Loto-Québec posts annual revenue decline despite strong online growth17th June 2014 8:36 am GMT
Canadian provincial lottery operator Loto-Québec has reported a 3 per cent increase in revenue to CAD$3.5bn for the year ended March 31st, with the company’s online gaming products generating a total of $41.9m during the period.
Revenue fell across all of the operator’s business segments, with Loto-Québec’s core lottery business posting a marginal 1 per cent decline to $1.8bn.
Full Year 2013/14 Revenue
|Canadian Dollars (CAD$)||FY 2012/13||FY 2013/14|
Revenue from draw games were down 3 per cent to $1.2bn, despite a 6 per cent increase in Lotto 6/49 revenue, while instant games revenue rose 4 per cent to $468.1m.
Online lottery sales more than doubled to $16.0m, from $7.1m in the previous year, while online casino revenue rose 11 per cent to $25.9m. Overall, the online channel saw revenue increase by 37 per cent compared to the previous year.
Loto-Québec estimates that it holds a 20 per cent share of the online gaming market, but warned that the illegal gaming market was a growing problem, urging the government to implement new solutions to control the supply of online gaming across the province.
Overall casino revenue fell by 6 per cent to $797.0m following declines across all four of the company’s casinos, with Casino de Mont-Tremblant suffering the biggest drop as revenue fell 17 per cent. Casino de Montreal contributes the most in revenue, $489.9m, followed by Casino du Lac-Leamy with $242.7m.
Video lottery revenue was down 3 per cent to $940.7m, while bingo revenue fell marginally by 0.1 per cent to $36.9m.
Cost of sales amounted to $1.4bn, while expenses rose 3 per cent to $996.3m. As a result, operating profit fell 10 per cent to $1.2bn, with net profit for the year dropping 10 per cent to $1.1bn.
“Given the current economic climate (mature market, fierce competition, the challenge of attracting a new customer base), one thing stands out: Loto-Québec will need to be more efficient than ever,” said the company in a statement. “Particular focus will be placed on that aspect in the course of 2014-2017 strategic plan development. The effort will also involve a review of how things get done and priority setting in order to control expenses even more tightly.”