Macau’s gaming operators are facing the challenge of upcoming debt maturities, with significant obligations slated for 2025. However, amidst the financial landscape shaped by the COVID-19 pandemic, these operators seem prepared to handle the situation with cautious optimism.

Macau Casinos Delay Debt Refinancing for 2025, Eyeing Improved Cash Flow

According to recent insights from S&P Global Ratings, Macau’s gaming operators are strategizing to delay refinancing plans for their 2025 debt maturities. This delay is primarily aimed at capitalizing on potential reductions in interest rates and anticipating improved cash flow from the Macau market in the coming quarters.

Melissa Long, director of corporate ratings at S&P Global, highlighted that operators are likely to wait before addressing these 2025 maturities, expecting a favorable shift in interest rates and enhanced cash flow generation from the Macau market. Long emphasized the operators’ intention to prudently manage larger maturity needs while actively seeking to preserve liquidity positions.

While some operators are expected to face current debt obligations in the near term, S&P Global remains optimistic about its ability to maintain sufficient cash resources to sustain liquidity positions.

The agency also anticipates continued support from banks, buoyed by the market’s robust recovery and operators’ improved cash flow and leverage metrics.

MGM China and Wynn Macau Set to Weather 2024 Debt Maturities

MGM China and Wynn Macau, specifically mentioned in S&P Global’s analysis, are deemed well-positioned to handle their 2024 maturities without the need for immediate refinancing. This financial stability is attributed to their existing cash reserves and access to revolving credit facilities.

The debt landscape in Macau’s gaming sector reflects the broader trend of recovery in the region’s gambling industry. Despite the challenges posed by the pandemic, Macau’s casino revenue is projected to surpass pre-COVID levels for the first time in 2024. Factors such as increased outbound Chinese travel and strong performance during the Lunar New Year break contribute to this optimistic outlook.

The shift towards mass-market gambling following regulatory crackdowns on VIP junkets indicates a strategic adaptation among casino operators. This transition, coupled with ongoing improvements in cash flow and market share, underscores the resilience of Macau’s gaming industry.

Looking ahead, the positive trajectory of Macau’s casino revenue and the gradual easing of pandemic-related restrictions bode well for the sector’s long-term stability. While challenges persist, including looming debt maturities and competitive pressures, Macau’s gaming operators appear poised to navigate these obstacles with resilience and adaptability.

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The leading online gaming operator in Latin America and Spain, Codere Online, released its preliminary second quarter financial results. On Thursday, the company unveiled details regarding its performance for the second quarter ended June 30, 2023, reporting strong growth of average monthly active players along with an increase in net gaming revenue.

Judging by the latest results, Codere Online’s net gaming revenue (NGR) hit €39.1 million ($41.4 million). This result, when compared to the Q2 2022 result of €29.2 million ($31.7 million), marked an increase of 34%. The company provided a breakdown of the NGR posted for the second quarter of 2023, revealing that its revenue in Mexico increased year-over-year by 51% to €18.0 million ($19.5 million) while its Spanish revenue soared by 24% to €17.5 million ($19 million).

In contrast, Codere Online’s Colombia NGR marked a decrease. The online gaming operator revealed that its Colombian revenue halted at €2.1 million ($2.3 million), down by 5% when compared to Q2 2022. The company posted revenue of €1.4 million ($1.5 million) for all other regions, up by 40% year-over-year.

When it comes to the average monthly active players, Codere Online posted strong results as well. Overall, the company reported 125,800 average monthly players in Q2 2023. That figure compared to the Q2 2022 result of 104,600, marked an increase of 20%. Not unexpectedly, the company posted strong growth of average monthly active players in Mexico that increased 54% year-over-year, while in Spain, an uptick of 20% was observed.

The Company’s CEO and CFO Are Excited with the Recent Results

Oscar Iglesias, Codere Online’s CFO, was delighted about the recent results and said: “We continue delivering strong revenue growth, despite a lower level of marketing investment, on the back of strong brand recognition, higher quality customers and continued improvement in our product offering.” Acknowledging the strong results, he said that the company expects to continue to exceed its initial expectations and post net revenue growth of 7% for 2023.

