Lotteries globally open 2019 with a steady first quarter
During the first quarter of 2019, global lottery sales rose 4% in aggregate over the equivalent period in 2018, with growth in Africa and Latin America pushing ahead of Asia Pacific for the first time in a year.
First-quarter 2019 sales in Africa were up 20.5% on Q1 2018 in aggregate, while sales in Latin America grew 7.1% over the same timeframes. Asia Pacific, which had led the field for the last three quarters, saw its growth in sales moderate, with first-quarter on first-quarter sales increasing by ‘only’ 4.9%. In the other big regional markets of Europe and North America, quarter-on-quarter sales were up by a more temperate 3.3% and 2.8% respectively.
This is the second year in a row that Africa and Latin America have enjoyed an outstanding start to the year. In 2018, they enjoyed first quarter-on-quarter growth rates of 17.7% and 13.9% respectively.
Africa: South Africa and Mauritius power Africa’s sales
In 2018, it was Morocco’s two lotteries that pushed Africa to new heights as the year began, but at the beginning of 2019, it was South Africa’s Ithuba and the Mauritian National Lottery doing the heavy lifting, pushing the growth in sales of contributing lotteries in Africa to 20.5% quarter-on-quarter.
Mauritian National Lottery operator Lottotech saw turnover from the sale of its flagship Lotto 6/40 game increase by a hefty 58.6% for Q1 2019 versus Q1 2018, a positive variance of MUR 231.6 million (USD 6.4 million). The increase in sales was primarily due to the introduction of a second weekly Lotto 6/40 draw on Wednesdays, which drove higher aggregate jackpot offerings and an increase in rollovers.
South Africa’s Ithuba was also delighted with its Q1-on-Q1 increase in sales of 34.4%. The company is continuing to reinvigorate the South African National Lottery and has grown sales to new heights every year since taking over operations in June 2015.
The first quarter of 2019 saw the operator of South Africa’s national lottery enjoying several record-breaking weeks of sales, thanks to an imposing Powerball jackpot of ZAR 232 million (USD 15.7 million). The jackpot, which was the biggest in the history of the South African National Lottery, was won by a single ticket holder and claimed in February 2019.
Ithuba also launched a new Daily Lotto game in March, which further boosted sales in Q1 2019. The Daily Lotto has a jackpot that rolls down into other prize divisions if it is not won on a daily basis, a feature of the game that has made it highly popular. Within weeks of its launch, Daily Lotto became the third most popular game in the company’s product portfolio behind Lotto and Powerball.
Not content to rest on its laurels, Ithuba also launched a new mobile app and a number of new online EAZiWIN games in Q1 2019, in addition to its smash hit Daily Lotto game.
Although Morocco’s La Marocaine des Jeux could not keep up with its Mauritian and South African counterparts, it could still be happy with a healthy 9.9% increase in sales over the course of Q1 2019, versus the corresponding revenue period of 2018. In contrast, its counterpart Loterie Nationale Morocco saw sales contract sharply over the same timeframes.
Latin America: Chile’s Polla Chilena the fastest growing lottery in Q1 2019
Lotteries in Latin America saw first-quarter on first-quarter sales rise by 7.1% in aggregate, thanks in no small part to the astonishing performance of Chile’s Polla Chilena de Beneficencia. Among lotteries featured in the WLA Quarterly Lottery Sales Indicator (QLSI), the Chilean lottery was the fastest-growing enterprise over the three opening months of 2019, thanks to the 122.7% rise in sales it witnessed over the January–March period, as against the January–March period of the previous year. The Chilean operator was able to thank a number of historic jackpots for its outstanding increase in sales.
In comparison to the dominant performance of Polla Chilena, growth across Latin America in Q1 2019 was otherwise much more tempered. Mexico’s Pronósticos was nevertheless more than happy with its performance, which saw its sales rise to MXN 2.46 billion (USD 128.7 million) during Q1 2019. This represented a rise of 12.4% on the same period in 2018.
Several factors contributed to the Mexican lottery’s increase in sales, both intrinsic and extrinsic; among the external factors positively affecting sales was increasing confidence in the new Federal Government’s anti-corruption measures and its endorsement of the principles of honesty, integrity, and accountability. The Melate family of games (comprising Melate, Rematch, and Revanchita), which represent 32% of overall sales at Pronósticos, grew Q1-on-Q1 sales by 20% on average, on the back of the accumulated jackpot of the three products in the family. The accumulated jackpot, which was MXN 480 million in early January 2019, reached MXN 600 million (USD 31.4 million) before being won later in the quarter.
