Allwyn has revealed its new leadership team in preparation for taking over the UK’s National Lottery licence from February 2024.
Starting on 1 October, the team features several notable additions, including Andria Vidler, who was confirmed as the permanent replacement for interim UK CEO Robert Chvátal in July.
Chvátal will return to focus full-time on his responsibilities as Group CEO of Allwyn.
Vidler boasts a wealth of experience, having previously served as the CEO of EMI in the UK and Ireland, as well as holding leadership roles at Centaur Media, Capital Radio, Bauer Media, and the BBC.
Additional recruits
In addition to Vidler, the leadership team welcomes other new recruits: Alan Artz, who joined Allwyn as CFO earlier this summer from William Hill; Chris Lyman, who will transition from his role as CEO of Lotto New Zealand to assume the role of COO at Allwyn in October; and Mark Smith, the current group CTO at ITV, who is set to join as CTO in November.
“This is a talented team with deep experience and a strong personal commitment to delivering the very best for communities across the UK through ever greater returns to Good Causes from The National Lottery,” Chvàtal said.
The Allwyn leadership team will also include the following members: Gaby Heppner-Logan as chief assurance and participant protection officer, Lucy Buckley as chief commercial officer, Martin Novak as interim chief data officer, Sam Sheriff as chief people officer, Alastair Ruxton as chief strategy and corporate affairs officer, Harry Willits as general counsel, Jenny Blogg as operations director, Eddie Bennett as operations transformation director, and Paul Lumb as technology transformation director.
Chvàtal expressed his gratitude to the Camelot leadership team “for their sterling work over many years supporting The National Lottery”.
“The National Lottery makes a huge contribution to communities across the UK through the money it generates for Good Causes. They have a great deal to be proud of. I wish them all the very best for the future,” he added.
Allwyn was awarded the fourth National Lottery licence in September 2022 and acquired incumbent operator Camelot in February 2023.
On completion of the deal, Camelot’s then CFO Clare Swindell and commercial director Neil Brocklehurst became co-chief execs and will lead Camelot until the end of January 2024.
Brocklehurst and Swindell will be actively facilitating the transition to Vidler before their eventual departure.
Lottery giant Allwyn recorded GGR of €1.96bn in Q2 2023, up 115.3% year-on-year, following its acquisition of Camelot UK and Camelot LS.
The company, formerly known as Sazka, completed its Camelot acquisitions – consisting of the UK’s National Lottery operator and the operator of the Illinois State Lottery – in February 2023, making Q2 the first full quarter to include their results.
Excluding the impact of the acquired businesses, Allwyn’s like-for-like GGR grew by 7.6% year-on-year to €979.8m.
Of the total €1.96bn in GGR, Camelot’s operations in the UK were responsible for around half at €980.3m, up 1.2% year-on-year.
As for Allwyn’s operating regions excluding the Camelot acquisitions, Greece and Cyprus generated €498.1m in GGR, up 12.6% year-on-year.
Austria generated a further €360.3m, up 1%, while the Czech Republic brought in €121.4m amid a year-on-year increase of 9%.
Outside the metric of GGR, Allwyn LS Group (formerly known as Camelot LS) which operates the Illinois State Lottery, generated a further €47.1m in total revenue, amid a 3.9% year-on-year reduction.
That revenue is generated from private management services and therefore is not included as GGR in Allwyn’s reporting.
Similarly, the company’s operations in Italy generated additional net revenue of €116.5m, up 3.4%. In that market, Allwyn holds a 32.5% stake in local lottery operator LottoItalia.
Overall, Allwyn declared adjusted EBITDA for the quarter of €381m, up 34.6% year-on-year.
“I am happy to report that the good performance in our existing geographies was driven primarily by strong growth in digital, where we have sustained our momentum in product development and innovation,” said Allwyn CEO Robert Chvatal.
“Alongside this, we continue to evolve and digitise the customer proposition in physical retail, while during the quarter we once again saw resilience of demand for our products, even in an environment where consumer spending remains under pressure.
“We continued to deliver strong margins and solid free cashflow generation, with only a limited impact of inflation on our cost base, reflecting our favourable cost structure, with our largest cost categories being directly linked to revenue, and our focus on cost and capital efficiency,” Chvatal concluded.
The UK’s next National Lottery operator Allwyn has been given the go-ahead to acquire incumbent operator Camelot and has made changes to Camelot’s leadership team, including the appointment of new co-CEOs.
Allwyn has received regulatory approval from the UK Gambling Commission to take over Camelot from its parent company, the Ontario Teachers’ Pension Plan, for an undisclosed price.
Previously, media outlets have estimated the transaction to be around £100m.
The agreement covers all of Camelot’s UK operations, which are currently run out of Watford, including the right to operate the National Lottery competition until February 2024.
Allwyn will assume control at that time. It was awarded the fourth National Lottery licence in September 2022 following a tender process, albeit after Camelot dropped its appeal against the decision.
