Bally’s Corporation’s third-quarter trading report revealed consistent growth across most metrics, reflecting its successful efforts to adapt to rising industry challenges. The United Kingdom is emerging as an increasingly significant market for the renowned US gambling group despite the country’s ongoing regulatory changes. Such successful financial results should set the stage for further growth in the European market.

Recent Results Indicate Impressive Momentum

In an update to investors, the NYSE-listed company unveiled group-wide revenues of $632.5 million, marking a 9.4% year-on-year increase compared to Q3 2022’s $578.3 million. Bally’s International Interactive was one of the most significant contributors, reporting revenues of $243.9 million, a 7.2% rise from the previous year’s $227.6 million. The group’s UK operations were pivotal to this success, achieving a remarkable 13.1% increase.

Bally’s UK market share centers around the Gamesys Group, which the company acquired for over $2 billion in October 2021. This strategic move allowed the gambling giant to operate brands like Jackpotjoy, Virgin Casino, and Monopoly Casino. In September, Bally’s launched its branded online casino app, further bolstering its UK presence.

We believe that Bally’s brand will drive revenue and profit growth and build brand equity in the UK market.

Robson Reeves, Bally’s CEO

In a recent earnings call with investors, CEO Robson Reeves was confident that the company would sustain to exceed its current levels, hoping for even better Q4 performance. This quarter’s solid financials should allow the company to pursue growth opportunities in select international markets while reinvesting in its core UK and Asia businesses.

Flexibility Remains Paramount for Sustained Growth

Bally’s has maintained its impressive UK market share expansion despite the country’s ongoing regulatory changes. The UK Gambling Commission and the DCMS are currently engaged in consultations with stakeholders regarding the ongoing White Paper review. While more stringent affordability checks and KYC compliance requirements could impact revenues, Bally’s timely preparations allowed it to thrive.

Despite the company’s increasing focus on overseas projects, Bally’s maintains its leadership position in the USA. The gambling giant’s newest Chicago casino recently had a stellar debut, attracting over 80,000 visitors and generating approximately $6.7 million in revenue. Continued investments in promising projects across several states suggest that Bally’s will attempt to balance its core regions to achieve optimal results.

CEO Reeves was optimistic regarding the company’s long-term success, noting investments in its C&R segment should pay off in 2024 and bolster long-term profitability. Working within the UK’s tight restrictions has caused substantial innovation in customer onboarding and retention, reducing cost per acquisition and boosting deposit rates. These insights should benefit Bally’s other segments and help it stand despite rising competition.

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Leading betting and gaming group 888 Holdings has issued a cautionary statement to its investors, indicating that its Q3 performance may fail to reach initial expectations. The London Stock Exchange (LSE)-listed company remained optimistic that this downturn would remain temporary, expecting a swift recovery in 2024. This announcement closely mirrors that of Entain, signaling a potential industry-wide slump.

Negative Factors Compounded To Hinder Growth

The expected 10% Q3 drop should place 888’s quarterly revenue at roughly £400 million ($487.61 million). These results may indicate an unfortunate trend for the company as last year saw another 7% slump compared to 2021’s revenue of £484 million ($590.31 million). 888 attributes this negative trend to several factors, noting that the company remains positioned to overcome these challenges and emerge stronger than before.

Sustainability initiatives form one of the primary factors behind the projected revenue decrease. While this reflects the company’s commitment to responsible gaming, it impacted profits. Enhanced compliance measures in the UK similarly affected revenues in one of the operator’s primary markets. 888 cited ‘customer friendly sports results’ as another negative factor across all jurisdictions.

Compliance challenges are a running theme in the report, as the operator admitted that regulatory changes in dotcom markets resulted in the slower-than-expected recovery in customer activity and revenue. Furthermore, a shift in 888’s marketing strategy focusing on ‘higher return marketing’ resulted in temporary disruptions as the company adjusted to its new brand-led strategy.

The Company Maintains Its Leadership Position

Despite the Q3 revenue setback, 888 Holdings maintains a positive outlook. It expects improvements in the remainder of the year, with Q4 revenue projected to be sequentially higher than Q3, although still lower year-over-year by a mid-single-digit. 888 Executive Chair Lord Mendelsohn noted that the operator was making significant strides to improve long-term sustainability, lauding the team’s efforts.

