Asia gains the driver for Evolution
Asia gains the driver for Evolution
Breaking news: UK White Paper, Evolution’s mixed message, Churchill Downs earnings, Rivalry new cash +More
Good morning. On today’s agenda:
Breaking: UK government set to release White Paper on gambling.
Evolution pledges to push on with RNG despite growth stalling.
LatAm and Eastern Europe key drivers for Betsson.
Churchill Downs sees historical horseracing machine benefits.
Rivalry boosted by C$10m of new investment.
He's never early, he's always late.
Breaking 1: UK White Paper
The UK government is set to release its White Paper on gambling. Among the predicted highlights:
A mandatory levy of 1% on GGR to fund the treatment of problem gamblers.
New £2 limit on slot play for under-25s; £15 limit for older players.
Gamblers who lose more than £125 a day will face financial vulnerability checks.
Those who lose more than £1,000 a day to face more extensive affordability checks.
Checks will also apply to those who lose more than £2,000 over 90 days.
For more, go to the Compliance+More White Paper special, which will be released later today.
Breaking 2: Flutter to vote for US dual listing
All those in favor: The Flutter AGM is being held today where it is expected that shareholders will vote to enable the company to seek a dual listing in New York in the coming months.
Evolution futurecasts
CEO says iCasino sector can’t stand still and wait for the future to happen.
Perpetual motion: Martin Carlesund, CEO at the leading live casino provider, said the iCasino space couldn’t afford to sit back and wait for the customer of the future to come to them automatically.
“We need to be relevant for the players 10 years from now,” he added. ”Delivering the same as today in 10 years will not be satisfactory.”
He was speaking after the company showed revenues rising 32% to €430m while EBITDA was up 31% to €300m, equating to a margin of 70% and driven by live casino where revenues rose 36% to €360m.
RNG was up 12% YoY but fell 4% QoQ to €69.5m and pro forma growth was <1%.
Carlesund said the company would redouble its efforts to achieve its targeted double-digit growth for RNG with an increasing space of releases in the remainder of this year.
CFO Jakob Kaplan noted the company had not set a time limit on that goal and repeated that developments in RNG “would not be linear”.
He said he did not see a “quick turnaround” in the next two quarters.
LatAm breakout: A demonstration of the growing importance of Latin America comes from Evolution’s new geographic breakdown, which splits the region out for the first time. For Q1 it represented 7% of total revenues or €30m, up 75% YoY.
The main driver of growth in absolute terms was Asia where revenue rose 49% YoY to €154m. The Europe region was up 14% to €174m and North America was up 56% to €57m.
Carlesund said the Asian growth came from market share gains “simply because we have a better product”.
The company noted that 40% of revenues came from regulated markets.
Slowly, slowly: Asked about why the company was only predicting slow penetration of live casino in North America, he said “it takes a while” for customers to get to know the product. “You need to be comfortable,” he added.
Happy with that you’ve got: On M&A, Carlesund said the company was “very particular”, but he noted that the company had the “right product mix” for RNG.
🧐 Evolution falls nearly 4% in early trading
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DraftKings on stream
An ad-supported streaming service of its own podcasts is on the cards, says report.
In pod we trust: DraftKings is planning to launch a streaming service showing videos of its podcasts to be called DK Network, according to a report from Bloomberg.
Quoting a statement from the company, the report said the service will build on the company’s “expanded media footprint” and on “securing top talent and trusted personalities across sports media”.
All about the content: DraftKings previously acquired media company Vegas Sports Information Network (VSiN) and has a partnership with Meadowlark Media, a sports-media startup founded by former ESPN president John Skipper and former ESPN host Ban Le Batard. It also has a deal with podcast entity iHeartMedia.
Betsson’s world tour
Growth from Latin America and Eastern Europe are the Q1 drivers.
Worldwide: CEO Pontus Lindwall said Latin America and Europe drove the 30% growth to €222m, with EBITDA shooting up 62% to €54m during Q1. Revenues from Central and Eastern Europe grew 75% to €93.5m and were now the largest contributors of group revenues at 42%, with Croatia and Greece the standouts.
Latin America grew 23% to €45m and at 21% was just behind the Nordics (at 23%) in terms of revenue contribution,
Chile and Argentina were “developing well” and Brazil’s potential meant “we're willing to invest in the market going forward”, added Lindwall.
Nordic cool: Lindwall added that the group was still happy with the Nordics but had “cooled on marketing” in Sweden and had adapted its offering to comply with Norway regulations, which dragged down revenues from that market.
Western European revenues rose 22% to €27m, while RoW growth was 13% thanks to Betsson increasing its stake in the Nigerian bookmaker betBonanza from 25% to 60%.
Churchill Downs first look
HHMdinger: Live and historical horseracing led the way as the company saw revenues rise 53% to $560m, helping adj. EBITDA soar 73% to $223m. In corporate news, the company recently raised $600m via an offering of senior notes and announced a two-for-one stock split.
Quick takes: Truist analysts were “incrementally positive” after seeing the record numbers and beating consensus estimates. The team at JMP noted the “impressive” margin improvements.
Diary note: Churchill Downs will conduct an earnings call tomorrow BMO.
Rivalry reaches Pinnacle
Transformers: Rivalry announced a $10m investment from bookmaker Pinnacle and other gaming technology payments stakeholders as GGR rose more than threefold to $9m. CEO Steven Salz said the agreement with Pinnacle was a “transformative point” for the company.
Skin ’n’ bone: Salz said Pinnacle has been providing odds and trading services to Rivalry “for some time now” and had “skin in the game”.
He added that there was a 40% crossover rate between OSB and iCasino play, helping to negate eSports seasonality.
Net losses hit $12m, which included $6m of share-based compensation. Excluding those items, adj. net loss was $5m.
M&A lines
Tiide is high: Entain’s C$13m purchase of Sportsflare has got the go-ahead from Tiidal Gaming shareholders. Sportsflare is an esports-betting odds provider and Entain said previously it would augment its Unikrn esports proposition.
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Newslines
New York: Las Vegas Sands has finalized a lease agreement with Nassau County for the planned resort casino site at Nassau Coliseum.
Knock-on effect: Bally’s property in Twin River, Rhode Island, has suffered a downturn in betting activity due to the launch of OSB in Massachusetts, according to local media.
Lottery.com has resumed ticket sales for the Texas Lottery.
Betr has received approval from the Massachusetts Gaming Commission and plans to launch in April. Fanatics has also received approval and plans to launch in May.
Australian-listed BlueBet’s US subsidiary ClutchBet has been awarded a license by the Colorado Department of Revenue and is now live.
Calendar
Apr 27: Churchill Downs call, GLP earnings
Apr 28: E+M Weekender, GLP call
May 1: MGM Resorts
May 2: Caesars Entertainment
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