“We’re glad to present a strong set of second quarter results and to continue building upon the momentum from the first quarter.“

Aviv Sher, CEO of Codere Online

Aviv Sher, Codere Online’s CEO, was similarly excited about the latest results. He explained that the company continues to benefit from the positive momentum gained during the first quarter of the year. Sher highlighted the exceptional growth in revenue which comes during a period that has fewer sporting events.

Additionally, he explained that Codere Online’s casino product enjoyed strong growth and helped contribute 54% of the total revenue for Q2 2023. Finally, Sher was excited to see the company’s soaring revenues in Spain, as well as Mexico.

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The developer and designer of equipment and services catering to the global gambling sector, PlayAGS, enjoyed strong growth after posting record-breaking Q4 2022 results in March. Now, the positive momentum gained by the company grows further as it celebrated another record-setting period, judging by its second quarter 2023 results.

PlayAGS’ latest trading update was released Thursday and highlights the performance of the company for the three months ended June 30, 2023. The total revenue reported by PlayAGS for the aforementioned period hit $89.8 million. This result, when compared to the $76.6 million result figure from the same period in 2022, marks a solid increase of 17.3%.

A breakdown provided within the latest trading update reveals a strong performance of the company’s three business segments: Interactive, Table Products and EGM. The biggest revenue growth was observed for PlayAGS’ Table Products, with revenue hitting $4.4 million, up by 25.1% when compared to the corresponding period in 2022.

Similarly, EGM revenue for the second quarter of this year increased. While in Q2 2022, EGM revenue halted at $70.5 million, this year, it soared by 17.3% to $82.7 million. Last but not least, PlayAGS’ Interactive business saw an increase in revenue to $2.8 million, up by 5.8% from the $2.6 million result from Q2 in 2022.

Besides record revenue, the second quarter of 2023 brought an increase in EBITDA. The recent report released by PlayAGS reveals that total adjusted EBITDA for Q2 2023 increased to $39.6 million, up by 16.0%, when compared to the Q2 2022 result of $34.1 million.

Earlier this year, PlayAGS strengthened its C-suite with the appointment of Robert Ziems as chief legal officer. The expert joined the company’s senior management team, bringing more than two decades of experience.

The Company Anticipates Further Growth

Kimo Akiona, PlayAGS’ chief financial officer, shared his excitement about the strong performance of the company for the second quarter of 2023. He explained that PlayAGS has seen strong growth for the first half of the year. At the same time, Akiona predicted that the company will maintain the positive momentum and deliver excellent results through the end of the year.

“Our record-setting second quarter financial performance clearly demonstrates the strength of our products, team members, and strategy, which is creating significant momentum within all three segments of our business.“

David Lopez, CEO and president at PlayAGS

David Lopez, PlayAGS’ CEO and president, explained that the record-setting results reaffirm the strong strategy and products the company leverages. Additionally, he highlighted the dedication of PlayAGS’ team. According to Lopez, the combination of all those factors helped the company gain and keep a positive momentum. Finally, the CEO and president predicted further growth for PlayAGS throughout 2023 and beyond.

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Global gaming, sports betting and entertainment company Entain released a new report, highlighting the positive impact of docuseries in sports and how such blockbuster shows can help attract new sports fans and engage with existing ones.

It was back in November 2020 when Ryan Reynolds and Rob McElhenney, two iconic Hollywood actors, took over Wrexham AFC, the professional association football club based in Wrexham, Wales. Then, last year in August, Welcome to Wrexham, a docuseries describing the purchase and stewardship of the famous soccer club debuted. This weekend, Wrexham AFC is scheduled to debut in League Two of the English Football League, marking another important achievement for the soccer team.

