Austerity tax revenue has dragged the third-quarter profit of Greece-based OPAP down to 40 percent.
OPAP, Europe’s fourth-biggest betting firm, saw its profit tumbling to 29.3 million euros ($31 million) in the July to September 2016 period compared to the 49.1 million euros in the same period a year ago, according to Dailymail.
It fell short of analysts’ average forecast for net profit of 33.4 million euros (US$35.20 million).
The drop in the profit of OPAP was attributed to a retroactive tax hike on gaming revenue that it has generated since the start of the year. Greece implemented a tax hike on OPAP’s revenue by 5 percentage points to 35 percent as part of an international bailout, the third since 2010.
OPAP, which was fully privatized in 2013, currently offers sports betting and lotteries through a network of about 5,750 outlets in Greece and Cyprus.
On the flip side, OPAP’s gross gaming revenue was up 6 percent to 319 million euros (US$336.25 million), thanks to the robust performance in flagship lottery Kino and a scratch card.
Meanwhile, OPAP announced that it will launch video lottery terminals (VLTs) from the end of the first quarter next year.
It plans to roll out some 16,500 machines in the next 18 months at existing and newly set-up outlets, Chief Executive Officer Damian Cope said in a call to analysts.
OPAP had been eyeing to introduce the machines last year but it was put in the back burner after Greece unexpectedly introduced tougher betting rules. It would be recalled that the gambling firm took the Greek state to the London Court of International Arbitration, claiming damages of more than 1 billion euros (US$1.05 billion) as a result of the frozen plan.
The company unfroze the project this month after Greece’s gaming commission approved new, less rigid regulations. Cope believe that the size of OPAP’s legal claims against the state will significantly drop after recent developments.
“The overall deployment of legally licensed VLTs is a brand new development for both OPAP and the Greek market, so we will be analyzing our performance carefully as we go along,” he said.