iGaming Wrap-Up of CW 18-19 2024
#iGaming News of the week
0.?????? Brazil commits to 15% player prize tax
The tax framework applied to player prizes and winnings has been settled for Brazil’s Bets market.
Yesterday, the Federal Revenue Service (RFB) of Brazil confirmed its ruling on personal income tax (IRPF) that will be applied to â€net prizes’ obtained via betting, lotteries, and online gambling. As anticipated, the RFB approved the government’s modality to impose a 15% personal income tax on prizes and winnings above BRL 2824 (circa €530).
The RFB will exempt the 15% tax charge on net winnings/prizes below BRL 2824 – a figure reported to be equivalent to two average monthly wages for Brazilian consumers. Net prizes of the Bets market will be determined as the difference between the prize amount won and the total amount wagered by the customer. The 15% tax charge will be applied â€at source’ by operators when crediting customer winnings, a mechanism replicating the same functions as state lotteries.
The framework was authorised by RFB General Secretary Robinson Sakiyama Barreirinhas, and in turn, will apply changes to Brazil’s federal tax laws on the Income Tax on Individuals (IRPF) and the Declaration of Income Tax Withheld at Source (DIRF).
#Breaking News
1.?????? Tax Code in North Carolina and other States force sports betting losers to pay up
Nathan Goldman and Christina Lewellen, both associate professors of accounting at the Poole College of Management at North Carolina State University, recently wrote what amounts to an eye-opening article, detailing how sports bettors in the Tar Heel State will be on the hook to pay taxes on their sports betting winnings — even if they are sports betting losers.
This article clearly got to Gov. Roy Cooper’s desk, as he, less than a week later, called on the North Carolina legislature to immediately fix the problem. And the problem is relatively simple, as far as these tax things go: Gamblers in North Carolina are not allowed to write off gambling losses.
“North Carolina doesn’t have itemized deductions for gambling,” Goldman told Sports Handle. “There is a flat tax of 4.5% on gambling winnings. As an example, if you bet $22 and won $20, that $20 you just won is being taxed at 4.5%. But if you bet $22 again and lose, you don’t get to write off the $22, which means you’re down $2 in total, but still have to pay the 4.5% — about 90 cents — in taxes on the first bet.”
2.?????? Super Group announces €140m deal to bring tech stack in-house
Super Group said the transaction would bring it closer to its goal of fully owning its sportsbook technology across its worldwide markets.
The company added the deal would give it the capability to apply the technology stack to any properties it chooses to buy or build in future.
Super Group CEO Neal Menashe said: “I’m delighted that we have now concluded terms for the sportsbook – we have been working closely to agree to an equitable deal with a favourable structure for both parties.
“This is an exceptional opportunity for Super Group to take full control of our sportsbook technology, which would enable maximum flexibility for organic growth as well as potential M&A opportunities. “We’ll continue to deliver the best sports betting and gaming experience to our customers around the world as the benefits of this deal are realised.”
3.?????? 888 refinances ￡400m of debt to bolster VCP plan
The board of 888 Holdings has secured terms to refinance ￡400m of senior secured debt notes held by the LSE gambling group. The transaction is expected to proceed on Thursday 9 May with senior debt notes offered at 10.75% due in 2030.
Further financial developments saw 888 enter an agreement to secure an additional revolving credit facility of ￡50m. Terms of the credit facility will mature from 31 December 2025.
Operating under its new â€Value Creation Plan’ (VCP), 888 will implement a new disciplined capital allocation to reduce its corporate net debt of ￡1.7bn to a leverage of below 3.5x by the end of 2026
4.?????? Catena Media rolls out “aggressive” action plan as Q1 revenue drops 49%
Catena Media is rolling out an “aggressive programme of measures” as Q1 2024 proved to be another challenging period with revenue, EBITDA, and new depositing customers all experiencing double-digit declines.
Revenue from continuing operations fell by 49% compared to the same period last year, to €16m. Adjusted EBITDA from continuing operations plummeted by 90% year-on-year to €1.9m, with an adjusted EBITDA margin of 12%. Revenue in North America also dropped 50% year-on-year to €14.3m, accounting for 90% of the group’s revenue from continuing operations.
“Built for fast scalability, the platform will significantly strengthen our operational robustness and make it easier to centrally deploy, track, and optimise our advertising content across both our core products and new products, such as AI, paid media and sub-affiliation, into which we are expanding,” Cadena said.
Catena Media has set its sights on achieving adjusted EBITDA in the range of €20m to €30m for full-year 2024.
5.?????? Genius Sports releases Q1 2024: Revenue up 23% to $119.7m
Genius Sports has published its Q1 report, for the period ending 31 March, 2024.
The revenue for the data suppleir rose 23% to $119.7m, with the best performing vertical being its betting technology, content and services delivering $73.9m of the total, a 14% when compared to the same period the year prior.
Despite this, media technology, content and services saw the largest improvement with a 63% growth translating into $35.5m in revenue, which the company attributed to growing its business in the US. Its final vertical, sports technology and services, saw a decline of 4% to $10.3m. The net loss for Genius Sports also grew by 1.5% to -$25.5m, although the company didn’t add any explanation for this.
