Tuesday, September 27, 2022

Genting sees strong online growth, says U.K. main focus


Genting says its U.K. licensed interactive business will remain the focus for its online gambling push, despite a recent headline grabbing tie up with online gaming company bet365 in New York.

Empire Resorts, which is indirectly controlled by Genting, has entered into a 50/50 revenue share deal with bet365 for its Resorts World Catskill property. The operator plans to launch a bet365-branded sportsbook in New York should the state opt to regulate sports-betting after PASPA was overturned in May this year.

The accord will also see the online company take a 5 percent stake in Empire Resorts.

Genting controls Empire via the 88 percent majority stake of the Lim family investment vehicle Kien Huat Realty. In the same announcement, Kien Huat said it had agreed to buy $126 million of convertible preferred shares in the company

Analysts in the UK speculated that the New York move might be seen as part of a broader match-up between Genting and bet365. Simon French, partner at management advisory and consultancy Bixteth Partners, said the 5 percent stake in particular was intriguing.

“Is this the start of bet365 looking at becoming a global, omni-channel operator? Or is this just the price of entering the market?” he questioned. “The move is particularly interesting given bet365's reportedly huge Asian business and Genting’s position in Asia, but also soon in Nevada. It is quite possible we might see bet365-branded sportsbooks in Genting casinos. This could be a big strategic play.”

This does not represent Genting’s first foray into either online gambling or sports-betting. The company’s UK operation has been running with a multi-channel effort for some years. According to figures available via Companies House for Genting UK, in the year to December last year, the interactive division, which includes both online casino and sports-betting, made £8.6 million ($10.9 million) out of total UK revenues of £337.7 million.

Jeremy Taylor, managing director of Genting Interactive based in Birmingham, UK, says the unit works as a form of online incubator within the global Genting organisation.

“Genting has always been seen as a land-based brand but we are gaining traction online and we are working to build it up,” he adds.

Taylor suggests there is scope within the UK market and elsewhere in Europe for Genting to take its online business “to the next level.” “(The Genting name) has not been properly exploited yet in the UK or elsewhere,” he says. “There is no ceiling for our plans. We are UK-only for now but we are looking at some European markets.”

Taylor, who only joined the business in September from Betsson, wouldn’t be drawn on any online plans beyond Europe, either in the US or Asia. But he did add that the company has recently opened offices in Malta and would be looking to improve its product and refine its brand positioning in the year ahead.

He also noted that revenue growth for the interactive business would be “significant” for 2018.

The interactive business is largely casino, attempting to leverage the Genting land-based casino name in the UK, but with an added sports-betting element provided by sports-backend supplier FSB Technology.

David McDowell, chief executive at FSB Technology, said that Genting was his company’s first fully-managed sports-betting service although the company now works in regulated markets with other Asian-facing clients including Dafabet and 138bet. “We have enjoyed working with Genting over the past five years and look forward to supporting the company’s growth plans in the future.”

According to analysts in its home market Genting Malaysia could certainly do with a boost, whether that comes from the online business or from the US, after recent actions on the part of the Malaysian government.

According to a recent note from analysts at Alliance DBS in Kuala Lumpur, the shares of parent company Genting Malaysia remains under pressure due to the announcement by the government of the so-called sin tax on gaming machine operators.

“The punitively high casino tax and increased casino licences fees announced by the federal government in the 2019 budget (at the end of October) surprised even the most bearish forecasters and will adversely impact the group’s earnings prospects,” wrote analyst King Yoong Cheah.

He added that “to sustain earnings growth” the company has been actively expanding its gaming operations in the UK and US. “As such, the group’s overall financial performance is increasingly exposed to risks in these countries.”

 

Asia Gaming Brief is a news and intelligence service providing up to date market information for worldwide executives on relevant gaming issues in Asia.

3rd party / Cookies
Show settings
Contact us

ASIA GAMING BRIEF
PO Box 1139, Macau SAR
Tel: +853 2871 7267
Fax: +853 2871 7264

Asia Gaming Brief