BUSINESS

SNAI fortunes worsen in 2012; Italy betting shop tender oversubscribed

TAGs: AAMS, betting shop, Eurobet, Italy, Lottomatica, sisal, Snai

italy-snai-bet-shop-tenderLeading Italian gaming operator SNAI turned in a 2012 earnings report card that provides further evidence of the company’s sliding fortunes. For the year, SNAI reported a loss of €42.6m, a worse performance than the €40.5m it lost in 2011. Overall revenue fell 7.9% to €514.4m and earnings fell 34% to €64.5m. SNAI also increased its debt load by €15.2m, bringing its total debt to €369.6m. This is the last set of results under CEO Stefano Bartoli’s watch, as he recently announced he’d be stepping down after a mere 18 months at the helm, with chairman Giorgio Sandi agreeing to assume the CEO mantle.

Credit/blame for the downturn goes to last April’s payout fiasco with SNAI’s Barcrest-supplied video lottery terminals (VLTs), which resulted in the company temporarily taking its machines offline and eventually being slapped with a multi-million-euro fine by Italian gaming regulator AAMS. Despite the Euro 2012 footie fest and the Olympics, sports betting turnover was flat at €3.94b, while the payout to punters increased to 82.7% from 78.3% in 2011. SNAI’s dominant position in the horseracing market was no help, as turnover fell 26%. On the plus side, online gambling turnover rose 16.7% to €5.6b last year thanks to the introduction of online slots and “a positive response” to its Playyoo-developed mobile and tablet app.

SNAI is one of the main participants in Italy’s oft-delayed tender for 2,000 new betting shop licenses. The new licenses are free of the geographic restrictions of previous tenders, leaving only local council permission required for approval. The tender has reportedly attracted 115 bidders filing some 2,800 license applications, meaning somebody’s going home unhappy. With more pigs than there are teats, it’s believed that only those who offered more than twice the €11k sticker price stand a shot at winning their bids.

GamblingCompliance reported that Eurobet was the most eager suitor, filing 400 bids ranging from €21k to €43k and 100 bids between €70k and €81k. Eurobet already operates 400 points of sale in the country and, given the generosity of its bids, appears set to become one of the country’s leading operators. SNAI has offered bids between €11k and €53k for 330 licenses, SISAL has offered between €16k and €45k for 325 licenses and Lottomatica filed 300 bids ranging from €19k and €47k. Slots operators are also in the race, looking to use the licenses for VLT and amusement with prizes (AWP) operations. AAMS is expected to announce the results of the tender before the end of April.

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