Ontarians bet $4 billion, market produces $162 million revenue in Q1

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The public can finally see the numbers that indicate how Ontario’s new regulated online sports betting and iGaming market is performing since its launch on April 4.

Ontarians wagered more than $4 billion (CAD) and the market produced $162 million in total gaming revenue, from iCasino, online sports betting and online poker, during the period from April 4 to June 30, according to the first earnings report published by iGaming Ontario. . (As of August 30, $1 CAD is equal to $0.76 USD).

The $4.076 billion in total wagering does not include promotional bets, and the total gaming revenue of $162 million is total cash wagering, including rake fees, tournament fees and other fees across 18 total operators and 31 gaming websites.

The regulator also reports that there were 492,000 active player accounts with an average monthly spend of $113 per user.

“Our goal is to be the best gaming jurisdiction in the world and these positive results are an early sign that we are on our way,” said Dave Forestell, chairman of the iGO board of directors, in the statement. “With a competitive revenue share rate and low barriers to entry, Ontario is an attractive gaming market with a strong player base.”

The regulators have also formally announced that they intend to publish these reports at least quarterly going forward. They also promise more metrics related to gaming product segments, player protection, player demographics, and the economic impact of the iGaming industry.

It is important to note that these figures do not include iGaming revenue from the Ontario Lottery and Gaming Corporation, which offers a comprehensive iCasino and online and retail sports betting platform. PROLINE+ was the first online sports book to launch in Ontario shortly after Canada decriminalized single event betting on August 27 last year.

It is also unclear how much revenue the former gray market (now black market) operators, who have been in business for decades in the province, have generated during this time. The black market and offshore sports betting market in Canada was valued at $14 billion before the launch of the new regulated market, according to the Canadian Gaming Association.

Data delay until ‘diligence’

Many industry stakeholders expressed frustration at the delay in releasing the first earnings report after regulators declared at the Canadian Gaming Summit in June that it would be released “very soon.”

The delay was addressed in iGO’s email release:

“We realize this report has been highly anticipated and appreciate your patience for the time and diligence required to achieve the desired accuracy of this data.”

Provincial elections in Ontario were held on June 2, and the government led by Doug Ford of the Progressive Conservative Party was re-elected. Many elected government officials take considerable vacation time during the summer months, which may have slowed down government administration processes.

CGA President Paul Burns previously said sports handle the numbers were experiencing an administrative backlog.

“It’s nothing with a purpose. They [regulators] needs signature. And I don’t think they have that yet. When they do, they will release them. They want to free them. I know the operators want to see them,” he said.

The province’s 2022 spring budget estimated that iGaming Ontario will generate net revenue of CAD$18 million in 2022-23, $26 million in 2023-24, and $31 million in 2024-25.

How does Ontario compare?

Looking at four US states that offer some comparable quarterly metrics to Ontario, two states, Pennsylvania and Connecticut, provide monitoring for both sports betting and electronic gaming. Two others, New Jersey and Michigan, have estimates for iGaming handling based on a 2.78% hold. That withholding was based on the combined driving and revenue totals for Pennsylvania and Connecticut.

Ontario regulators did not provide a breakdown of revenue by discipline, so we are left to guess what the weight of the relationship between sports betting and iGaming was.

Here are some comparable Q2 revenue figures from US states (April-June) to Ontario, which is home to approximately 15 million Canadians, from sports handleThe Wizard of Numbers Chris Altruda (figures in US dollars):

Pennsylvania (population: 12.79 million)

  • Sports betting handle: $1,459,662,482
  • Gross sports betting receipts: $119,801,438
  • Manage iGaming: $11,969,823,536
  • iGaming Gross Gaming Revenue: $329,339,072
  • Total sports betting and iGaming handling: $13,429,486,018
  • Total gross income from sports betting/iGaming: $449,140,510

Handle breakdown: 89.13% iGaming/10.87% sports betting
Income breakdown: 73.33% iGaming/26.67% sports betting

Connecticut (population 3.57 million)

  • Handle sports betting: $327,067,206
  • Gross sports betting receipts: $24,472,874
  • Manage iGaming: $2,210,211,971
  • iGaming Gross Gaming Revenue: $64,644,035
  • Total sports betting and iGaming handling: $2,537,279,177
  • Total gross income from sports betting/iGaming: $89,116,909

