Regulator taking tough new approach
The Gambling Commission’s change to a more hardline approach to regulating the sector was shown again last week after online gambling company 888 Holdings revealed it was the subject of a review by the commission.
The move was described by one analyst as being an illustration of the increased risk of conflict between the regulator and the industry.
A statement from 888 on Monday said the review had been initiated to assess social responsibility measures employed by the company “including, amongst other items, effective self-exclusion tools across different operating platforms”.
The company added that it will be “proactively engaged in a cooperative and collaborative manner” with the commission.
888’s share price fell ten per cent on the back of the news before recovering to close at 280.50p, which still represented a fall of 5.9 per cent.
The Gambling Commission said it could not comment on individual cases.
Analysts at Peel Hunt said “an increasing degree of conflict with the Gambling Commission is a rising background risk to the sector”.
They added: “We believe it is probable that a fine and some change in business practices will result.
“It appears this public process is now the commission’s preferred way of regulating the gambling industry and fines and bad publicity are part of the cost of doing business.”
It is not just regulators like the Gambling Commission that are putting the gambling industry under pressure, politicians are too.
As expected, the Labour Party manifesto published last week promised to cut gaming machine maximum stakes to £2 as well as slowing down the speed of play.
The Liberal Democrats also made the same £2 pledge as well as promising to “grant new powers to local authorities to protect high streets and consumers by reducing the proliferation of betting shops”.
However, to the likely relief of the sector, the Conservative manifesto made no mention of the gambling industry.
Charity calls for more funding
Problem gambling charity GambleAware has raised the prospect of a statutory levy on operators and called on them to step up after falling short of its money-raising target.
Although GambleAware brought in a record £8 million in 2016-17, that was still 20 per cent short of the target set by the Responsible Gambling Strategy Board, which advises the Gambling Commission and, in turn, government on the issue.
The charity said it was estimated there were 250,000 people in Britain with a gambling problem and another 470,000 at risk of developing one but only three per cent of those needing help were getting the support they needed.
Chief executive Marc Etches said: “We all need to do more to raise awareness of the services available and to ensure sufficient capacity to meet increased demand.
“This requires all businesses that profit from gambling to step up in the next 12 months to help us achieve our objectives.
“While we continue to see the merits for maintaining the voluntary system of funding for research, education and treatment, our first priority has to be providing sufficient help for all those who seek it, so we would not hesitate in supporting the commencement of a statutory levy if the voluntary system fails to deliver.”
The Association of British Bookmakers claimed its members provided more than half of UK responsible gambling funding despite only accounting for 25 per cent of the gambling market.
“It’s time for other gambling businesses to step up their funding of responsible gambling organisations,” the ABB added.
Playtech on lookout for more deals
Online gambling technology company Playtech is still eyeing acquisitions according to a trading statement released before the firm’s annual general meeting last week.
Chairman Alan Jackson said the company had so far delivered a strong performance in 2017 due to “organic growth and recent strategic acquisitions”.
He went on: “Growth in daily average revenues in the gaming division in the year to date remains strong with organic growth supplemented by acquisitions made in 2016 and 2017 including BGT, Quickspin, ECM and Eyecon.
“As previously indicated, the initial phase of our contract with the Sun Bingo has been more challenging than anticipated and we have recently taken further steps to address the issues, including significantly strengthening the management team, resulting in an improving performance.”
“The Financials division has performed in line with our expectations, with continued growth in the B2B business and improved B2C customer KPIs. CFH [Consolidated Financial Holdings Group] continues to perform well following the acquisition in November.”
Jackson said the board was confident Playtech would meet expectations in 2017.
On acquisitions he added: “Our M&A [mergers and acquisitions] pipeline remains strong and we continue to have active discussions with a range of businesses in the gaming division as well as discussions for selective bolt-on acquisitions in the financials division.”
However, it was not all plain sailing for Playtech, with nearly a third of shareholders voting against both Playtech’s remuneration policy and remuneration report at the agm.
Record year for York
Bad weather could not stop York racecourse achieving record turnover in 2016 according to its latest set of accounts.
The track’s parent York Racecourse Knavesmire LLP, said turnover reached £21.3 million in the year to October 31, an increase of 3.9 per cent on the 2015 figure of £20.5m.
The review of the business within the accounts turnover was driven by near record attendance, an increase in media rights income – especially from streaming and international picture rights – as well as non-raceday income and entry fees.
Attendance for the year was 347,180, down 3.8 per cent on 2015 but above the three preceding years.
The review said almost all of the deficit was in the course enclosure and was attributed to poor weather, with seven days hit by wet weather compared to none in 2015.
Executive contributions by the course accounted for half the prize-money total of £7.2m, with £2m coming from entry fees and £1.6m from the Levy Board.
Operating profits rose to £2.6m from £2.5m in 2015.
York’s head of marketing and sponsorship James Brennan said: “These numbers are a credit to the hard work of all involved at York.
“Whilst our attention has already turned to the 2017 season which got under way this week, you can see how the strong financial performance of 2016 has allowed another investment in prize money to a new height of £7.6million, as well as improvements racegoer facilities such as the Eat Between Our Races area.
“Accounts naturally tell a financial story, they struggle to convey the majesty of top class horses such as Postponed or the memories made for connections and racegoers alike during the 2016 season on the Knavesmire.”
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