Earnings+More - Park and ride: CFO shift at DraftKings
Park and ride: CFO shift at DraftKingsDraftKings’ team moves, Caesars iCasino revisited, cannibalization debate +More
Changes at the top at DraftKingsTransformer: Analysts were quick to welcome the announcement from DraftKings that CFO Jason Park would be shifting roles to fill the newly created position of chief transformation officer, with the company’s senior VP for finance, Alan Ellingson, taking over as finance chief as of May 1.
Bain and pleasure: CEO Jason Robins said Park’s experience at Bain would be put to good use as he helped the company “address and capture large efficiency opportunities” in his new role. Park joined DraftKings from the private equity business in June 2019.
The team at Jefferies said their impression was Park has “experience with operational roles” and that, given the timing of the pending Jackpocket acquisition, “the transition seems appropriate.”
May you live in interesting times: JMP said the move came at an “interesting time” as DraftKings had reached an inflection point and now had the “ability to shift its focus to shareholder returns.” The team suggested Park would “leverage his private equity background” to drive “deeper into a more efficient operating structure to enhance profitability in the coming years.”
Venture capital firm Yolo Investments manages in excess of €500m in capital across 100 exciting fintech, gaming and blockchain companies. The Yolo Investments' Gaming fund, regulated by the Guernsey Financial Services Commission, has taken positions in fast-growth suppliers and operators, including Dabble and Enteractive. Yolo Investments (yolo.io) wants to hear from readers of this newsletter. Get in touch with your pitch, or for a chat about innovative products which can plug into our investment ecosystem. +More takesDon’t look back in anger: Criticisms aired since the announcement of 888’s decision to partner switch Sports Illustrated for an SI-branded sportsbook and iCasino operation were working with “20/20 hindsight,” said Yaniv Sherman, one of the key architects of the strategy. Picking up the pieces: CBRE managed to see the positives in Entain’s recent earnings, suggesting “pieces of solid fundamentals” behind the weeds, including BetMGM, Entain CEE and Brazil, all being “compelling long-term growth opportunities.” Execution risk is the main worry with the merger deal agreed between IGT and Everi, according to the team at Truist. The team has downgraded both companies to Hold due to the uncertainties around integration and synergies. Share and share unlike: A substantial difference in the amounts of share-based payments that Flutter US and DraftKings issue to their employees helps explain why the former will be generating substantially more EBITDA in the next two years, according to analysis from Jefferies. Caesars’ online underappreciationGimme some lovin’: The success Caesars is having with its online operations, particularly since it moved to focus more on iCasino, is underappreciated and has been overshadowed by the success being enjoyed elsewhere, suggested the team at Deutsche Bank.
Key to this is what DB said was the “encouraging trajectory” being shown by the iCasino operation, which has been helped by the launch in Q3 last year of the standalone Caesars Palace app that has “catalyzed” iCasino growth. The team noted that, in the last quarter, Caesars has eclipsed the $100m quarterly run rate with promotions “remaining tempered.” Adding Caesars is one of the few operators to provide color on promotional spend within online, they suggested recent spending levels were below that of their peers. 🎁 Promo intensity on the decline at Caesars Caesars has been working hard to improve the iCasino experience for its core customers, suggested Deutsche Bank, with “more games, branded content and the ability to customize their lobby.”
Hit the ground running: The new brand will be “highly visible” while launch costs are likely to be minimal and it will “scale relatively quickly,” DB added. They noted that in Michigan it has effectively acquired a business with an existing run rate of $3m-$3.5m. 🎰 Caesars iCasino share in NJ, PA, MI and WV Dieting regime: While this is going on in iCasino, in OSB, meanwhile, Caesars is managing the feat of “doing more with less,” said Deutsche Bank. They suggested handle share across Pennsylvania, Michigan, Maryland and Arizona – four states where there is clarity around promotional spend – handle share had remained “relatively sturdy” given the lowest promotional spend percentage among its peers.
White Paper worries? Join Rank Group plc and other leading operators in getting a head start on the coming era of additional checks from the sector experts. Book your demo today at https://dotrust.co.uk Offices in London and Gibraltar. FCA, ICO registered. ISO27001 certified. Cannibalization debate rumbles onSomething to chew on: The team at Regulus have dived into the debate over cannibalization of B&M by the advent of online gambling, and kicked off with a simple premise: either online comes at the expense of existing gambling expenditure, including the black market, or it comes via more spending on gambling generally and therefore less on other non-gambling pastimes and products.
Switching channels: Regulus added the “big channel shift problem” in the US compared to other global markets is that 77% of total existing consumer gambling expenditure is from land-based gambling and, of this, 88% is B&M casinos.
Boiling a frog: Regulus pointed out that in European gambling policy debates, the term “channel shift” is the euphemism employed vs. the more challenging word “cannibalization.” “From an economic perspective, channel shift has soporific frog-boiling characteristics which are easy to explain,” the team wrote.
Recall, the debate over cannibalization in the US was recently reignited by a report from the team at EKG, who said that far from eating land-based gaming’s lunch, iCasino actually helps boost B&M gaming.
Live with it: Regulus said channel shift and a degree of cannibalization were “inevitable” and would “become a fact of life at least to some degree” in the US wherever iCasino gains traction.
Calendar
Regulatory compliance is such an important feature of iGaming that it is vital to understand its role. For this reason, we spoke with our Senior Compliance Director Ohad Straschnov to understand the work he and his teams carry out. From legal standards to contract negotiations and conforming to regulations, read the article to find out how Ohad’s team enables Soft2Bet and its partners to operate in regulated markets worldwide. https://www.soft2bet.com/news/understanding-the-role-of-compliance-in-igaming An +More Media publication. For sponsorship inquiries email scott@andmore.media. |
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