Earnings+More - 888’s bankers take a haircut
888’s bankers take a haircutBanks pay the price for 888 debt, the shares week, New York casino plans, 2023 analyst takes, startup focus – Livespins +MoreStart the week with Earnings+More. On the agenda for today:
Discount orgies on the dropout buses. 888’s debt discountAccording to reports, the banks who helped finance 888’s William Hill buyout have been offloading debt at a discount to get it off the books. Short, back and sides: 888’s combined €332m bond sale and $75m term loan arrangements revealed last week was occasioned by its bankers offloading £347m of junk-rated debt, according to a report from Bloomberg.
Balancing act: 888 made the point that the new debt is not expected to “materially impact” the overall cost of debt, cash interest costs or leverage ratio. Note, before the debt raise 888’s net debt stood at £1.8bn and its net debt/EBITDA ratio is projected to be 5.7x at year end, falling to 4.6x in 2023.
** SPONSOR’S MESSAGE: BettingJobs is the global leading recruitment solutions provider to the iGaming, Sports Betting and Lotteries sectors. Boasting a 19-year track record supporting the iGaming industry, and with a team of experts and world class knowledge, it’s no surprise BettingJobs is experiencing rapid growth with outstanding results. Does your company have plans to expand teams to cope with strong growth and demand? Contact BettingJobs.com today where their dedicated team members will help you find exactly what you are looking for. The shares week888 managed to regain some ground later in the week as it announced its latest debt news. Steadying the ship: 888’s shares were down over 7% midweek before managing to regain some lost ground as it announced its latest debt deal. 🛟 888’s shares regains some poise as its latest debt deal lands
Downstate uptimeWynn Resorts’ partner Related Companies set out plans for its downstate casino project at Hudson Yards in Midtown. Hard yards: The new resort would be part of a $10bn project on undeveloped land next to the Javits Convention Center. Related CEO Jeff Blau told Bloomberg it would start the second phase of the company’s $25bn Hudson Yards project.
Roc-a-fella: Among competing bidders, Caesars Entertainment and SL Green announced that rap icon and entrepreneur Jay-Z had joined its consortium to develop a Times Square resort at 1515 Broadway, with the rapper’s Roc Nation group overseeing entertainment programming at the venue.
2023 analyst takesIn a voluminous note on the sector’s prospects, the team at Deutsche Bank suggested they are broadly cautious on the year ahead. Calling it: The headline prediction for 2023 is that Macau will finally benefit as China reopens, with investors in Wynn Resorts and Las Vegas Sands being rewarded for their patience. The team harks back to 2016/17 as being the last time that Macau-related stocks “got off the mat” and see the same pattern taking place next year.
Pies and prejudice: While estimating 2023 sports-betting GGR at $8.4bn, they suggested the “size of the GGR pie remains misleading” due to the continuing elevated levels of promotion, which they estimated at ~42% of LTM GGR. As promotions are curbed, they added, so GGR will “struggle to grow” on a same-store basis.
Analyst takesOnline Q3 review: The team at EKG suggested the US online space is now becoming a three-horse race with the number of firms “contesting in earnest” now looking depleted following high-profile market exits.
DatalinesIowa: Casino GGR rose 1% YoY to $137.9m in November. Sports-betting GGR was down 71% YoY to $19.1m on handle that dropped 13.9% to $247.5m.
I’m mad as hell…The $1.2bn writedown on the value of its Bally Sports Regional Sports Networks by Diamond Sports provides little clarity for Bally’s sports-betting operation. … and I’m not going to take it anymore: The appointment of David Preschlack as CEO of the RSNs means parent company Sinclair Broadcast has been relieved of all day-to-day operations. Among Preschlack’s priorities will be restructuring the group’s $9bn debt.
Content light: For Bally’s there is also little clarity with regard to the RSNs driving online sports-wagering activity to its Bally Bet sportsbook. The group launched the Bally Sports+ app in the summer, but little is known about it when it comes to subscriber numbers.
Meanwhile on socialUnsporting trade: Confusion surrounds the situation in New Jersey where a well-known gambling Twitter personality took to the platform over the weekend to say he had been banned from using the Sporttrade betting exchange app by the company’s market access partner BallysAC.
I liked @spanky 's delivery of the Bally's letter on BBB, but it really goes best with his tweet. podcasts.apple.com/us/podcast/bal… Startup focus – LivespinsWho, what, where and when: The Malta-based Livespins was incubated by iGaming accelerator Happyhour at the end of 2020 and is led by CEO Chris Scicluna. The client list includes Relax Gaming, Yggdrasil, iSoftBet and WynnBet in the US. Funding backgrounder: Livespins raised an unspecified amount in a Seed funding round in March this year. The pitch: Scicluna says the Livespins product skirts recent controversies around Twitch by existing within the casino lobby, therefore offering a more controlled and responsible-gambling-friendly way of live streaming casino.
What will success look like? The medium term is about the “practical reality” of shipping products and gaining market access, but Scicluna says the company has not defined an exit strategy. Livespins is “on a mission to create a fantastic new live entertainment experience”. “If we can succeed in that, the rest will come,” he adds. NewslinesMore details have emerged about the sale of Leap Gaming to IMG Arena with original investor SEED Innovations, a UK-listed entity, saying the deal was worth €14m. IMG Arena was already the second-largest investor in Leap. Red Rock Resorts has bought a 67-acre parcel of land in North Las Vegas to build a new casino property, according to a report in the Las Vegas Review Journal. The Encore Boston Harbor is the first Massachusetts operator to be approved for a retail sports-betting license in the state. Public hearings for Caesars Sportsbook, WynnBet, BetMGM, Fanatics and Penn Interactive will be held later today, Monday. Toronto-listed mobile live dealer tech provider Playgon has announced a C$5m convertible debenture private placement that comes with an interest rate of 10% a year which matures in two years. The Macau authorities have announced that concessionaires will be asked to establish exclusive gaming zones for non-Chinese visitors, to help determine the amount of revenue generated by foreign passport holders. What we’re readingFlag of convenience: ‘Regulators need to crack down on sports gambling ads disguised as journalism’. CalendarDec 13: Deal Talk #5 Dec 20: Due Diligence #2 Contact
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Weekend Edition #76
Friday, December 9, 2022
$31bn-valued Fanatics' fund raise, MGM gets an analyst upgrade, sector watch – financial affiliates +More
The Startup Month #5
Tuesday, December 6, 2022
Gambling regtech's investment moment, Investor focus – Drive by DraftKings, Inside the raise – Dabble, November's fundraisings +More
Wynn’s November bounce
Monday, December 5, 2022
The shares month, World Cup balls, Betclic on the up, Ontario Lottery dressing down, startup focus – Prophet +More
Weekend Edition #75
Friday, December 2, 2022
VICI takes full ownership of two MGM properties, ESPN's sports-betting uncertainty, illegal betting survey +More
888’s debt ‘priority’
Wednesday, November 30, 2022
888 will seek to lessen debt load, DraftKings' HORSE move, Nevada pushes on in October +More
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