Other products that grew in the January–March period were Tris, and instant scratch-off games, which returned to the market. Also, the Chispazo game sold MXN 12.8 million more in Q1 2019 than over the same period of 2018. Overall, 12 of the 14 products offered by the lottery saw increases in sales between 2.2% (Progol) and 38.2% (Melate Retro). Only two products saw a decrease in sales: Gana Gato (-3.6%) and Protouch (-1.2%).
Elsewhere, Mexico’s Lotería National para la Asistencia Pública enjoyed a steady 3.5% rise in sales over the January–March 2019 period, as against the period January–March 2018, while sales at Brazil’s Caixa Econômica Federal crept up 0.2% quarter-on-quarter.
Asia Pacific: LotteryWest leads Asia Pacific operators
For once it was not China leading the way in the Asia Pacific region but rather Australia’s Lotterywest, which saw Q1 sales rise 24.8% on the equivalent period in 2018. Overall, sales among contributing lotteries in Asia Pacific increased 4.9% in aggregate for the first-quarter of 2019, as against the first quarter of the previous year.
The West Australian lottery’s improved sales results were driven by changes made to the Powerball game across all Australian jurisdictions in May 2018. These changes included: an amended game matrix, which now requires 7 winning numbers from 35 balls (rather than 6 winning numbers from 40 balls) along with the Powerball (which is still drawn from a barrel of 20 balls); a more rapid rise in jackpot event size when there is no winner; new prize divisions with improved odds of winning; and a substantial rise in the product price point.
Comparing results from the first quarter of calendar year 2018 (pre-Powerball changes) with the first quarter of calendar year 2019 (post-Powerball changes), cumulative Powerball events at Lotterywest were up 82.1% (from AUD 212 million to AUD 386 million), meaning Powerball sales more than doubled with a Q1-on-Q1 increase in sales of 104.2%.
Quarterly growth of 104.2% is the kind of increase that has more traditionally been associated with the mainland Chinese lotteries. However, the mainland Chinese lotteries experienced a comparatively muted start to 2019, with Q1-on-Q1 sales rising 2.1% in aggregate. The China Welfare Lottery saw quarter-on-quarter sales down by 6.1%, to CNY 49.1 billion (USD 6.9 billion), even as the China Sports Lottery saw its sales increase 10.3% over the same period to CNY 57.3 billion (USD 8.1 billion).
Over the Q1-on-Q1 period, sports betting was once again the fastest growing segment with sales up 43% in aggregate across China’s mainland lotteries; in contrast, sales of numbers games fell by 14.1% over the same timeframes. Over the January–March quarter, sales of numbers games composed 51.7% of all sales, while sales of sports betting products composed 30.5% of all sales. Sales of all other products (instants, VLTs, and Keno) constituted the residue of the market.
Elsewhere in Asia Pacific, sales at the Hong Kong Jockey Club were up 9.4% over the first quarter of 2019, as against the first quarter of 2018, while sales at Japan’s Mizuho Bank were up 8.8% over the same revenue periods. At Mizuho Bank, the frequency of the Lotto 7 rollover helped increase sales; Lotto 7 is a traditional draw-based (number selection) game. In 2018, the Green Jumbo product was rebranded as the Valentine Jumbo; this is a draw-based game where the numbers are pre-selected by computer rather than by the player. During the first year of the product’s relaunch, the Valentine Jumbo was not well known to customers, but it has since significantly increased its visibility, thereby boosting sales. In addition, Mizuho bank has started to sell several further varieties of instant lottery tickets, and instant game sales have also increased.
Europe: Hungary stands out in solid quarter for Europe
Europe’s lotteries enjoyed a steady increase in sales of 3.3% across the 12 lotteries from Europe supplying figures for the WLA QLSI.
Hungary’s Szerencsejáték Zrt. continued its strong run of form into 2019, recording an impressive 19.7% increase in sales over the first quarter of the year, as compared to the first quarter of 2018. Several significant jackpots boosted the results for numbers games directly, and also had a positive effect indirectly on the sale of instant tickets. In addition, there was a significant increase in sports betting play in Hungary, which had the effect of boosting the Hungarian lottery’s sports betting numbers.
Of Europe’s other contributing lotteries, France’s La Française des Jeux (FDJ) was the most successful in Q1 2019, featuring a growth rates of 8.1% in Q1 2019, as against Q1 2018.
For its part, Greece's OPAP could be happy with a 5.0% year-on-year growth in revenue to EUR 396 million, delivering OPAP’s strongest Q1 performance for a decade, on the back of its enhanced product offering. Further, net profit was up 43.5% to EUR 57.2 million, a handsome payoff for the increased attention OPAP has paid to operational efficiency in recent years.
