Chartwell has bad Q4; Française des Jeux has record year

TAGs: Chartwell Technology, FDJ, Francaise Des Jeux, France

francaise-des-jeux-chartwell-technologyCanadian-based Chartwell Technology’s Q4 revenue dropped over 30% in the three months ending Oct. 31, 2010. The online gaming systems provider cited the loss of a “significant’ customer (Betfair) in August as the principal cause of the decline. The company did sign new agreements with Globet, Centrebet and (most recently) Rank Interactive as well as renewed license agreements with Victor Chandler, Stan James, Mybet and Doxxbet.

Chartwell’s total revenue for the year was $12.1m, a 23% drop from 2009’s $15.6m. The company estimates that half of this annual decline can be blamed on the Canadian dollar’s continued strength at the expense of Sterling and the Euro. Net losses on the year were $7.1m vs. a loss of $2.7m in 2009.

Things were considerably brighter on the ledgers of Française des Jeux (FDJ). The state-owned French operator, which runs the national lottery and the former monopoly sports betting outfit, had a banner year. Turnover topped €10.5b, a 5.5% increase over 2009 and the first time the company has recorded double-digit billions. Despite having to face competition online this year, the sports betting arm was up 46% to €1.142b. Not for nothing did FDJ President Christophe Blanchard-Dignac proclaim “these results are even better than everything we imagined they could be.”

Blanchard-Dignac tried to lower expectations for 2011, saying growth would likely be in the 3% range. That’s around what former horse-betting monopoly Pari-Mutuel Urbain (PMU) recorded this year, with a turnover of €9.5b. Compare that to the total €4b recorded by all the other betting companies that entered the French market midway through the year and you might see why Betclic Everest president Stéphane Courbit believes the two former monopolies have an unfair advantage in marketing their products.

This last point was backed up by the French Competition Authority, whose recent report expressed concern that the “availability of PMU and FDJ’s [38,500] offline points of sale, under preferential conditions, to develop their online activities that are subject to competition, could lead to a distortion at the expense of alternative operators that don’t have such opportunity.” Couple that with France’s punitive taxation scheme and poor rate of return to the punter and the French market increasingly looks like a rigged contest.


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