The adjusted EBITDA dropped 15% to $6.9m, which Genius Sports put down to expenses related to NFL domestic streaming rights.
“As we expand our technology footprint and work to extend one of our most important data partnerships with Football DataCo, we feel an enhanced sense of excitement and confidence in our outlook for 2024 and beyond.”
6.?????? Games Global confirms details of its 2,1bn IPO
Games Global has confirmed the launch of its initial public offering (IPO).
The iGaming supplier revealed that a total of 14.5 million ordinary shares will be made available, and are expected to sell for between $16 and $19 per share. The offering will consist of 6 million shares offered by Games Global with a further 8.5 million shares to be sold by Games Global’s existing shareholders. Underwriters will also have a 30-day option to purchase an additional 2.175 million ordinary shares from the existing shareholders.
Earlier this month the company registered for the IPO with the New York Stock Exchange (NYSE). In a filing with the SEC, it confirmed that it intended to trade on the NYSE under the GGL symbol.
7.?????? Wynn releases updated images of new UAE integrated resort
Wynn Resorts has released new images of its upcoming United Arab Emirates luxury resort, Wynn Al Marjan Island, currently under construction in Ras Al Khaimah. The development is the company's first beachfront resort and is being built on "a beautiful island of almost 62 hectares jutting into the Arabian Gulf," as per a statement.
Wynn Resorts is developing the project in partnership with Marjan and RAK Hospitality Holding. It is anticipated to be the first integrated gaming resort in the Middle East North Africa (MENA) region.
“Wynn Design and Development, employing more than 90 talented architects, designers, and creative visionaries, is overseeing all facets of the project's design and development. Wynn Resorts is unique in that it maintains its own full-service design and architectural team,” the company says.
#US / Canada
8.?????? Baseball star Ohtani's ex-interpreter agrees to plead guilty to bank fraud
Japanese baseball great Shohei Ohtani's former interpreter has agreed to plead guilty to federal charges he fraudulently wired nearly $17 million stolen from the athlete's bank account to pay off his own gambling debts, court records showed on Wednesday.
The plea agreement between federal prosecutors and Ippei Mizuhara, the onetime translator and de facto manager of the Los Angeles Dodgers' power-hitting pitcher, was announced by the U.S. Attorney's Office in L.A., where the case was first brought last month.
Mizuhara was accused of embezzling nearly $17 million from a bank account of Ohtani's that Mizuhara had helped open in Phoenix in 2018, and transferring the funds without the ballplayer's knowledge to an illegal bookmaking operation to cover Mizuhara's gambling debts.
9.?????? NY Fantasy Sports Market Set for Overhaul with Sen. Addabbo’s Bill Proposal
State Senator Joe Addabbo brought out the big names at the state Capitol this week in support of a bill that he says would modernize daily fantasy sports in New York.
领英推čŤ
Former New York Yankees star Tino Martinez argued that if passed, the bill will also enhance the fantasy experience for New Yorkers like him in the process.
“It’s a great way for our family to come together and it’s very enjoyable,” he said. “It gets me involved in more of the players that I don’t know are out there. I get to learn them and talk to my kids about it, to my mom about it.”
Addabbo says along with updating the regulatory environment for daily fantasy sports, the bill raises the age to participate from 18 to 21, closing a loophole and putting it on a level playing field with mobile sports betting.
“We stand at the ready. As legislators, we look to do what’s right for the state, making it a better product, making it safer for our residents, and that’s what we hope to do if not this session, certainly as soon as possible,” he said.
10.?? Wynn talks up New York and Thailand plans after record Q1
Wynn Resorts chief executive Craig Billings said the operator is actively considering options to establish land-based casinos in New York and Thailand to further expand its business and build on a record first quarter.
Q1 revenue at Wynn amounted to $1.86bn (￡1.49bn/€1.73bn), up 30.8% from last year’s total. The group reported year-on-year growth across three of its four core areas: casino, food and beverage and rooms.
Billings also hinted at further expansion for Wynn, referencing potential launches in both New York and Thailand. New York looks to be the first possible new market for Wynn, with the operator considering an integrated resort in Hudson Yards.
#M&A & Finance
11.?? Q1 2024: Super Group reports record revenue as group mulls US future
Betway operator Super Group reported record Q1 revenue as the company considered the future of its loss-making US business.
Super Group reported €379.3m of revenue in the first quarter of the year, marking a record Q1 and a 12% increase from the previous year. Of this total, €222m was generated by the company’s sports betting-centred Betway, while the remaining €157.3m resulted from the company’s iGaming-focused Spin brand.
CEO Neal Menashe said: “We’ve had a phenomenal start to the year, continuing our momentum from a strong end to 2023.
“This robust performance has been delivered by our global team’s ongoing focus and investment into core markets that are yielding strong returns, providing us with a solid foundation for the remainder of the year.”
The CEO said the company was looking at all options to make a decision that is in its long-term interest.