Handle breakdown: 87.11% iG/12.89% SW
Income breakdown: 72.54% iG/27.46% SW

Michigan (population 9.97 million)

  • Sports betting handle: $1,044,529,609
  • Gross sports betting receipts: $84,377,332
  • iGaming management (estimated): $13,716,946,079
  • iGaming gross game revenue: $381,331,101
  • Total sports betting and iGaming management: $14,761,475,688
  • Total gross sports betting/iGaming revenue: $465,708,433

Handle breakdown: 92.92% iG/7.08% SW
Income breakdown: 81.88% iG/18.12% SW

New Jersey (population 8.89 million)

  • Sports betting handle: $2,326,543,993
  • Gross sports betting receipts: $151,185,037
  • iGaming management (estimated): $14,605,707,302
  • iGaming gross game revenue: $406,038,663
  • Total sports betting and iGaming handling: $16,932,251,295
  • Total gross income from sports betting/iGaming: $557,223,700

Handle breakdown: 86.26% iG/13.74% SW
Income breakdown: 72.87% iG/27.13% SW

Based on these comparable numbers, and assuming Ontario consumers have somewhat similar gambling habits to nearby US states, iGaming could account for approximately 90% of the $4.076 billion in total wagers announced for the first quarter in Ontario. .

just the beginning

Ontario’s early revenue figures aren’t mind-boggling, but they were never expected to be.

Many private operators and industry stakeholders have described the launch of Ontario’s regulated market as a marathon, not a sprint. The general consensus is that it will take a full calendar year to get an accurate picture of the market’s potential.

Gray market operators have dominated the Canadian and Ontario market for decades. Two operators estimated to have a large market share in Ontario, Betway and Sports Interaction, have recently converted to the regulated market. A few more such as Pinnacle, BetRegal and Bet99 are also expected to join soon. Once these five carriers are running at full capacity, the revenue figures should be much more accurate.

The Ontario Alcohol and Gaming Commission has proposed a new standard that would set October 31 as the deadline for operators to exit the unregulated market. A strict deadline would push gray operators currently in limbo to obtain a license.

The proposed standard will create an obligation for operators and providers to cease any direct, unregulated activities in Ontario, and to terminate any agreements or arrangements with third parties that are conducting activities. in the unregulated market. Implementation of this proposed Standard may require some applicants to close their Ontario gaming sites until they have met the requirements of both AGCO and iGaming Ontario (iGO).

Another factor to keep in mind is that the market launched at an inopportune time for traders, on April 4th. Ontario punters did not have the ability to bet on major events like the Winter Olympics, the Super Bowl, and the NFL season.

Third-quarter revenue figures from Ontario regulators should reflect high anticipated betting interest in NFL, FIFA World Cup and CFL Gray Cup games, while other popular sports in the province such as basketball and hockey will also be in full swing.

Finally, the Ontario market is expected to grow considerably throughout the year. As many as 70 different brands could be licensed in Ontario by the end of the year, regulators said at the Canadian Gaming Summit. Given that the revenue data only accounts for 18 operators and 31 gaming sites in the first quarter, these numbers should rise sharply as more operators come on board.

Carrier comparison not available

Unfortunately, the regulators’ earnings report on Tuesday did not include any information on the operators’ market share.

However, early market research suggested that bet365, theScore Bet and FanDuel had the most downloaded apps in the first month after market launch.

PointsBet, which was one of the first operators to launch in Ontario on April 4, released some data on its performance in Ontario during its Q4 (April-June) investor presentation in July.

The operator reported approximately $14.32 million (CAD) in handling, and its 4.2% profit margin translated into approximately $630,000 (CAD) in gross profit after paying customers.

Many other carriers refrained from publishing any Ontario financial information until regulators released the first earnings report. We could see a flood of information from individual traders shortly now that those floodgates have been opened.

“The market report released today by iGaming Ontario speaks for itself. With 492,000 active player accounts, the total cash bets of [$4.076-billion]and a total gaming revenue of $162 million, the desire for a regulated market is strong,” PointsBet Canada CEO Scott Vanderwel said in an emailed statement after regulators released the revenue data on Tuesday.

According to the VIXIO Gambling Compliance Canadian Online Data Dashboard, the Ontario iGaming market is estimated to generate gross gaming revenue of approximately $1.6 billion Canadian dollars this year, rising to $2.36 billion in 2023.

Chris Altruda contributed to this article.


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