Good morning/afternoon. On today’s agenda:

• Wynn Resorts offers positives as it restores dividend.

• A’s make a switcheroo to a new Bally plan.

• Light & Wonder extols Australian listing benefits.

• PlayAGS puts in the work with more quarterly beats. 

Seems like yesterday, but it was long ago.

Wynn in shape

Analyst quibbles over market share were the only clouds on the Macau horizon.

Wise owl: CEO Craig Billings marveled at the Macau bounceback, saying of the marketwide recovery “who would have thought even six months ago that the market would be run rating north of $22bn of annual GGR”. But the longer-term shape of the market was still to be defined, even as the changes in the junket environment and the shift to mass was “well understood”.

• “A wise person once told me that half of great strategic thinking is ignoring noise, and there was a tremendous amount of noise in the market in Q1,” he said.

• The market is “compounding month over month and growing month over month and creates a lot of noise”, he added. 

• “But in general, I would say that the market is coming back much more quickly than anybody would have thought, six, nine months ago. It’s incredibly good to see.”

• A word of caution came from the analysts who noted that it appeared Wynn lost some market share in March. 

• Credit Suiise said this was likely due to the ongoing construction at the Wynn Macau property and competitor room openings.

Against the wind: In Vegas, Billings said it was a “fascinating time in our business”. Despite the headwinds of high inflation, high interest rates, bank failures and “increasingly difficult” YoY comps, Wynn Las Vegas delivered $232m of adj. property EBITDA.

• This was “supported by a consumer that continues to feel flush”. 

• He also noted Vegas had just completed the “best April in the history of the property”. 

Return of the cash: CFO Julie Cameron-Doe noted that Wynn’s Las Vegas and Boston properties had generated over $1.1bn of adj. property EBITDA in the LTM and has $4.7bn of cash and revolver facilities available. Billings highlighted how the returning dividend was the “cornerstone” of Wynn’s capital return strategy.

• “The US business is getting plenty of cash flow, Macau is coming back quickly.” 

• He added this was being balanced by “high-ROI development projects” in Boston and the UAE while also holding some back for New York City.

Tighten up: For online, Billings noted the company had reduced the burn rate to $21.1m of losses in Q123, with the team continuing to “stay disciplined” on cost while driving improved marketing efficiencies.

• The Massachusetts sports-betting opening got a brief mention, with Billings saying it drove a 20% increase in sign-ups to the Wynn Rewards loyalty program YTD. 

• “I expect the book will continue to be a significant driver for new customer acquisition over time.”

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A’s switcheroo

Bally’s is now the preferred partner with the A’s for a baseball stadium.

Red right hand: Bally’s has reportedly entered into an agreement with the Oakland A’s to build a $1.5bn stadium on nine acres of land on the South Strip on Tropicana Avenue and would involve demolishing the Tropicana. 

• According to the Las Vegas Review-Journal, the deal would replace the original plan involving Red Rock Resorts and up to $500m of public funding.

• The new plans include public financing of $395m.

• The Nevada Independent reported that time was running out on that proposition to be filed with the legislature.

A big day for…

SBC’s North America Summit kicks off today with a keynote from Matt King of Fanatics Betting and Gaming.

Fanatics: Matt King, CEO of the betting and gaming division of Fanatics, will kick-off proceedings at SBC’s North America summit later today. Expect him to lay out something – but not all, obvs – of his vision for what Fanatics might be looking to do in the space.

• Scott McClintic, chief product officer for Fanatics Betting and Gaming, told the GeoComply Challenger Series event earlier this week that the company was preparing the way for its attempt to disrupt the current OSB status quo. 

• He noted that when he joined the company it had around a dozen people and now it was up to 500.

Call/response: Also speaking later today, Adam Greenblatt from BetMGM, Richard Schwartz from Rush Street and Christian Genetski of FanDuel will doubtless be highlighting how they welcome competition.

