SVL ramping up online games

SUPREME VENTURES Limited, SVL, has locked down its Acropolis gaming lounge since March 18, when the Government mandated the closure of all lounges and bars.

Sports wagering has fallen precipitously, concomitant with the suspension of sporting events worldwide; while the lockdown imposed on entertainment spots locally has idled SVL’s video lottery terminals.

“What still remains good for us is our core business, that is to say, the games products and the recharge services that we offer,” says Xesus Johnston, CEO of Prime Sports, an SVL subsidiary.

Fewer persons are placing wagers, but SVL has noted a recent change in spending patterns.

“The average value per transaction has started to move up slightly. We believe that comes back to people buying a little more telephone credit and persons doing advance wagering,” he said.

“Transactions are down in the single digits, but what we’ve seen is that certain types of transactions are increasing, such as telephone recharge … ,” Johnston said.

For the first quarter ending March, SVL’s earnings showed no apparent sign of the effect of the coronavirus pandemic that has been traversing the world since January, but only hit Jamaica in early March.

Gaming revenue grew nine per cent in the quarter, while profit for the period rose nearly 19 per cent year-on-year to $736.79 million.

The numbers held up in the quarter due to the momentum coming out of the first two months, according to Johnston, but the pandemic has knocked the company’s projections off course and forced a recalibration of its expansion programme.

Pay cuts

In addition, Executive Chairman Gary Peart told staff last Friday that he and the C-suite team have taken pay cuts of up to 30 per cent for May 2020, the Financial Gleaner has learnt.

“If you ask whether the impact has been as great as we thought it would be, then the answer is no; but it has an impact in terms of where we expected to be and the trajectory coming out of the first couple months of the year,” Johnston said.

Of the $10.13 billion of revenue recorded by the company in the March quarter, 79 per cent came from lottery games and PIN codes; sports betting accounted for four per cent; horse racing, 15 per cent; and VLT routes and lounges, one per cent.

Horse racing was the only revenue segment to underperform the comparative March 2019 period. But the company is currently experiencing fallout in other areas as well.

“Supreme Ventures has eight lines of business and currently two of them are operational, in that the numbers business, though impacted, is doing well, and the phone credit is operating at normal or higher levels. Sports betting is functional, but significantly underperforming,” Johnston said.

The company is now strategising on delivering more products online. That, Johnston suggests, comes from the realisation that e-commerce and online transactions may become a permanent legacy of social distancing, even beyond the pandemic.

Before the virus, e-commerce in Jamaica had a low penetration of about six per cent, and few companies used the Internet as a main conduit to deliver services, but those numbers are now growing as businesses put physical space between themselves and their customers in the interest of safety.

The shift offers what the gaming executive calls a ‘profound opportunity’ to develop new business lines.

“Coming out of COVID-19, the new normal will see people operate quite differently from what obtained in the past. The new normal will mean that we have to incorporate some sort of social distancing. There is definitely an opportunity for us to do more online,” he said.

SVL has teams working on enhancements to the online offerings, such as the SV Games app for Money Time and Cash Pot. The Justbet app for sports betting was upgraded last December.

Johnston says the SV Games improvements will offer easier payment options, including PayPal, credit and debit cards. The fast-tracked changes should be available “possibly before June, pending regulatory approval” from the Betting, Gaming & Lotteries Commission, he said.

For now, most of SVL’s games are sold at agent windows nationwide, and the company wants to safeguard the network and the people who work within it. In that regard, SVL has inked a deal with top insurance provider Sagicor Life for group health coverage for vendors, at a discount.

neville.graham@gleanerjm.com