We are strongly focused on investing to deliver good levels of expected revenue growth in 2024 as we progress towards our clear target of more than £2bn of revenue in 2025.

Lord Mendelsohn, 888 Executive Chair

888’s troubles closely mirror those of Entain, one of its primary competitors. The global gaming company cited slower growth in strategic regions and UK regulatory headwinds as the primary reasons behind the drop in projected revenue. These shared challenges could reveal insights regarding the wider gambling industry as many regulators reaffirm their focus on player protection, forcing operators to adapt.

888 is currently undergoing a leadership transition as Per Widerström prepares to assume the position of CEO. This change in leadership is part of the company’s broader strategy, which includes repaying loans related to the £2.2 billion acquisition of William Hill, achieving higher profit margins, and maintaining a net debt of less than 3.5x.

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Wynn Resorts, a prominent player in the global hospitality and gaming industry, released its second-quarter financial results, showcasing robust growth in both North America and Macau. 

Wynn Resorts Reports Strong Revenue Surge and Resilience in Macau Market

The company reported operating revenues of $1.60 billion for the second quarter ended June 30, 2023, marking a substantial increase of $687 million compared to the same period in 2022.

CEO of Wynn Resorts, Craig Billings, expressed enthusiasm for the remarkable results. He highlighted the strong performance of Wynn Las Vegas and Encore Boston Harbor in the United States, which contributed to a new second-quarter record for Adjusted Property EBITDAR at their combined North American properties. Additionally, the recovery in Macau’s market after the pandemic was accelerated, with notable growth in the mass gaming, luxury retail, and hotel sectors.

The company reported net income attributable to Wynn Resorts of $105.2 million for the second quarter of 2023, a significant turnaround from a net loss of $130.1 million in the second quarter of 2022. Diluted net income per share for the same period was $0.84, compared to a diluted net loss per share of $1.14 in the previous year.

In Q2 2023, Wynn Palace‘s revenues rose to $468.4 million from $58.7 million last year, with VIP table games at 4.24% turnover. Wynn Macau‘s revenues increased to $301.6 million from $58.6 million, with VIP table games at 4.16% turnover, and both properties saw improved mass market table game performance.

In Q2 2023, Las Vegas Operations revenue reached $578.1 million, up by $17.0 million from last year, with a 22.9% table games win percentage. Encore Boston Harbor‘s Q2 2023 revenue was $221.9 million, a rise of $11.8 million, and its table games win percentage was 22.3%, exceeding the expected range.

Wynn Resorts Embarks on $3.9 Billion UAE Resort Venture for Future Growth

Billings also took the opportunity to announce the commencement of construction on Wynn Al Marjan Island, an ambitious integrated beachfront resort in Ras Al Khaimah, United Arab Emirates (UAE). The project, a collaboration with local partners Marjan LLC and RAK Hospitality Holding LLC, is expected to transform the region into a must-visit tourism destination. 

The $3.9 billion development is modeled after Wynn’s Las Vegas properties, emphasizing non-gaming amenities, and is scheduled to open in 2027.

Despite global uncertainties, Wynn Resorts remains optimistic about its future growth prospects. The company’s diversified portfolio, including Wynn Las Vegas, Encore Boston Harbor, and properties in Macau, positions it well to capitalize on various market trends. Investors responded positively to the results, with the company’s stock price rising by 1.12% in after-hours trading. Wynn Resorts’ solid second-quarter performance indicates its resilience and strategic focus, positioning it to navigate the evolving dynamics of the global hospitality and gaming industry.

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Nordic gaming group Paf released its 2022 annual report, posting a record-high turnover and an impressive increase in net profit.

Turnover by Divisions

For the twelve months ended December 31, 2022, Paf Group registered a turnover of €165.7 million ($179 million), posting an increase of 23% from €135 million ($145.8 million) the group accounted for in 2021.

“We are pleased with last year, it is a good result and a testament to our ability to deliver,” commented Paf’s chief executive officer Christer Fahlstedt, highlighting Sweden, Switzerland and Spain as the gaming destinations which stood out, as well as the recovery of the group’s ship operations.

Paf’s internet operations in the year accounted for €142.1 million ($153.5 million), generating 17% more than in 2021 (€121.2 million ($130.9 million)), with particularly strong growth registered across the Swedish and Spanish markets.

