PointsBet CEO Confident Ahead of Gambling Regulatory Changes
LISTEN TO THIS ARTICLE:Sam Swanell, the CEO of PointsBet, has expressed confidence in his company’s ability to adapt to the expected regulatory changes in the Australian gambling industry. However, he said that while PointsBet, valued at $294 million, is well placed to handle these changes, smaller betting firms are likely to face difficulties in a changing market environment.
PointsBet has notably reduced its marketing expenses by 30 percent in the first half of the current financial year. It has also worked to move away from "bonus chasing" bettors who primarily engage in response to special offers.
Anticipation over Government Announcement on Gambling Regulations
The federal government is expected to announce changes to gambling regulation. The changes were spurred by an inquiry into gambling harm, which made a number of suggestions including a ban on inducements and the banning of gambling adverts within three years.
The government’s response was first expected last November, but according to a spokesperson for Communications Minister Michelle Rowland, it is still to be decided upon.
I think we’ll end up in a reasonably rational position that will involve some changes, ones we advocate for. I think there’s zero chance of a ban on all inducements, but there will be marketing implications. We’re already advertising within where we think the regulation will come into effect.
Swanell went on to explain that he believes the advertising ban combined with the increased cost of living and increases to point-of-consumption tax will be ruinous for smaller operators.
A Positive Outlook for PointsBet
Last year, PointsBet finalized the sale of its US business to Fanatics for $225 million. The company is now predicting positive earnings before interest, tax, depreciation and amortization in the next financial year following the completion of the sale.
Swanell has confirmed that the company is expecting a normalized loss for the 2024 financial year in the region of $9 million to $14 million when the sale of the US business and some other one-off payments are not taken into account.
Furthermore, the company is predicting that its net win from its Australian and Canadian businesses to increase by 10% to 20% this financial year in comparison to last year’s $230 million. PointsBet has already seen its net win increase 11% in Q2, thanks to strong growth in Canada.
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