Every week, CasinoBeats breaks down the numbers behind some of the industry’s most fascinating stories. Our latest headline reflection features a multi-million-pound Entain settlement, the latest regulatory update in the UK and Kindred’s North American exit.
As the result of a bribery investigation into Entain, the operator group agreed to a £585m settlement with the Crown Prosecution Service.
The probe came from the company’s previous Turkish subsidiary Headlong, which was sold in 2017, with the Ladbrokes and Coral-owner now set to pay the multi-million-pound settlement to HMRC.
As the illegal activity occurred before Entain’s rebrand from GVC Holdings in 2020, the operator has emphasised the bribery issue is one of legacy and that it has since transformed as a company.
Chairman Barry Gibson commented: “This legacy issue pertains to a business divested by a past management team six years prior. The company has undergone significant changes since then, and the DPA process has underscored the profound evolution from the GVC of the past to today’s Entain.
“We remain focused on advancing our operations exclusively within regulated markets and are acknowledged as a leading, responsible entity with unparalleled corporate governance across our business.”
Inspired Entertainment faces being delisted from the NASDAQ after it failed to publish its financial results for 2023’s third quarter.
The igaming provider failed to submit form 10-Q to the Securities and Exchange Commission, leading to NASDAQ authorities giving the firm 60 days to publish its results or it will be delisted from the exchange.
The firm has until January 22 to publish its Q3 performance, with the option to extend this date by an additional 180 days to May 7 if the company publishes a plan deemed acceptable by the exchange.
Earlier this month, the group noted that it needed an extension to publish its Q3 results following an audit from KPMG that identified accounting errors with US GAAP within the results.
Inspired statement read: “Although the Company cannot at this time estimate when it will file the amended reports, it is diligently pursuing completion of the restatement and intends to make such filings as soon as reasonably practicable.”
As the UK’s Gambling Act review continues to add uncertainty to its gambling sector, the UK Gambling Commission has begun the second round of white paper consultations.
The second batch of consultations will cover socially responsible incentives; customer-led tools; transparency of protection of customer funds; removing commission requirements that would become obsolete due to the government’s upcoming statutory levy; and regulatory data.
Tim Miller, UKGC Executive Director for Research and Policy, commented: “The White Paper set out that a top government priority is ensuring that gambling happens safely. We share this commitment and today’s consultations propose how we can deliver on it.”
“We need as many people as possible to have their say on any potential changes to the rules operators must follow. These views will ultimately help shape gambling regulation across the country.”
The second round of consultations will run for 12 weeks, closing next year on February 21.
Furthermore, the UKGC will also shortly launch two additional consultation topics – financial penalties and financial key event reporting.
Kindred has revealed plans to completely exit the North American market, included as part of the company’s strategic review that is also seeing it reduce staffing by 300 employees.
Aiming to result in approximately £40m in annual savings, Kindred will exit North America by the end of Q2 2024, following the strategic review initiated back in April.
Interim CEO Nils Andén said: “The cost reduction actions announced today are both necessary and decisive.
“While it is never a desire to inform valued colleagues of redundancies, this puts us in a stronger position to secure long-term growth for Kindred across our locally regulated core markets.
“We can now focus our resources and tech capacity towards strategic initiatives and selected markets where we see clear potential to grow our market share.”
The announcement came alongside the operator group’s Q3 results for 2023, which saw Kindred publish year-to-date revenue growth of 18 per cent to £897m.
Within the Q3 trading period, revenue stood at £283.9m, showing an increase of two per cent on Q3 2022’s £277.8m. Meanwhile, Q3 EBITDA stood at £33.9m, a sizable drop of 55.57 per cent from the previous year’s £76.3m, while underlying EBITDA came in at £42.6m, an uptick of 5.7 per cent.
Dutch gambling authority Kansspelautoriteit imposed a €3m fine on Entain-owned BetEnt for violations of the Money Laundering and Terrorist Financing (Prevention) Act.
BetEnt, operator of sports betting brand BetCity, was initially instructed by KSA in September 2022 on how to properly carry out customer due diligence per the requirements of the Wwft Act and how to report them to the Dutch Financial Intelligence Unit promptly.
After being investigated by the KSA to see if the Wwft was still being violated, it was found that the operator “did not meet the requirements for a large part of the customer due diligence assessed” between December 2022 and May 2023.
KSA noted that investigations by BetEnt began late, as well as after large amounts of money had already been gambled and that the operator “was lax in requesting sources of income from customers”.
Adequate action was also not always taken and in many situations, BetEnt “failed to report unusual transactions to the FIU”, which is why the €3m fine has been imposed.
Entain released a statement in response to the fine imposed on BetCity, stating that it was aware of the previous instructions issued by the KSA before it completed the acquisition of the sports betting brand in January 2023.
The gambling group added that it has begun introducing improvements to BetCity’s procedures and has fully cooperated with the KSA’s investigation.
Kaizen Gaming-owned brand Betano has confirmed a global sponsorship deal with the upcoming 2024 UEFA European Football Championship taking place in Germany.
It builds on the operator’s links to the World Cup last Summer, as it continues to build its brand through sporting collaborations.
“We are thrilled to be partnering with UEFA for the upcoming EURO 2024 tournament,” commented George Daskalakis, CEO and Founder of Kaizen Gaming
“This collaboration is a new first for the industry and expresses our fundamental passion for football as well as our mutual commitment towards innovation and excellence.
“We are very excited to be part of this football celebration and are looking forward to enhancing the overall fan experience by delivering unparalleled entertainment through responsible gaming during this highly anticipated European Championship.”