Science Games collaborates with Lotto.
Scientific Games, a popular games and software manufacturer based in the US, has extended its deals with German state lotteries Lotto Thuringen and Lotto Bayern. These agreements involve implementing digital instant win games. Will these agreements help Scientific Games bounce back from the financial slump caused by the coronavirus pandemic?
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Scientific Games, a prominent online casino game developer, has extended its regional lottery partnerships with Thuringia, one of the German states. The three-year contract has an additional one-year extension option. Scientific Games had already collaborated with Lotto Thuringen for more than two decades and serves all 16 state lotteries in Germany.
Thuringia is one of the few lottery markets in Germany that keeps growing regardless of the pandemic. The expansion of instant win games for the state is underway. According to Jochen Staschewski, CEO of Lotto Thuringen, the growth rates are mainly due to existing instant win products. To cater to the growing demand, the company is keen on expanding its retail range and offering more digital instant games. These can be played conveniently at home and via mobile phones. This sentiment was echoed by John Schulzt, Senior Vice President for Instant Win Products at Scientific Games, who shared with SBC:
"We've been providing Lotto Thuringen with value-added instant win products for over two decades. These games have demonstrated an ability to increase revenue for our lottery clients worldwide. The potential of games sold both at retail and online hasn't been entirely tapped in Europe yet, but they continue to be the largest and most successful lottery product category in the US and are still growing."
More Than a Decade Long Partnership with Lotto Bayern
Scientific Games recently signed a four-year extension to its 25-year technology contract with Lotto Bayern, the second-largest German state lottery. This deal includes an option for a five-year extension. As part of the terms, the US company will modernize Lotto Bayern's central gaming system with its latest technology - Symphony.
Symphony is the most recent digital lottery and gaming platform of Scientific Games. The Munich-based lottery will be among the first in the world to adopt this "self-contained system", benefiting its 3,500 retail outlets, as well as online and mobile sales. Matthias Müller, Sales Director at Scientific Games, stated in a press release:
"It is vital for Scientific Games to deliver advanced, cloud-enabled, and reliable systems such as Symphony to our lottery clients. Symphony facilitates the quick launch of new products and services as well as integrates innovative solutions to introduce new games. This technology will provide Lotto Bayern players with the latest and most advanced features."
Salary Cuts to Save Jobs
Scientific Games' CEO Barry Cottle and other company leaders recently announced they would be cutting their salaries by 50% to preserve jobs. The move comes as many US casino employees, especially those in "support functions", face redundancies due to the ongoing pandemic.
Financial Decline
Recently, Scientific Games experienced a significant drop in revenue, with a 13% decrease to $725 million. The company's business has been affected by lower revenue and higher impairment costs. Gaming services generated $422 million in revenue for the first quarter, a 8.1% decline compared to Q1 of the previous year.
Product sales dropped by 29.5% to $168 million, while instant win games raked in $135 million, representing a 3.6% decline. Of the total revenue, Scientific Games made $318 million through its land-based division SG Gaming, but this marks a 25% decrease compared to the previous year.
Revenue from Gaming Operations
Revenue from gaming operations fell to $119 million, down by 22.7% year-over-year. The gaming machine business resulted in a loss of 32.4% at $97 million, compared to the prior year. The sales of gaming systems dropped by 25.7% to $55 million. This wasn't the case for table games, however, which saw a decline of only 13.3% to $52 million.
All in all, the company delivered 4,893 new gaming machines in the first quarter and managed to operate 64,841 by the end of the quarter. Despite the impact of the health crisis on the quarter, the company took significant cost-cutting measures and expects an improvement of more than $150 million in the second quarter.
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Source: www.onlinecasinosdeutschland.com