Outside of Scandinavia, most of Europe’s other contributing lotteries reported Q1 2019 results hovering around the average for the region as a whole. Italy’s Lottomatica recorded quarter-on-quarter growth of just over 2%, flagging the possibility that the country’s ban on gambling advertising introduced in June 2018 is beginning to take effect. For its part, Spain’s Sociedad Estatal Loterías y Apuestas del Estado reported growth of 3.8%, slightly ahead of Switzerland’s Loterie Romande, which enjoyed quarter-on-quarter growth of a little less than 3%. Norway’s Norsk Tipping was the best performing of the Scandinavian lotteries, which had a tougher quarter. Sales at the Norwegian national lottery broke exactly even for Q1 2019, when compared to the lottery’s corresponding tally for Q1 2018.
North America: U.S. and Canadian lotteries experience a mixed quarter
Participating North American lotteries had their ups and downs in a fluctuating first three months of the year that saw quarter-on-quarter sales increasing by 2.8% in aggregate. All seven contributing U.S. lotteries saw their sales increase between 1.7% and 10% over Q1 2019 versus Q1 2018, but these positive results were offset by the contributing Canadian lotteries, which all saw sales decline for the first quarter of 2018, as against the first quarter of the previous year.
The fastest growing operators in North America hailed from the Southern states of Kentucky and Texas, with Connecticut not far behind. The Kentucky Lottery Corporation boosted Q1 sales by a healthy 10% over the same period of 2018, while the Texas Lottery Commission witnessed a 6.9% increase in sales over the same comparative calendar quarters.
Meanwhile, sales revenues at the Connecticut Lottery Corporation totaled USD 333.6 million for the opening quarter of 2019, compared to USD 317.1 million for the year prior. Overall, total sales increased USD 16.6 million or 5.2%. Instant ticket portfolio revenue was up USD 5.3 million or 3.0% while Keno revenue was up USD 4.5 million or 20.2%. The most surprising contributor to the Connecticut Lottery’s successful first quarter of 2019 was its Lotto game (6 from 44 matrix). The game, which had rolled for 129 draws, saw revenues rise by USD 5.7 million or 135% year over year. Commenting on the results, Greg Smith, President and CEO of the Connecticut Lottery said, “The CT Lottery is pleased to continue to be a consistent and significant financial contributor to the state.” He continued, “In order to maintain and build upon these results in the coming years, we hope to soon become authorized for additional revenue streams, such as sports betting and internet lottery games.”
Elsewhere in the U.S., steady numbers were recorded by the country’s other big operators, with the California Lottery, the Florida Lottery, and the New York State Lottery all growing by around 3% quarter-on-quarter.
The WLA extends a warm welcome to the Texas Lottery Commission, the newest member of the WLA Quarterly Lottery Sales Indicator family. Going forward, the WLA will continue to track the progress of global lottery sales in future editions of the WLA QLSI. Once again we thank all WLA member lotteries participating in this initiative, and look forward to bringing you the second quarter 2019 results shortly.
WLA Executive Director
|* Based on sales of participating lotteries. Participating lotteries by region:|
|Ghana: National Lottery Authority||Brazil: Caixa Econômica Federal|
|Mauritius: Mauritius National Lottery||Chile: Polla Chilena de Beneficencia|
|Morocco: La Marocaine des Jeux et des Sports||Mexico: Lotería National para la Asistencia Pública|
|Morocco: Loterie Nationale||Mexico: Pronósticos|
|South Africa: Ithuba Holdings (RF) (Proprietary) Limited||North America|
|Asia Pacific||Canada: BCLC|
|Australia: LotteryWest||Canada: Loto-Québec|
|China: China Sports Lottery||Canada: Ontario Lottery|
|China: Chinese Welfare Lottery||USA: California Lottery|
|Hong Kong: HKJC||USA: Connecticut Lottery Corporation|
|Japan: Mizuho Bank Ltd.||USA: Florida Lottery|
|Europe||USA: Kentucky Lottery Corporation|
|Finland: Veikkaus Oy||USA: New York State Lottery|
|France: Française des Jeux||USA: Tennessee Education Lottery Corporation|
|Greece: OPAP||USA: Texas Lottery Commission|
|Hungary: Szerencsejáték Zrt.|
|Italy: Lottomatica S.p.A|
|Norway: Norsk Tipping AS|
|Poland: Totalizator Sportowy Sp. z o.o.|
|Spain: Sociedad Estatal Loterías y Apuestas del Estado|
|Spain: Organización Nacional de Ciegos Españoles|
|Sweden: AB Svenska Spel|
|Switzerland: Societe de la Loterie de la Suisse Romande|
|United Kingdom: Camelot UK Lotteries Limited|