New lottery operator says cost-of-living crisis has had ‘limited’ impact

The gambling giant expected to take over the National Lottery has said the cost of living crisis has had a “limited” impact on demand for its games.

Allwyn, which runs lotteries in Austria, Italy and Greece, on Monday reported 902m euros in Gross Gaming Revenue (GGR) for the second quarter of 2022, up 23% from the same time last year.

The company, expected to be be the next operator of the Nation Lottery from 2024, said recent economic events will continue to have “some impact” on its business but appeared optimistic about the extent its operations will be affected.

Addressing the war in Ukraine, rising energy prices and inflation in an update on its trading it said: “The impact on demand for our products has been limited, reflecting their low price point and low average spend per customer, as well as our large number of regular players.

“Current trends are in line with the resilience of our revenues during previous periods of weaker general consumer sentiment, for example the early period of the Covid-19 epidemic, the Greek crisis and the global financial crisis when demand for our products remained resilient, especially in comparison with other consumer sectors.

“Similar to other periods when general consumer sentiment has been subject to shocks, our revenues were impacted to a limited extent in the immediate aftermath of the Russian invasion of Ukraine and the rapid increase in energy prices.

“However, once the period of the initial shock had passed and consumers’ behaviour had normalised, sales of most of our products in most of our geographies demonstrated a strong recovery.”

The Gambling Commission, Britain’s gambling regulator, announced in March that it had chosen Allwyn for the next National Lottery licence, ditching Camelot after 30 years.

In June Camelot lost a legal bid to prevent the handover, with the high court agreeing to lift a suspension preventing the commission from beginning the licence transfer.

The suspension was put in place when Camelot launched action in April challenging the decision to pick Allwyn.

Camelot is hoping for a trial in October, but the commission is pushing for it to begin in January.

Camelot is expected to sue the regulator for an estimated £500 million damages.

In the performance update, Robert Chvatal, Allwyn chief executive, said the company “look forward” to a hearing of the case in September.

He said: “Following the March announcement that we have been selected as the Preferred Applicant for the fourth UK National Lottery licence by the UK Gambling Commission, we continue with our preparations to take over as operator of the UK National Lottery once the Gambling Commission confirms the award of the fourth licence.

“We look forward to the Court of Appeal hearing in September of the current operator’s appeal of the High Court’s decision to allow the license award to proceed and the formal transition period to begin.”