Home > Finance > Half year results > PointsBet CEO says NA strategy is delivering despite growing losses in H1

PointsBet CEO says NA strategy is delivering despite growing losses in H1

| By Marese O'Hagan
PointsBet reported revenue of AU$178.1m (£989,877/€1.1m) in its half-year results ended 31 December 2022, up by 28% yearly, but losses widened to AU$178.2m.

The net loss grew by 21.7% year-on-year. Much of the costs during the six month-period went to PointsBet’s American operations – operations that also happened to be an important part of the business’ revenue results, making up AUS$75.0m of the total. This was 86.1% higher than in H1 2022.

PointsBet launched its sports betting product in Kansas and Louisiana in September 2022, followed by Maryland in November when the state’s market officially opened.

By the time the half-year period had ended, PointsBet was live with mobile betting in 14 states, retail wagering in three and online casino in four.

Since then, in January, PointsBet launched a new retail sportsbook in Illinois, marking its fourth retail location.

Sam Swanell, managing director and group CEO at PointsBet, said that the operator had performed strongly in the US during the period.

“These results show our North American strategy is delivering – revenue growth is up and costs are going down,” he said. “In the United States, the largest and fastest growing online betting market in the world, we are the seventh largest online gaming operator, out of a field of over 60 licensed online operators.”

He also praised the operator’s Australian results, despite revenue slipping slightly from AU$97.6m in half year 2022 to AU$95.3m.

Last month, PointsBet entered discussions to sell the Australian arm of its business to NTD Limited, a venture headed by News Corp. NTD Limited operates the Betr brand in Australia.

Betr, which was founded by influencer Jake Paul and Simplebet co-founder Joe Levy, was first launched in August 2022.

“The Australian business is continuing to deliver,” he continued. “In Australia, total turnover was AU$1.55bn, up 14% on the prior corresponding period (PCP) and total net win was AU$105.3m, down 2% on the PCP.”

Breakdown by region

PointsBet generated AU$6.7m in revenue from its Canadian operations, for which there was no prior corresponding figure as the Canadian sports betting market opened on 4 April 2022 . Technology contributed the remaining AU$1.1m in revenue, a fall of 9.0% yearly.

Total handle for the period was AU$3.2bn, up by 39.8% year-on-year. Here, the US contribution was highest, at AU$1.57bn – a significant rise of 66.0% yearly.

Handle from Australia was AU$1.55bn, increasing by 14.1%. For Canada, handle was AU$101.3m.

Total sports betting net win came to AU$158.2m, up by 13.6%. By region, sports betting net win remained largely stable in Australia, dipping by 2.4%.

However this was slightly more dramatic in the US, where sports betting net win grew 62.0%.

PointsBet H1 results

Cost of sales, totalling AU$108.2m, resulted in net profit of AU$69.8m. This net profit was 27.6% higher than in the previous year’s H1.

Other income at AU$3.7m – consisting of net foreign exchange gains of AU$3.6m and research and development income at AU$115,000 – offset this slightly.

Turning to expenses, marketing costs at AU$131.3m were the highest of the period. This was followed by employee benefits expenses at AU$74.9m and depreciation and amortisation costs at AU$22.5m.

The remaining AU$26.8m stemmed from a variety of other costs, including consulting expenses and administration expenses.

For the six-month period, expenses totalled at AU$255.6m – AU$57.3m higher year-on-year.

Following finance income at AU$4.6m and finance expenses at AU$2.1m, the loss before income tax was AU$179.6m.

After considering income tax benefit of AU$1.4m, the total loss for the period hit AU$178.1m.

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