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NeoGames boosted by ilottery US growth

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CEO Moti Malul hailed NeoGames’ ilottery growth in the US after the provider’s Q3 earnings increase against the backdrop of progress towards its acquisition by Aristocrat Leisure.

Malul said the online gambling solutions provider is on track to complete the Aristocrat deal next year.

“We continue to make progress towards completing our merger,” Malul stated. “During this quarter we have received additional regulatory approvals which are required to close. We continue to expect the deal to be completed during the first half of fiscal year 2024.”

In May Aristocrat agreed to pay $1.20bn (PS921.2m/EUR1.07bn) to acquire the provider’s shares. Since then, NeoGames’ board and the provider’s shareholders have overwhelmingly voted in favour of the deal.

Earnings increase

In NeoGames’ Q3 financial update, adjusted earnings totalled $19.9m in the three months – a 13% year-on-year increase.

A change in accounting from gross to net revenue for the company’s Aspire Core division meant sales fell. This alteration was due to new commercial terms in certain Aspire Core contracts.

However, despite the $10m decline to $63.3m year-on-year, NeoGames stated that like-for-like figures would have reflected an 11.5% revenue increase.

Accordingly, NeoGames reduced its net loss from $4.4m to $3.6m year-on-year in Q3. In the first three quarters, the net loss fell from $18.2m to $12.2m. This helped to drive a sharp increase in adjusted earnings in the first nine months from $36.4m to $58.0m.

“Our ilottery business continues to win market share and grow,” said Malul, who singled out the US for vital expansion.

The company’s joint venture, NeoPollard Interactive (NPI), recently expanded its US footprint through a deal with the West Virginia Lottery. It is the fifth state in which NPI will operate a full ilottery programme. Additionally, there was a deal with the North Carolina Education Lottery.

NeoGames’ ilottery revenues reached $14.4m in Q3 – up from $13.7m last year. The company’s share in NPI revenues also rocketed by 53.3% to $17.0m from $11.1m in the quarter.

The company does not believe there will be “any material impact on its ongoing operations in Israel”.

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