Hard Rock pushes the button (again) on Florida OSB
Florida relaunch, affiliate M&A, GAN sale, Red Rock earnings +More
Hard Rock relaunches OSB in Florida.
Affiliate M&A bandwagon continues with GiG’s deal for KaFe Rocks.
GAN sold to Sega Sammy.
Red Rock the delayed Durango opening will be worth the wait.
Florida OSB
Hard Rock Bet has relaunched OSB operations in the Sunshine State.
You must remember this: Floridian consumers who previously signed up to Hard Rock Bet during the month-long window when the app was previously available in 2021 or who are Hard Rock loyalty program members are once again being invited to place their legal bets in the state.
In somewhat typical fashion, Hard Rock announced the move via a posting on X.
Hard Rock’s owners, the Seminole Tribe, did not confirm to local media when the full launch would take place.
The move follows the announcement last week that the Seminole would open up retail operations in its six properties in early December.
Let that be an end to it: The relaunch of OSB operations comes despite the ongoing lawsuit over the legality of the compact, which is currently in front of the US Supreme Court. After more than two years of legal to and fro, yesterday’s move would suggest the Seminole believe they are set to win the case against West Flagler.
New York casino
Meanwhile, in Gotham: Steve Cohen, owner of the New York Mets, has released plans for an $8bn entertainment park including a casino and hotel to be situated in the parking lot at the Met’s Citi Field. The casino would be operated by Cohen in partnership with Hard Rock.
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Affiliate M&A
Rock the record: GiG confirmed ahead of this morning’s results it has snapped up fellow gaming affiliate KaFe Rocks for €15m upfront, with a further €20m to be paid in four instalments over the next two years with an earnout element included.
KaFe Rocks is expected to generate revenues of €23m in 2024 and an adj. EBITDA margin of 45%, equating to ~€10.4m and giving the deal a multiple of ~3.6x.
GiG said that, via this deal, its soon-to-be-devolved media division would “cement its position as the dominant lead generator within the lucrative online casino market”.
GiG has a number of flagship brands, including US-facing Time2play.com and USCasinos.com.
The big mo: Following on from Tuesday’s news about Better Collective’s €176m deal for Playmaker Capital, it means the affiliate M&A ball keeps rolling. While Better Collective has now made five transactions this year, GiG itself late last year bought for €45m – and has since revived – the AskGamblers brand from Catena Media.
GiG’s Q3 earnings
The KaFe Rocks news came ahead of GiG’s Q3 earnings, which saw revenues rise 39% YoY to €31.8m, of which 23% was organic growth. EBITDA rose to €23.4m, helped by the reversal of an earnout provision. Ex-that provision, EBITDA rose to €13.6m.
Media division revenues rose 49% to €22.5m, augmented by the AskGamblers acquisition. Organic growth was 23% and adj. EBITDA came in at €10.4m.
Platform and sportsbook revenues were up 20% to €9.3m, with adj. EBITDA nearly doubling to €3.2m.
GAN sale
Life and times: The short and eventful life of GAN as a US-listed entity has been brought to an end after debt-holder Sega Sammy Creation announced a deal to acquire the business for $108m. The price represents a 120% premium to the closing GAN share price on November 7.
Sega Sammy agreed a $30m debt arrangement with GAN back in May.
Mountains into molehills: The deal brings to an end a tumultuous period for GAN during which it announced a strategic review, lost its analyst coverage and saw the departure of former CEO Dermot Smrfitt under a cloud.
Interim CEO Seamus McGill gave a rundown of what, in the company’s eyes, went wrong.
“Market share concentration in the US B2C space, a slower than expected adoption of regulated online gaming in the US, along with changes to key customer contracts, make the near-term operating environment challenging without ample capital resources,” he said.
⛷️ Up the hill and down the slope: GAN’s less than illustrious listed life
Durango delay
Good things come: Those waiting on the opening of the new Durango Casino will have to be a bit more patient after Red Rock said it was delaying doors by a fortnight to Dec 5. The news came as the company reported Q3 revenue down 1% to $408m with adj. EBITDA down in lockstep to $175m.
Love at first bite: On the Durango delay, CEO Frank Fertitta said “the most important thing is that the level of service on the day we open is at the highest quality that it can be”.
“The first impression is very important,” he added.
Valley highs: Scott Kreeger, president, added “there’s no one more bullish than us about the Las Vegas market”, with its long-term thesis about migration to Las Vegas very much intact.
“The fact is the people that are moving here have higher annual income than they’ve ever had in the past.”
“Not only are people moving here and getting wealthier, but the economy is getting more diverse.”
Earnings in brief
AGS: Revenue rose 14% to $89.4m with adj. EBITDA at $40.1m, up 16% YoY. On the call with analysts, CEO David Lopez said the recent G2E constituted a “coming out party” for the R&D team, suggesting the recent transformation of the company’s products “did not go unnoticed” by its customers.
“From new cutting-edge cabinets to a thoughtfully curated portfolio of diverse slot content, new table game concept and a turbocharged interactive offering, our booth truly had it all,” he told analysts.
Melco Resorts: Q3 revenues rose over 300% to $1.02bn, reflecting the improvements since the start of the year, the relaxation of pandemic-era restrictions in Macau and the opening of phase 2 of the company’s Studio City project. Adj, EBITDA rose to $281m from $34.9m this time last year.
Accel Entertainment: Revenue was up 8% to $288m while adj. EBITDA rose 7% to $44.1m, as the company saw the number of locations for its gaming terminal rise 5% to 3,687. CEO Andy Rubenstein said the “consistent growth in the face of uncertain economic times is a testament to the resilience of our business model”.
He added the company continues to evaluate the potential for expansion beyond Illinois’ borders.
EveryMatrix: The sports-betting and iCasino supplier said Q3 revenue rose 62% to €27.2m, while EBITDA soared by 113% YoY to €14m. EBITDA margins were above 50% for the second straight quarter.
Over the quarter the company went live with Bet-at-home and the Hungarian lottery’s sports-betting brand.
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Newslines
Sportradar will provide its player account management and sports-betting solution to the RLJ Companies’ Caribbean and South American route operator Caribbean Cage.
Pro League Network has partnered with the US Carrom Association to develop and launch the Pro Carrom Tour in the US, and hopes to have the tabletop game approved for sports betting in select states early next year.
Calendar
Nov 8: Everi, Full House, MGM Resorts
Nov 9: Flutter, Light & Wonder, Bragg, Super Group, Wynn, Century
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