The aforementioned events helped build up the “Wrexham Effect,” as described by Entain, which resulted in an increased engagement with the team’s fans and even onboarded new fans. Focusing on results, the global betting and gaming company revealed that Entain Australia has seen an increase of 781% in the number of bets for Wrexham AFC soccer games between 2019 and 2022/23.

Non-league Soccer’s Popularity Receives Boost from Docuseries

In the UK, the company said that its sportsbook saw an uptick of 59% in the number of bets placed on the National League’s 2021/22 season when compared to the 2017/18 season. According to Entain, the increase in the number of bets surpassed the increase observed for League One, which was 32%, League Two which was 24% and Championship League which grew by 15%. At the same time, Entain acknowledged the surge in popularity of non-league football pushed by docuseries.

More importantly, in the US, BetMGM saw a staggering increase in the number of bets placed on any Wrexham AFC soccer game. According to Entain, the number of bets for Wrexham soared by a staggering 3818% from the 2020/21 season to the 2022/23 season.

Dominic Grounsell, Entain’s CCO, acknowledged that a significant change was observed in the way sports fans engage with sports. Moreover, he acknowledged the positive impact of sporting docuseries that delivered an innovative way to engage with new and existing sports fans.

“We’ve seen a huge step change in the way fans engage with their favorite sports, and behind-the-scenes access in sporting docuseries has only heightened this further.“

Dominic Grounsell, CCO at Entain

Grounsell said that Entain monitors the way fans engage with the sport and at the same time, collects feedback from its customers, allowing it to create content that caters to their needs. “Coral’s ‘Taking the Reins’ documentary series is a prime example of this and reinforces our commitment to bringing moments of excitement to fans beyond the track, pitch, or court,” he said in conclusion.

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Leading Swedish gambling operators, Kindred Group, Svenska Spel, and ATG, have released their latest data on responsible gambling in Sweden, revealing that a significant number of players change their behavior after being contacted by the operators.

Operators Release Responsible Gambling Metrics in Sweden

In an effort to promote transparency and responsible gambling, the three operators began sharing internal data on their responsible gambling initiatives in the autumn of 2022. The data is submitted to the Swedish gambling regulator, Spelinspektionen, every six months.

The published data covers four key areas: the percentage of players contacted due to risky gambling behavior, the impact of operator contact on players, the number of players who reduced their problem gambling habits, and the percentage of players who completely stopped gambling.

During the period under review, Kindred reported that 0.5% of its customers were contacted over suspected or at-risk problematic gambling behavior. This percentage remained consistent with the previous six-month period. 

Of those contacted, 75.1% reduced their gambling activities after interacting with the operator, and 75.8% decreased their average gambling deposits. Additionally, 1.1% chose to self-exclude from Kindred’s platform for less than six months, while 0.8% opted for a self-exclusion period of six months or longer.

Additionally, in April Kindred Group disclosed a reduction in its revenue share from harmful gambling for the first quarter of 2023.

ATG’s Responsible Gaming Efforts Yield Positive Results: 57.3% Reduce Gambling

ATG, on the other hand, contacted 1.9% of its customers regarding their gambling behavior during the period, an increase from the previous six months’ figure of 1.4%. Following operator contact, 57.3% of users reduced their gambling, and 61.1% decreased their deposits. Moreover, 1.4% of customers chose to self-exclude for up to six months, while 1.9% opted for a self-exclusion period longer than six months.

Sophie Linghag, the head of fair play at ATG, commented: “It is important that ATG, Kindred and Svenska Spel continue to report key figures for responsible gaming in an equivalent manner. Transparency helps to drive the gambling industry in a more sustainable direction. The key figures should be reported because they form the core of the duty of care, an important provision in the Gambling Act: monitor risky gambling patterns, initiate contact, and ensure limited gambling when there are reasons for it. “

Although Svenska Spel did not provide full figures, CEO and president Patrik Hofbauer noted that seven out of ten customers reduced their gambling habits after being contacted by the operator. The positive effect of the operator’s measures was emphasized, particularly in light of the company’s marginal year-on-year increase in net gaming revenue, primarily driven by digital growth.

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