Financial News — Weekly Round-up for September 29, 2017

By Brian Cullingworth, Last updated Feb 3, 2021

Global Online Gambling Market Still Growing

Latest study predicts sector will be worth $81.71 billion by 2022

The online gambling global market is alive, well and still growing according to the recent “Global Online Gambling Market” study covering trends, forecasts and updates for the 2016-2022 period.

The research indicates that the sector will reach $81.71 billion by 2022, rising from $44.16 billion in 2016 at a CAGR (compound annual growth rate) of 10.8 percent, with sports betting and casino activity the top earners.

Other key points in the report include:

* The use of mobile devices for online gambling purposes is increasing;

* Over 80 nations have legalised online gambling in one form or another, and Europe has the largest online gambling market with further potential about to be realised when the Netherlands legalises.

* Growth in the Asia Pacific region has to some extent been stifled by government bans and interference;

* There is a strong possibility that more US states will legalise online gambling in the years ahead, motivated by the prospect of tax revenue;

* In Africa there has been little indication of legalisation outside of sports betting;

* Terrestrial gambling still dwarfs the online variety.

Finnish Gambling Sales Ease In H1-2017

Profit down 3.3 percent at gambling monopoly Veikkaus as sales ease

The Finnish gambling monopoly Veikkaus, formed earlier this year by merging Ray and Fintoto with Veikkaus (see previous InfoPowa bulletins), has reported a 0.5 percent y-o-y decline in first half 2017 online and land gambling sales at Euro 2.1 billion, and a drop in profits over the period of 3.3 percent to Euro 665.7 million.

On the positive side, CEO Olli Sarekoski noted that the registered player base now exceeds 2 million punters, around 67 percent of the nation’s adult gambling population. The new online facility proved especially attractive to gamblers, generating an average of well over half a million players a week, and improvements continue, he said.

The company is also planning the imminent launch of a new loyalty program designed around a chip-based card,

Sarekoski attributed the reduction in sales to an 8.2 percent decline in lottery action at Euro 764 million, brought on by smaller jackpots that discourage ticket buyers in two major products.

Overall slots and instant games delivered a 4.2 percent y-o-y increase in sales at Euro 801.6 million, whilst skill games action generated improved sales, up 5.2 percent at Euro 541.5 million.

Football pool sales rose 11.1 percent, and fixed odds gaming sales were up 16 percent.

Chinese Lottery Sales Remain Buoyant

13.1 percent y-o-y rise in August sales

Chinese sports lottery tickets again proved the most popular in August as sales rose 16.4 percent year-on-year, with welfare lottery sales also up, albeit by a less impressive 10 percent. .

The Chinese Ministry of Finance reported that overall lottery sales in August saw an increase of 13.1 percent to RMB 35.1 billion (US$5.3 billion), with sales especially strong in the provinces of Hunan, Fujian, Guangdong, Henan and Zhejiang.

Overall sales year-to-date have grown 6.3 percent to US $273.8 billion.

Game Account Network Reduces Losses

Irish “simulated gambling” company reports that revenues were up 6 percent in H1-2017

Online gambling technology firm Game Account Network (GAN) has posted its H1-2017 performance numbers, noting that it has managed to reduce year-on-year losses from GBP 2.3 million last year to GBP 2 million in 2017 so far.

Revenue over the half-year grew 6 percent y-o-y to GBP 4.1 million on the back of increased revenue share from the company’s core markets, Italy and the US. Recurring revenue grew 24 percent and now accounts for 86 percent of net revenue.

Business-to-business net revenue also increased slightly while business-to-consumer revenue remained flat.

Other highlights of the report included:

* Gross income up 17 percent at GBP 18.6 million;

* EBITDA of GBP 24,000 (H1-2016: loss of GBP 500,000);

Management reported that cost-cutting initiatives have been accelerated without compromising product quality or customer relationships, but that admin costs rose by GBP 100,000 in H1 when compared with 2016.

The company reported a cash balance at mid-year of GBP 3.3 million, slightly up on the previous half-year, and attributable to an unsecured convertible loan note issue which generated GBP 2 million for the company.

Forecasting performance in the second half of 2017, GAN Management is optimistic that demand for simulated gaming will increase, generating higher revenues following the launch of five new casino operators in the first half.

Further product development is also expected to generate revenues for the company’s new and existing operators.

“The group generated positive clean EBITDA in H1 2017 following a substantial multi-year period of investment focused on the US land-based casino Industry. We anticipate this favourable EBITDA trend to continue throughout H2 2017,” said Dermot Smurfit, the company’s chief executive.

“The first half of 2017 saw continued growth in recurring revenues driven by the launch of five new clients of Simulated Gaming and strong growth in real money Regulated Gaming markets in the US and Europe.

“As the numbers illustrate our group has now moved into sustainable profitability at the clean EBITDA level. Growth prospects for Simulated Gaming and real money Regulated Gaming continue to offer the Company a viable path to creating significant incremental shareholder value,” he concluded.


Brian Cullingworth

Infopowa news was a staple of Casinomeister’s news from 2000 until 2019. Brian Cullingworth was the main writer, contributor, and was one of the most knowledgeable persons I have ever known involved in the online casino industry.

We first met in January 2001 at the ICE in London where I observed him going booth to booth interviewing online casino, software, and licensing jurisdiction representatives. Brian was also heavily involved with our forum as “Jetset“, he was involved as an informal consultant to eCOGRA, the OPA, and was a player advocate who assisted countless aggrieved players with his connections to industry folks. He also published “Casino Cautions” via Infopowa news for quite a number of years. These can be found in our news archives.

His passing in February 2019 was a dark day for us. He will be forever missed.

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