The group attributed the turnover increase to the record number of active customers during the year, 483,595, which increased by 44% from 336,206 in 2021, and expects the number of its active customers to continue to grow in 2023.

Turnover from land and ship operations generated €23.5 million ($25.4 million), increasing by more than 70% year-over-year mainly due to a sharp increase in the number of passengers on board the vessels compared to the prior year. Paf believes there is still room for this number to increase and reach the 2019 level and expects the positive trend to continue in 2023.

Other operating income increased by 9%, from €6.8 million ($7.3 million) in 2021 to €10.1 million ($10.9 million) now, mainly due to the increased sales of gambling platforms and associated services.

Expenses, Operating Profit, Net Profit

Costs in 2022 aggregated to €128.3 million ($138.6 million), up 20% from €106.8 million ($115.3 million) in 2021. There were increases in materials and services costs, €39.5 million ($42.7 million), up 30% from €30.3 million ($32.7 million) in 2021, and other operating expenses which were up by more than 25% to €54 million ($58.3 million) from €43.1 million ($46.5 million) in 2021, and staff costs marginally increased while the cost of depreciation remained almost unchanged.

Paf explained the increased costs by an increase in marketing expenses, costs for the cloud-based technology and travel expenses.

Paf Group ended 2022 with an operating profit of €48.5 million ($52.4 million), up 36% from €35.7 million ($38.6 million) in 2021. The net result of financial income and expenses was a loss of €1.6 million ($1.73 million) while in 2021 it was €300,000 ($324,000).

“Paf’s purpose is to generate funds for the benefit of society and with the strong result we can distribute €33.1 million,” said Paf’s chairman Jan-Mikael von Schantz, thanking all employees for their performance over the past year.

Net profit in 2022 was €44.4 million ($48 million), registering an impressive increase of more than 35% from €32.8 million ($35.4 million) in 2021.

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Data, technology and broadcast company Genius Sports released today its fourth quarter and full year 2022 financial report, posting an impressive increase in revenue and a significant drop in the group’s net loss.

Quarterly and Full-Year Revenue

Genius Sports generated $105.34 million in revenue in the fourth quarter and $341.03 million in the full year ended December 31, 2022, posting increases across all its divisions both in the quarterly and full-year readings.

Commenting on the results, Mark Locke, co-founder and chief executive officer of Genius Sports, outlined the company’s success in delivering on its forecast in each quarter as a display of its “commitment to executing the financial and strategic plan” set forth at the start of 2022.

We remain relentlessly focused on balancing investment in our highest growth initiatives, while still demonstrating the unique operating leverage of our business model.

Mark Locke, co-founder & CEO, Genius Sports

Mark Locke is convinced that in 2023, the company should be able to capitalize on its global competitive position and “capture the immense opportunity” ahead of it.

Across the divisions, Betting Technology, Content & Services was up 21.5% in the quarter and 18.1% in the full twelve months; Media Technology, Content & Services increased by 50.4% in Q4 and 71.2% in full-year 2022; and, Sports Technology & Services contributed to the total with an increase of 8.6% in Q4 and 31.9% in the year.

Adjusted EBITDA, Net Loss

Adjusted EBITDA in Q4 was $2.66 million, up 121% year-over-year, while for the full year 2022, it was $15.79 million, a nine-fold increase as compared to 2021. Both group revenue and group adjusted EBITDA exceeded Genius Sports’ guidance of $340 million and $15 million, respectively.

Group net loss in Q4 was $127.72 million, up two-and-a-half times from $53.29 million in Q4 2021. For the full year, the group’s net loss fell by 69.4% to $181.64 million ($592.75 million in 2021).

Our expectation of nearly tripling our Group Adj. EBITDA and generating free-cash-flow in the second half of 2023 is the direct result of a cost base that does not need to grow in line with revenues moving forward.

Nick Taylor, CFO, Genius Sports

Based on the 2022 results and current performance, Genius Sports maintained its 2023 revenue and adjusted EBITDA guidance of $391 million and $41 million and expects to generate positive free cash flow in the second half of the year.

“With $159m of total cash on our balance sheet, zero debt financing, and our legacy warrants now removed, our shareholders are well positioned to capture the benefits of profitability and cash flow acceleration,” Taylor concluded.

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