next year. The tribunal will determine early next year the conditions under which Fox may be able to participate in a FanDuel IPO, which Flutter had raised the prospect of before the legal dispute began.

Analysts at Barclays said that this factor was “dampening the enthusiasm” of the main ruling.

“The path to a FanDuel IPO is not yet clear with Fox stating that ‘Flutter cannot pursue an IPO for FanDuel without Fox’s consent or approval from the arbitrator’,” Barclays ..

October 27, 2022

Kindred still committed to US, but won’t break even until at least 2026

Kindred chief executive Henrik Tjärnström said the operator does not expect to break even in the US states where it is currently active until 2026, but that it would nonetheless remain committed to the market.

During an earnings call following Kindred’s Q3 results, Tjärnström offered an update on Kindred’s performance in the US market. Here, he said the business hoped to break even by 2026.

“We are now live in seven states,” he said. “We’re going to reduce that to six when we leave Iowa and then increase it again to seven with Washington.

“We have been in an investment position across our state footprint and it will take some time, a few years to achieve profitability.

“We’re expecting the contribution from 2022 to be negative from 2021, but then in 2023 we’re reducing those losses and by 2026 we’ll be breakeven across our current state footprint.”

Last week, FuboTV became one of the highest-profile operators to exit the US market, highlighting the difficulty in turning a profit ..

October 27, 2022

Kindred set for strong Q4 as Netherlands “exceeds expectations” in Q3

Kindred said it is “exceeding expectations” in the Netherlands and expects rapid revenue growth in the final months of the year, after reporting its first quarter of revenue since reentering the market.

In Q3 of 2021, Kindred reported revenue of £277.8m, which was down by 6.9% year-on-year. Almost all of this revenue came from B2C operations, at £271.9m, while B2B revenue – from Relax Gaming – was £5.9m.

The decline in revenue continued to be down to the operator withdrawing from the Netherlands at the start of Q4 2021. While the operator returned to the country during the quarter, generating revenue again, the amount Kindred took in was less than before the country regulated, as was expected.

Kindred said it was “exceeding expectations” with 137,000 active Dutch customers, and brought in around £400,000 per day since launching on 11 July. Chief executive Henrik Tjärnström added that the business had around a 15% market share in the country.

“Thanks to our strong brand awareness, u..

October 26, 2022

Catering to the next generation

Tom Waterhouse’s latest betting investment column examines social betting, which he sees as a key way to engage younger audiences.

As discussed in our January 2022 newsletter, wagering apps have maintained a consistent information architecture for decades, typically structuring their layout by featuring promotions at the top, then providing some high level navigation to the most popular sports and major racing codes.

We have a particular focus on companies that are revolutionising this traditional user interface and the broader user experience. In January, we discussed Voxbet, a voice and text to bet business, which bettors can use directly through Viber, Telegram and other popular messaging services, thus circumventing the need to bet through a bookmaker’s website/app.

Social betting

Another way that bookmakers can appeal to a younger, digital-native generation of bettors is by promoting the social aspect of betting.

Bettors have always discussed their top picks with their frien..

October 26, 2022

Ontario report

iGB’s new report on Ontario offers exclusive insight into Canada’s most populous province – the first to regulate betting and igaming.

When the Ontario market opened in April this year, it wasn’t quite brand new ground.

Anyone in the industry could tell you that the grey market in Canada’s largest province had been thriving for quite some time.

Still, bringing the province from grey to white offers certainty and new opportunities for many.

Six months on, we have a sense of the spoils available. Operators – excluding the lottery – brought in a combined CA$267m in the three months ended 30 September.

The biggest challenge in the province, however, may be marketing rules. Operators can offer bonuses, but may not promote them. As Marese O’Hagan writes in our progress report, that’s been difficult, but it hasn’t seriously dampened excitement about the jurisdiction.

And for now, those complying with the rules still need to compete with some unlicensed brands, which continue to do busin..

October 25, 2022

American Gaming Association CEO on the rebirth and renewal of US gambling

Bill Miller could argue that his tenure has seen the most transformative period for the gaming industry since the American Gaming Association was established in 1995. He talks to Robin Harrison about sports betting, gaming expansion, Covid-19, safer gambling and the illegal market in this exclusive interview.

When Bill Miller took charge of the American Gaming Association (AGA) in January 2019, the US commercial gaming industry was poised for a period of explosive growth.

Legal sports betting, thanks to the repeal of the Professional and Amateur Sports Protection Act (PASPA), was rapidly spreading across the US.

The industry as a whole posted its fifth consecutive year of revenue growth for that year, with 2019’s total breaking records at $43.6bn.

The industry generated $10.2bn in gaming taxes for state and local governments with 21 of 25 commercial gaming states posting year-on-year revenue growth. This sum covers annual education costs for 832,000 elementary and secondary scho..

October 13, 2022

Nygaard-Andersen: Interest rates won’t stop Entain from acquiring

Entain chief executive Jette Nygaard-Andersen has said high interest rates will not stop the business from making new acquisitions, and may even “open up new doors”.

Nygaard-Andersen spoke on an earnings call after Entain published a third-quarter earnings update. Revenue was up 2% year-on-year for the group, thanks to both record customer numbers and a favourable impact from currency movements.

When asked whether the new macroeconomic environment and high interest rates would make acquisitions difficult due to the costs of borrowing money, Nygaard-Andersen said that this was not necessarily the case.

“We of course remain vigilant and very prudent,” she said. “But the health of the business remains good. We still have a strong pipeline on M&A and we have opportunities that we will continue to pursue.”

The results came after a busy period of acquiring for the business, with Nygaard-Anderson noting the business agreed nine acquisitions in the past 18 months, including those of Unikrn..

September 30, 2022

Light & Wonder completes $800m OpenBet sale

Light & Wonder has completed the sale of its OpenBet sports betting platform to Endeavor, three months after the initial planned closing date and for $400m less than was first agreed.

Endeavor – a sports media business that owns IMG Arena – will pay $750m in cash for OpenBet, plus 2.3 million Class A shares, worth $50m.

The sale forms part of a general streamlining of the Light & Wonder business, formerly known as Scientific Games. It also sold its lottery arm – which retained the Scientific Games name – in October of last year to private equity group Brookfield Business Partners.

The sale also follows the exit of Barry Cottle as Light & Wonder chief executive, with Matt Wilson serving in the role on a temporary basis until a full-time replacement is found.

Wilson said the new business can now focus on growth, now that it has a more clear focus on gaming, whether land-based, online or social.

“With the completion of the OpenBet divestiture and our now streamlined organisation, Li..

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Tag: Strategy