He added: “This is a waiting game – over time different states can regulate and you’ve got to be in play to have a chance of success, we understand that.
12.?? GiG reports â€all-time high’ Q1 ahead of platform and media split
GiG has revealed it has performed itss â€13th successful quarter’ in the latest quarterly update from the company.
Petter Nylander, GiG Chairman of the Board, said that they are â€proud’ of another all-time-high revenue,driven by organic and M&A developments across its media and sportsbook ventures.
Presented by Jonas Warrer, CEO Media and Group CEO, the reported revenue generated by GiG Media stands at €28m for Q1 2024 – an increase of 52% compared to the previous corresponding period (pcp) – 21% of which is organic.
The GiG Media EBITDA margin also improved compared to the pcp, as well as Q4 2023. Warrer added that 63% of revenue comes from recurring revenue share agreements. Earnings from these agreements grew 47% YoY.
Revenues from the legacy Nordics and Europe markets are up 57% YoY. In the Americas, GiG Media saw an increase of 82% YoY in revenues, which in total represented 22.2% of GiG Media revenues.
13.?? Enteractive nets Bettor Capital as strategic investor
Player conversion and reactivation services provider Enteractive has announced that it has secured new investment from Bettor Capital.
Financial terms of the strategic agreement are not available. However, Enteractive said the Bettor Capital commitment represents a limited/non-controlling investment.
Enteractive will use the new investment to support its ongoing growth plans in the US. It also said the funding will benefit its global strategy across online sports betting and casino.
Enteractive CEO Mikael Hansson said he is “delighted” to secure Bettor Capital as a strategic investor. He said the platform’s experience in and knowledge of the industry will enhance its own growth plans.
14.?? DraftKings acquires Sports IQ Analytics
The purchase of the trading tools provider will see the US sports betting giant boost its pricing capabilities.
It comes following DraftKings CEO Jason Robins’ recent commitment to be highly disciplined on M&A until it has digested its acquisition of lottery courier Jackpocket.
Dor said on LinkedIn: “I’m excited for this next chapter in the Sports IQ Analytics journey.
“In DraftKings Inc. we join a team whose desire for winning and being the best matches our own. Thank you Jason Robins, Paul Liberman and the entire team for welcoming us onboard.”
Eric Levy from Osler, Hoskin & Harcourt LLP, and Robin Chhabra of Tekkorp Capital helped facilitate the transaction, according to the post.
#Legal & Regulation:
15.?? KSA to fine Sarah Eternal €280,000 a week until it stops unlicensed offering
Kansspelautoriteit (KSA) has imposed an order against the company Sarah Eternal for offering games of chance without a licence on the website Casinosky.com.?
For operating without a licence via Casinosky.com, Sarah Eternal will be fined €280,000 ($300,000) weekly.
The order will require Sarah Eternal to make incremental penalty payments of €280,000 per week with a maximum of €840,000 until the violation is ceased, as offering this form of gaming without a licence is prohibited in the Netherlands.
In the KSA’s investigation into the platform, inspectors were able to visit Sarah Eternal’s Casinosky.com website where they could â€create an account, make a deposit and participate in illegal games of chance.’ This was despite stating their location as being in the Netherlands.
16.?? Thailand casino progress leapfrogs Japan, still faces big obstacles
Success with casino requires uniquely Thai solutions, Muhammad Cohen reports, in the first of a two-part series on Thailand.
Following nearly unanimous parliamentary support and cabinet approval, Thailand’s casino legalisation process has the momentum to meet Prime Minister Srettha Thavisin’s target of opening a casino within two years. This is the first step toward establishing “entertainment complexes” with gaming in tourist areas across the kingdom.
Thailand’s speedy progress contrasts Japan’s glacial advance toward casino gaming. Successful legalisation efforts in the world’s third largest economy commenced in 2013. Final legislative approval came in 2018. The first licence was granted in 2023 and an integrated resort is not expected to open before 2030. Two more authorised licences remain unassigned. Local and national officials are each apparently waiting for the other side to take the initiative.
hailand appears likely to open its first IR ahead of Japan. “We are looking at a smaller bite out of the apple and a much more flexible – if not transparent – government partner,” Innovation Group president, Michael Soll, says.
#Tech:
17.?? Hackers behind MGM attack launch cyberattack on Financial Sector
According to cybersecurity researchers, a hacking group known as Scattered Spider, previously linked to cyberattacks on MGM Resorts International (NYSE:MGM), is now targeting banks and insurance companies.
The cyber attack at MGM had left the company with a negative impact estimate of $100 million to Adjusted Property EBITDAR for the Las Vegas Strip Resorts and Regional Operations, collectively.
Scattered Spider, formerly accused of disrupting casinos and hotels, has targeted 29 companies since April 20, successfully compromising the systems of at least two insurance companies, reported Bloomberg.
Recent targets include Visa Inc (NYSE:V), PNC Financial Services Group Inc (NYSE:PNC), Transamerica, New York Life Insurance Co., and Synchrony Financial.