Quarterly Activities Report
Q3 FY20 was a significant quarter for the Company as its wholly owned subsidiary, BetMakers DNA Pty Ltd, signed a first-of-its-kind agreement to offer Fixed Odds betting on horse racing in New Jersey (as announced to the market on 5th February 2020), as well as continuing on its expansion of B2B wagering products through a landmark partnership with the Waterhouse Group1 (as announced to the market on 28th January 2020).
The Board believes that these two transactions have positioned the Company very well for future growth, building on the strong base established by the existing domestic B2B wagering business.
The Waterhouse Group partnership has already resulted in further progress for BetMakers, with the Company signing agreements with two of Australia's premier on course rails bookmakers (as announced to the market on 27 April 2020).
In light of the future growth expected across the business, in January 2020 the Company decided to make an additional investment into its technology and team, including with respect to the New Jersey and Waterhouse Group opportunities. During the quarter the Company made strategic staff hires and invested in excess of $150,000 directly on the development of the US opportunity (primarily comprised of staff, travel and professional fees), as well as $294,000 on the development of its software technology (primarily comprised of staff).
Further COVID-19 update
As announced on 26th March 2020, to date, there has been no impact on BetMakers as a B2B racing wagering technology business, most importantly noting there has been no loss of customers or contracts. Delivery of existing products and services are currently operating as normal.
With respect to the expected launch of the Fixed Odds business in New Jersey, Monmouth Park recently announced the start of its racing season had been rescheduled because of the COVID-19 restrictions that are currently in place in New Jersey. The season, originally scheduled to launch on 2nd May 2020, is now expected to commence on 4th July 2020.
Under the terms of its exclusive 10-year agreement, BetMakers had intended the launch of Fixed Odds betting in New Jersey to coincide with Monmouth Park's season launch. The Company is working with Monmouth Park on a plan to begin Fixed Odds betting on International and Interstate horse racing prior to Monmouth Park's season starting. The Company remains pleased with the progress made with Monmouth Park and continues to expect that the Fixed Odds wagering business in New Jersey will contribute materially to revenues following launch.
Previously expected revenue from Fixed Odds wagering on Monmouth Park racing in Q4 FY20 will be delayed, which is expected to have an impact on the previous FY20 revenue guidance of $10mil. The Company had previously expected the launch of US operations to deliver approximately $1.0million of revenue during Q4 FY2020.
The Company reiterates previous guidance that it expects to return a positive EBITDA for FY20.
The Company paid Directors $100,000 for services during the quarter ending 31 March 2020. This includes payment to the CEO for employment services as CEO.
During the quarter the Company paid $100,000 in interest in relation to the deferred acquisition payments for DynamicOdds and Global Betting Services ($4.0million deferred, attracting 10% interest per annum, cash paid).
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About Betmakers Technology Group Ltd
Betmakers Technology Group Ltd (ASX:BET) (FRA:T07) is an ASX-listed holding company and a global provider of online wagering products and services to both wholesale and retail markets through its various wholly owned subsidiaries. The Company operates a retail wagering business, offering consumers wagering, fantasy tournament and content products and services.
Betmakers Technology Group Ltd