The pandemic will test bookmakers
Number two on the Polish bookmaking market reduces the fixed-line network, but ensures that this year's results are not bad. It can be more difficult for smaller companies.
Bookmakers were betting that 2020 would be great for them and they miscalculated because they could not take into account the outbreak of the pandemic. Instead of increasing interest in cross-betting, Euro soccer was followed by a lockdown and the suspension or cancellation of most sports and competitions. However, after the athletes returned to the competition in the summer, interest in the bookmakers' offer has revived.
The last three months have been very good for bookmakers. Of course, this year will not be as good for the industry as it was expected before the pandemic, because the football Euro was not held and we had to deal with a more than two-month break in sports. After optimizing costs and renegotiating contracts, including sponsorships, we should end the financial year for online operations with a slight adjustment to the result assumed for 2020. Since the end of the first wave of C0VID-19, a significant increase in the number of customers in the online channel legally betting on results can be observed Konrad Komarczuk, president of Fortuna in Poland.
Last year, Fortuna had revenues of PLN 2.1 billion, down 21.5 percent. more than a year earlier. At the same time, it recorded PLN 74.5 million of pure profit, which means an increase by 29%.
We assumed that this year's revenues would increase by approximately 25%. Lockdown has verified this. In the first months of the pandemic, when most sports competitions were suspended, players were betting on the results of football leagues in Belarus or Nicaragua, table tennis competitions in Ukraine and e-sports games. However, since August, when the football leagues and tennis tournaments returned, the dynamics of results has been higher than our expectations, and in October we achieved our monthly budget assumptions in three weeks. The only question is whether this will continue at the end of the year, will we face another lockdown and will we be forced to close our ground facilities again - he says Konrad Komarczuk.
On the Polish bookmaking market, 19 companies have a formal license to operate from the Ministry of Finance. In practice, more than 40 percent. the betting market (excluding low-margin card game bets) is owned by STS, and over 30 percent. to Fortune.
However, smaller companies have problems. This was most clearly seen in the case of Millennium, the market veteran who suspended in-store betting in March, and online betting a few weeks later.
The pandemic may clear the Polish market. In my opinion, there is room for up to five major operators. In this industry, in order to have any profit, you need to generate approximately PLN 600 million in revenues per year, and achieving this level from scratch requires 2-3 years and expenditure on acquiring customers of PLN 50 million per year. Those who cannot afford it will have to disappear - he believes Konrad Komarczuk.
Fortuna generates most of its revenues from online betting, but it also has a large network of stationary branches. Currently, it has 330 own branches and almost 200 agencies.
Even before the start of the pandemic, we planned to reduce the network, mainly in smaller centers with less than 20-30 thousand. residents. We have closed about 60 outlets this year, and we will want to close 70-80 more, apart from smaller centers, also at stations or in shopping malls, where customer traffic has dropped significantly and rents remain high - he says Konrad Komarczuk.
The head of Fortuna does not hide that the pandemic changes the company's view of running stationary facilities.