With the release of preliminary earnings results for 2016, Paddy Power / Betfair confirmed that the company’s New Jersey-facing online casino is nearing profitability.
Moving into the black would mark a first for the Betfair Casino New Jersey operation, which launched in November of 2013 as one of the state’s six original online casino venues.
Within the dense 53-page financial disclosure, Paddy Power / Betfair attributed a strong performance by the company’s US division largely to Betfair Casino New Jersey, which recorded revenue growth of 39 percent last year.
Breon Corcoran, who serves as chief executive officer of Paddy Power / Betfair, broke the US division numbers down while speaking to investors during an earnings presentation:
“US division revenue in local currency increased by 13 percent and operating profit increased by 9 percent.
These results include … Betfair Casino New Jersey, where revenue increased by 39 percent. The casino is now operating at breakeven earnings before interest, tax, depreciation and amortization (EBITDA) after a couple of years of startup losses.”
Overall, Paddy Power / Betfair’s global operations tallied revenue of £1.55 billion ($1.9 billion), good for an 18 percent rate of growth, along with a 35 percent rise in EBITDA.
The company’s New Jersey operation is linked to the brick and mortar Golden Nugget casino resort in Atlantic City. The venue serves as the license holder for Betfair Casino New Jersey, along with its own Golden Nugget branded online casino, and a third platform known as PlaySugarHouse Casino.
Based on previous disclosures by Paddy Power / Betfair, the Betfair Casino New Jersey platform accounts for approximately 35 percent of the Golden Nugget’s total iGaming revenue.
Combing through the monthly revenue reports released by the New Jersey Division of Gaming Enforcement (NJDGE), the steady pace of growth enjoyed by Golden Nugget’s collection of licensees is quite clear.
After beginning 2016 with just over $2.5 million in monthly revenue over January, the group increased that figure to just under $4.8 million by December – good for an increase of 92 percent over the 12-month span.
The table below shows all monthly revenue totals reported by Golden Nugget’s licensees throughout 2016:
Making the site’s performance even more impressive, Betfair Casino New Jersey, and the other Gold Nugget licensees for that matter, lack the online poker component that competitors like Borgata and Caesars rely on.
Historically, the state’s fledgling iGaming marketplace has been dominated by the alliance between Borgata – Atlantic City’s major casino resort – and PartyPoker. In May of last year, the partnership held 24 percent market share to lead New Jersey’s five operating groups, while Golden Nugget and Betfair sat in fourth place with 19 percent.
But by January of this year the tide had turned significantly, with Golden Nugget holding 22 percent market share – 12 percent of which came from Betfair Casino New Jersey – to outpace Borgata / PartyPoker at 21 percent.
That month saw Golden Nugget and Betfair dominate the monthly revenue counts with a $4,776,218 total gaming win. Even combining casino and poker play, rivals like Caesars / 888 ($4,032,263) and Borgata / PartyPoker ($3,767,853) were badly outperformed.