• Competing in the same time slot, Davis Catlin from Discerning Capital, Andrew Zarnett from Jefferies, Chris Lynch from Citizens and Lloyd Danzig from Sharp Alpha will take a look at the investment trends.

All is Light & Wonder

Supplier sets out major corporate targets as revenues grow 17% in Q1.  

Busy-ness: A strong first quarter for Light & Wonder was complemented by significant corporate moves that will see the group go live with a secondary listing on the Australian stock exchange in Q2, launch three live casino brands in Michigan and set a consolidated adj. EBITDA target of $1.4bn for 2025. 

• Deeper down under: CEO Matt Wilson said the ASX listing would open the group up to “a deep and liquid pool of investors” to complement the existing shareholder base.

• Wilson said “given my [Australian] accent”, the listing was important to him, but that it would enable LNW to expand in Australia, where market share had risen from single digits to 21%.

• Strategic importance: The Australasia region had become “strategically much more important from an operation(al) standpoint” in the past 12 months, he added.

• Gaming revenues rose 17% to $670m in Q1, with the group shipping ~7.6k units during the quarter and premium sales growing 46%. 

• The adj. EBITDA target will be driven by gaming and digital growth, said CFO Connie James.

3 on 3: In online, revenues rose 10% to $65m and, having recently announced a live casino partnership with Rush Street Interactive in Michigan, Wilson said LNW had also signed DraftKings and its Golden Nugget brand for live casino in the state, with launch set for Q3.

• Infusion time: Wilson said Michigan represented 30% of the iCasino TAM in the US and the “$1.4bn ramp” will be driven by “infusing” LNW’s digital products with “great land-based content”.

May the 4th be with you: Apart from table products, all units were up, James said, with adj. EBITDA rising 23% to $249m and margins up 200 bps to 37%. Social casino drove SciPlay’s revenues up 18% to a record $186m and the group returned $437m to shareholders as part of a share repurchase program that ended on May 4.  

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PlayAGS vibrant

Continued quarterly beats defy the uncertainty over macro.

Hit that perfect beat: CEO David Lopez said the consistent financial performance was driven by “greater resiliency and vibrancy” in the business. He remained optimistic and noted sales of the newest Spectra cabinet had “not skipped a beat”.

• “We sold to a record number of customers and believe that will expand into Q2,” he added.

• “Spectra is taking us to another level,” he said. “You have this synergistic momentum. It’s helping us sell to more customers and get deeper into existing customers.”

• Asked about further product developments, he said “we always have something to come”.

Noting the dichotomy between stock market volatility driven by recessionary fears and the current booming gaming markets, Lopez agreed that the schizophrenic environment “doesn’t make sense”.

• “Should this thing around the corner show up, should things get soft, how much do operators pull back on capex, I think that is very difficult to say,” he added.

• But if capex is the barometer then “there is no pullback.” 

• “Operators have not shown us anything to say they believe things are going to get soft. Right now capex is strong and belief is strong.”

Earnings in brief

Sportradar: Revenue rose 24% to €208m while adj. EBITDA was up 37% to €37m, with the US segment up 55% to €40m of revenues and the rest of the world betting segment up 25% to €109m. 

Note: E+M will report on Sportradar’s call with analysts in tomorrow’s edition.

Everi: Revenues rose 14% to $201m with the games segment up 9% to $107m while fintech rose 20% to $93m. Adj. EBITDA was up 3% to $93m. The growth was reflective of both organic initiatives and from recent acquisitions.

Bragg Gaming: Revenues rose 22% to €12m while adj. EBITDA improved 28% to €3.9m.

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Newslines

Kindred says its new proprietary platform in New Jersey is now live.

Calendar

• May 10: GAN, Golden Entertainment, Double Down, NeoGames (earnings)

• May 11: NeoGames (call), Raketech, Gambling.com, Codere Online

• May 16: Better Collective

• May 17: Catena Media, Acroud

• May 18: Aristocrat

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