Clock winds down on casinos in Russia...and more EMEA news



Clock winds down on casinos in Russia

Russian President Dmitry Medvedev confirmed the federal government’s intention to ban the gambling industry from the country.

Mikhail Mokretsov, head of the country’s Federal Tax Service, has signed an order to that effect after meeting with Medvedev, according to a report in The Kommersant newspaper posted on Pravda’s news site.

All casinos and slot arcades were ordered to shut down their activities before July 1 in accordance with a law passed by the Duma and signed by President Vladimir Putin back in 2006 outlawing casinos and slot halls in major population centers.

Tax Service officers will be on the lookout for gambling establishments that attempt to disguise their operations, officials said.

“There will be no way back, no matter how hard certain business structures might lobby such decisions,” Medvedev said.

Municipal officials in Moscow, where most of the business is located, said they had the situation “under control,” Pravda reported.

Deputy Mayor Sergey Baidakov said authorities would not let gambling operations reappear as poker clubs, which remain legal. Those wishing to open poker clubs have to apply for certification from the city’s Department for Physical Culture and Sport. Poker is officially considered a “sport’ in Russia.

One casino operator who spoke on condition of anonymity said gambling in Russia would not cease to exist but would go underground in large numbers. He said players will find plenty of accommodating clubs in Moscow and other parts of the country.

Other operators are busily relocating to the republics of the former USSR, to Eastern Europe and as far away as Latin America.

SPAIN LESS THAN SUNNY FOR WILLIAM HILL

Tough economic conditions have prompted William Hill to exit its Spanish joint venture with Codere Group.

The withdrawal will be gradual for the UK-based bookmaking giant, which will continue to provide bookmaking services to Victoria Apuestas, as the Spanish business is branded.

The joint venture opened its first betting outlet in April 2008 and quickly grew to 98 shops in Madrid and the Basque region. Which in itself resulted in difficulties, according to Hills.

“Achieving this scale has proved problematic because of the slow granting of local regulatory consents and the slower-than-anticipated regulatory changes within other regions,” the bookmaker said. “These factors, coupled with the difficult economic situation within Spain, were likely to lead to additional capital requirements and a delay in achieving William Hill’s target return for the venture.”

Victoria Apuestas generated a meager €800,000 in operating revenues from sports betting in the first quarter, resulting in a pre-tax loss of €1 million.

It is Hills’ second disappointment on the continent. The company pulled out of the Italian market last year.

FDJ TAKING PLUNGE WITH FREE-PLAY SITE

French betting and lottery monopoly Francaise des Jeux is expected to go live with a free-play online offering this summer in preparation for the real thing in 2010.

Said news portal Gaming Intelligence, “As private European operators strive to build market share under the restrictive gaming laws currently in force in France, FDJ’s play-money offering will provide it with an opportunity build an online customer base, as well as enabling it to iron out any technical and operational issues prior to launching real-money gaming next year when the country’s new gaming law comes into force.”

FDJ is collaborating with CyberArts on development of a poker site. Bingo will also be in the portfolio under a licensing agreement with Nyx Interactive, a platform provider based in the Isle of Man. Nyx also provides online bingo to Sweden’s state monopoly Svenska Spel.

PROFITS DOWN 83 PERCENT IN A VERY BAD YEAR FOR HOLLAND CASINO

Operating profit fell 83 percent at Holland Casino last year as the combination of a recession, a new smoking ban, higher taxes and Internet competition continued to hammer the Netherlands’ state-run monopoly.

Visitation was down 500,000 to 6.9 million, contributing to a decline in profit from €85.6 million in 2007 to €14.3 million on a 44 percent drop in EBITDA to €80.4 million. Revenues were down 7.5 percent to €700 million.

“In 2008, we took hits from all angles,” said CEO Dick Flink.

Holland Casino believes increasing numbers of Dutch smokers are deserting its 14 casinos for the Internet, costing the company “tens of millions of euros,” Flink said.

The company had sought an exclusive license to operate online poker and casino games but the proposal was rejected by the Dutch Senate last year. It is estimated that 485,000 Dutch citizens are gambling online, a market valued at €477 million a year, and they’re doing it on foreign Web sites.

The tax rate on gambling machine income was effectively doubled last July, and that also has hurt results, the company said.

National Lottery still Britain's remote game of choice

The proportion of British adults participating in remote forms of gambling has risen to its highest level in four years, according to the latest survey data published by the UK Gambling Commission.

Driven by the National Lottery, remote gambling participation, which includes Internet, mobile and iTV, increased to 9.9 percent for the year through March, compared to 9.7 percent in 2008, 8.8 percent in 2007 and 7.2 percent in 2006. Of those who said they participated in at least one form of remote gambling during the year, 43.5 percent had gambled only on National Lottery games. Excluding the Lottery, participation was relatively flat from 2006 to 2008 at slightly more than 5 percent.

The survey, conducted quarterly, polls a nationally representative sample of 2,000 adults.

The National Lottery draw was once again the most popular activity undertaken during the year at 7.5 percent, followed by sports betting at 2.6 percent, Lottery scratch cards at 2.4 percent, poker at 1.8 percent, other lotteries at 1.6 percent and casino and bingo at 1.0 percent and 1.1 percent, respectively.

Participants were most likely to be male, with 12.2 percent of men having played remotely versus 7.7 percent of women. The most active age group was 25–34 years old, with 15.9 percent of respondents within that group participating.

The Internet was still the most popular method of remote gambling, followed by mobile and interactive TV.

GTECH, BELGIUM IN DEAL TO TAKE LOTTERY ONLINE

GTECH has signed a new four-year contract with Belgium’s La Loterie Nationale to provide interactive gaming services.

The agreement calls for GTECH, which has been in Belgium for 16 years, to install its Es New Media e-commerce solution on La Loterie Nationale’s system, enabling sales online of traditional lottery style games such as EuroMillions, Pick 3, Keno, Joker, Lotto and instant games and providing the ability to expand to other interactive games and other platforms such as interactive television and mobile.

“We are confident this will open up a whole new way of doing business with new clients and thus will expand our commercial potential and our profitability in a socially responsible way,” said Ivan Pittevils, La Loterie Nationale’s chief executive.

GTECH recently signed an agreement with Société de la Loterie de la Suisse Romande to deploy Es New Media for Switzerland’s French-speaking market.

Italian lottery and gaming operator Gruppo Lottomatica, GTECH’s parent company, reported a stellar first quarter, growing profits 69 percent to €71.9 million on pre-tax earnings of €239.6 million, an increase of 17 percent over the same period in 2008. Total revenues were up 20 percent to €582.2 million.

Chairman Lorenzo Pellicioli called the performance a demonstration of “the company’s resiliency during extremely difficult economic conditions.”

BUCHAREST HOTEL HOSTS NEW OLYMPIC CASINO

The Romanian subsidiary of Olympic Entertainment Group has opened its flagship casino Bora Bora in the capital city of Bucharest.

Located in Accor’s Pullmann Hotel, the two-story casino represents an investment of €6.4 million for Olympic and features 72 gambling machines, 17 traditional table games and three electronic roulette games across 1,400 square meters.

The venue also includes a restaurant and a VIP room.

Olympic entered the Romanian market in 2007 when it acquired three casinos in Bucharest from Empire International Game World. The company’s Romanian portfolio now numbers six properties.

Publicly traded Olympic, based in Estonia, is one of Europe’s largest operators, with gambling venues in Estonia, Latvia, Lithuania, Belarus, Ukraine, Romania and Poland and plans for expansion into Slovakia.