Bally’s shuffles the pack

Bally’s Corp results, Betr buys FansUnite source code, IGT’s instants success, Genius nears true profitability +More

Earnings+More

May 09, 2023

Good afternoon. On today’s agenda:

Bally’s sees more changes at the top.
Betr snaps up FansUnite platform source code.
IGT up on “phenomenal” lottery sales in Italy.
Genius, Full House and Century in earnings in brief.

Just gonna have to be a different one.

Bally’s all change

Bally’s announces more management moves as revenues rise 9%.

Ch-ch-ch-ch changes: Bally’s results were dominated by changes at the top of the company, with EVP and CFO Bobby Lavan stepping down and being replaced by Marcus Glover. Also joining as SVP of finance and corporate treasurer is Charles Diao, with Jaymin Patel named as the new vice-chairman of the board.

Windy City IPO: The group also filed a draft registration to list the River West resort it is currently building in Chicago and offer shares to city residents.

Lavan said the group had already made clear it wanted to IPO 25% of the value of the Chicago project and would evaluate the move once it was up and running.
He added that the resort was expected to generate $50m of EBITDA in 2024.

Mind the gap: In North America interactive losses were $10.5m and Lavan said he expected the group’s OSB vertical “to close the gap” on rivals towards the end of 2024. Total revenue rose 9% to $599m while adj. EBITDAR was up 10% to $158m.

The Kambi-powered OSB relaunch is set for the end of the year across Bally’s digital and retail estate.
Recall, Bally’s announced last week it was scrapping its in-house efforts to move third-party provision.
He added that the vertical’s performance would depend on how much “we are willing to invest in customer acquisition, which as of right now we are looking at being very conservative”.
Speed merchant: CEO Robeson Reeves said the biggest opportunity would revolve in combining retail and interactive capabilities.
“I see that as a pure accelerant to bring all of our operating businesses together,” he added.
The new OSB system will switch financial terms from a fixed to a variable cost model, with costs coming in at around the mid-teens of NGR.
Try before you buy: “Everything is going to be performance-based,” he added. “Our structure is now in the right place and we can actually rent before we have the option to buy.”

I can see clearly now: The UK grew 9.6% and, with ex-US interactive generating $246m in revenues, Reeves said the publication of the UK White Paper on gambling reform had provided the sector with much-needed clarity.

In terms of operational impacts, he said “changes are likely to only occur to the proposition that we deploy in the UK in 2024” and he expected low single-digit impact to revenues.
Constant clarity: “I've said many times that the only way you can solve growth is by knowing all your variables in a formula and having a few constants. We've been provided with those constants and we have clarity.”

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Betr buy

The micro-betting-focused operator buys the source code to FansUnite’s OSB platform.

Betr off: FansUnite has sold the source code for its Chameleon gaming platform to existing PAM client Betr, the micro-betting specialist. FansUnite will retain the use of the platform and source code and will have the ability to further sell the source code to other buyers in the future.

The source code deal follows on from FansUnite’s sale of its McBookie business for C$5m last week.
Speaking to E+M for today’s Deal Talk, CEO Scott Burton hinted at further sales and partnerships.

IGT beats

Elevated lottery revenues and domestic gaming demand boost Q1.

This old house: Gambling operators had reported “very strong” Q1s thanks to “slot machines in particular” and there were “a lot of old machines out there in need of replacing”, said CEO Vince Sandusky.

IGT also benefited from boosted lottery sales helped by “phenomenal” instant ticket sales in Italy, according to CFO Max Chiara.
He said the segment had been helped by a strong pipeline of new games launched in Oct-Nov and the easing of Covid worries.
Group revenues were up 3% YoY in constant currency to $1.1bn in Q1, with adj. EBITDA rising 7% to $449m.
Ex-the sale of the PostePay payments business, lottery revenues were up 4% to $624m. Gaming revenues were up 19% to $99m.
PlayDigital was up 20% to $55m, helped by the ongoing contribution of casino games provider iSoftBet.

Analyst takes: B Riley noted that the leverage of 3x was the lowest in IGT’s history. Jefferies added that it was a “prominent positive”.

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Earnings in brief

Genius Sports: The sports-data provider is “within touching distance of real profitability”, according to the analysts at Regulus, after the company reported revenues of $97m, up 19% YoY, and adj. EBITDA in positive territory for the first time at $8m.

The company raised FY23 guidance to $400m from $391m and adj. EBITDA to $49m from $41m.

Full House Resorts: CEO Dan Lee said Full House “comfortably exceeded” expectations after a debut contribution in Q1 from the newly opened Temporary in Waukegan, Illinois. Revenues were up 21% to $50m with adj. EBITDA up 21% to $10m. Lee said the Temporary was the “star of the show” even after only one and a half months of operations.

He noted that with the opening of the Temporary and the Chamonix in Colorado – planned for just after Christmas – Full House would go from being “one of the most levered gaming stocks to likely becoming one of the least levered” in the space of just three quarters.

Century Casinos: Revenue rose 5% to $109m while adj. EBITDA was up 9% to $26m. Post-close the company completed its Nugget Sparks acquisition for $100m.

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Calendar

May 9: Light & Wonder, Wynn Resorts, AGS
May 10: Sportradar, Everi, Golden, NeoGames, SBC North America
May 11: Codere Online, NeoGames call, SBC North America

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