Czech Republic's Directorate of Finance has provided figures for last year's regulated gambling market's revenue. In total, the profits took a significant 21.3% nosedive to CZK31.3 billion ($1.4 billion).
The key factor that contributed to the decline is a much lower contribution from slot machines. In terms of handle, players have wagered CZK 249.4 billion in total (across all channels) which is 11.3% more than in 2017. They amount of total wins came down to CZK 218.2 billion.
Land-Based Business Particularly Bad
Slots were a major concern over the course of 2018...
...as this vertical showed the biggest signs of a struggle with a 39.3% drop in revenue (to CZK 14.8 billion), in large part owing to a problematic performance in the land-based slot sector which fell by a staggering 42.4 percent (CZK 12.9 billion). Online revenue was also down, but insignificantly in comparison – 4.8% (CZK 1.9 billion).
Slot revenue decline had a big impact from another standpoint: the GGR tax, for which operators pay 35%. As a result of a poor performance, the government's tax intake fell 20.3% on annual level.
In August 2017, gambling authorities in Czech Republic have introduced more strict controls and regulations on land-based venues' bonuses for players. This was followed by March 2018's tighter customer identification and registration procedures according to which all patrons are required to verify their age and identity.
Other Verticals Doing Better
Table games did much better than slots...
...as their revenue grew 8% year-on-year to CZK 2.3 billion, and in this case a strong land-based performance was the key. Online table games also did great compared to 2017 with CZK 175.1 million (against CZK 119.5 million) raked in.
Lottery performance was even better – it was up 13.8% to CZK 6.7 billion and it was driven by a strong retail performance – this channel contributed to 89.9 of the total revenue. Online lottery – legalized in January 2017 – grew by 78% to CZK 670.6 million.
Totalizer almost doubled its revenue to CZK 4.7 billion while bingo is the only other segment beside slots that took a blow – its revenue fell to CZK7.4 million.
The Market That is a Work in Progress
These figures are the second-ever set of yearly results published by the authorities since completely new gambling regulations were launched in January 2017. The brand-new framework was devised in order to attract international operators to come to the country and secure their licenses...
...however, certain prohibitions such as high taxes, long administrative processes and in-person registration requirements on gaming sites have worked in the opposite direction. Although, they're still not completely keeping big names from entering the market: in fact, in February, iGaming leviathan, Microgaming, announced their coming to the Czech Republic thanks to their deal with online casino and sports betting domain, TipSport.cz.
And things are about to get even tougher for interested operators:
The Czech government has agreed to increase tax rates on gambling from January 2020 to 30% for lotteries, non-slot and bingo and 25% tax for fixed-odds betting.
This is being done with the purpose of limiting the availability of products and services that may cause addiction.
Source:
“Slot decline hits Czech gambling market in 2018”, igamingbusiness.com, June 11, 2019.
VlagreDis
4 years ago
Too bad, but they may only need to adjust the regulations of their market. They're still young.
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