PointsBet has anticipated stricter federal government regulations around advertising by reducing its marketing while remaining confident it can continue to grow its revenue and market share.
PointsBet Group CEO Sam Swanell used a conference call to investors on Wednesday to outline a renewed advertising strategy focussed on what he says is minimising the risk of promoting wagering products to children and families.
“We believe (that) could be used to form the basis of a pragmatic and fair package of government-led advertising reforms that will meet community expectations,” Swanell said.
“Importantly, our results show that online wagering operators can continue to grow active and net win with this sustainable, safe and responsible advertising model.”
Among the strategies published in the presentation, PointsBet said it had stopped gambling ads on free to-air TV during children’s viewing times, ceased odds updates on free-to-air live sport and waived its rights for in-venue, signage and jersey sponsorship of the Manly and Cronulla NRL clubs from 2025.
It had also adopted a regulatory model which prohibits the advertising on gambling promotions to new customers. That model is based on the law in New South Wales but PointsBet has said it has extended that to its national customers.
The presentation also detailed that PointsBet had prioritised the reduction of its gambling advertising on free-to-air targeted at adults, reduced odds updates on racing broadcasts on free-to-air, and was prioritising promotions with customers on a one-to-one basis.
It was also looking at utilising age verification, sign-in and opt-out capabilities for both broadcast platforms and social and digital media.
Swanell said there was an expectation that advertising reform was coming via a federal government review and that it was important that the wagering industry led the way.
“We have proactively moved into a direction that we believe is the right direction to be moving in, but it's also the direction that has proven to be the right approach for us,” he said.
“We don't want to be advertising to an audience that is not interested in our products. We want to be more targeted with our advertising and promotions and we definitely have the capability to do that and media channels have the capability to do that.”
Federal Communications Minister Michelle Rowland is assessing the 31 recommendations from the You Win Some, You Lose More parliamentary report, with legislation expected to go before parliament before the end of the year.
Swanell said the initiatives which PointsBet have already taken were proof that a successful wagering business can operate without saturation advertising to the market.
“I think there has to be some outcome from the House of Representatives Standing Committee recommendations on advertising reform for the industry,” he said.
“So there's going to be some change and where we've presented our model, which we believe could represent a very appropriate model to be adopted and that it can be adopted without the industry foregoing growth and opportunity.”
Bren O’Brien
In its quarterly earning call, PointsBet reported a significant jump in its turnover and its net win margin compared to the same time last year as it continues to build its market share in both its Australian and Canadian operations.
The ASX-listed bookmaker released its unaudited Q4 and FY24 metrics and confirmed it has grown its sports betting turnover in the final quarter of 2024 to $668 million, 23 per cent higher than what it was at the same time last year.
Its gross win grew 13 per cent on the same period last financial year to $85 million, giving it a total gross win for the year of $338.2 million, or five per cent higher than FY23.
While PointsBet’s Canadian business continued to improve, the lion’s share of the growth has been driven by the Australian business where it has bucked broader industry trends by increasing its turnover from $2.83 billion to $2.93 billion over the financial year.
Bren O’Brien
Significantly, the positive results saw PointsBet upgrade its previous guidance on the company’s normalised EBITDA guidance.
“I am very pleased to note that Normalised EBITDA is now expected to be a loss of $1.8 million, which is a $2.2 million improvement on the upper end of our previous guidance and represents a $47.2 million improvement from the loss of $49 million in FY23,” Sam Swanell said.
“Our improved efficiency and productivity has also been a critical catalyst. We continue to invest for further growth, in particular in our core technology and product capabilities and through our strategic marketing investment.”
Although yet to be audited, the improved EBITDA numbers indicate that PointsBet is moving toward full-year profitability, a milestone for the company which has undergone major change after its exit and sale of its US operations, which were completed in May.
Swanell reported that sports betting continued to outperform racing, a trend which has become commonplace in the current Australian wagering environment.
He said while sports had driven double-digit win growth compared to the same time last year, racing’s comparative growth was in single digits.
“Overall sports versus racing, I think we've given sort of our indications there that sports from our perspective continues to outperform racing and that suits us because I think out of the major operators, we have the largest exposure to sports in the market,” he said.