New co-CEOs
On completion of the deal, Camelot’s current CFO Clare Swindell and commercial director Neil Brocklehurst (both pictured) will become co-chief execs and will lead Camelot until the end of January 2024.
Swindell joined Camelot in 2017 as CFO and was appointed to the board in September 2019.
Before joining Camelot, she was group CFO at marketing company dunnhumby and held several senior finance roles at Tesco, including as CFO for Tesco.com.
Brocklehurst has worked for Camelot in a variety of senior roles for 15 years and became commercial director in 2018.
His lottery experience includes working in the UK, Ireland and North America within Camelot Global, including as interim managing director.
Camelot’s current chairman Sir Hugh Robertson and CEO Nigel Railton will step down from the board.
Sir Keith Mills is expected to be appointed as the new chair at closing of the transaction, subject to regulatory approvals.
Mills, who is regarded as the mastermind behind London’s successful 2012 Olympics bid, also led Allwyn’s winning bid for the UK National Lottery licence.
Gambling Commission approval
Allwyn, meanwhile, welcomed the news that the Gambling Commission had cleared the company’s acquisition of Camelot UK, although the acquisition remains subject to certain regulatory conditions.
Allwyn said its ownership of Camelot would produce greater clarity and certainty for the future of the National Lottery, as well as for the good causes it funds and for the employees of both firms.
Last week, Allwyn CEO Robert Chvátal was made interim CEO of Allwyn UK upon the departure of David Craven, who had led the team that won the bid to replace Camelot as the UK National Lottery’s next operator.
Chvátal commented: “Acquiring Camelot will help ensure a smooth transition from the third to the fourth licence, while bringing together the collective expertise and technical know-how of two highly experienced lottery operators.
“We are thrilled to welcome Camelot into the Allwyn family. We are united by our common passion: to protect and improve the National Lottery, and the good causes it supports,” he added.
The news of the UKGC approval and leadership changes come after Allwyn also announced the purchase of the American-based Camelot Lottery Solutions division of companies from the Ontario Teachers’ Pension Plan Board in December.
Camelot success
Meanwhile, Camelot reported record-breaking revenue of £4.06bn for the first half of the 2022/23 financial year (April 1 to September 24, 2022).
The 2.6% increase over the same period in 2021 marked the first time sales exceeded £4bn during the first half of a financial year.
These sales helped the lottery operator increase its contributions to good causes by 8.1% to £956.5m, the largest amount ever donated during the first half of any financial year.
Allwyn performance
Elsewhere, Allwyn recorded a strong 11% increase in gross gaming revenue (GGR) to €958.6m for Q3 2022, which was the company’s best quarter to date.
The company’s adjusted EBITDA also rose by 10% to €319.9m, resulting in a margin of 54%.
Despite the impressive financial results, Allwyn did not proceed with its planned SPAC listing in the US with Cohn Robbins Holdings Corp due to concerns over a potential economic recession.
Topline numbers
The UK’s next National Lottery operator Allwyn has posted an 11% year-on-year increase in gross gaming revenue (GGR) to €958.6m for Q3 2022 – the firm’s best quarterly results to date.
Adjusted EBITDA for the period increased by 10% to €319.9m, resulting in an EBITDA margin of 54%.
News nugget
Allwyn primarily attributed the result to organic growth as driven by the online channel. For example, in the Czech Republic, online contributed 46% of total GGR, compared with 39% in Q3 2021.
Moreover, Allwyn’s Austrian business generated strong year-on-year growth, with GGR climbing from €309.1m in Q3 2021 to €349.1m in Q3 2022. GGR in Italy, meanwhile, decreased from €562m in Q3 2021 to €511.7m in Q3 2022.
The company also highlighted its operational resilience in the face of economic shocks.
While inflation and rising energy prices were affecting consumer sentiment in many markets, this has had a limited impact on demand for its products, Allwyn said.
Allwyn stressed it had noted similar revenue resilience during previous periods of weaker general consumer sentiment – for example the early period of the Covid-19 pandemic, the Greek crisis, and the global financial crisis – when demand for its products remained resilient, especially in comparison with other economic sectors.
In addition, Allwyn’s third quarter was shaped strategically by its successful bid to become the next operator of the UK’s National Lottery. The UK is set to become the sixth market that Allwyn operates in.
Earlier in November, Allwyn agreed to acquire current lottery operator Camelot and secured €1.6bn in funds having reached a senior facilities agreement with a syndicated group of international banks in November.
Allwyn has pledged to use the proceeds to refinance existing indebtedness but also to finance up-front costs in connection with becoming the UK National Lottery operator.
Allwyn said its strong operational performance and strategic progress in Q3 would provide a supportive background for the financing, which, according to CEO Robert Chvatal, positions the company “well for the next chapters” of its growth story.
Best quote
Allwyn CEO Robert Chvatal: “We note that general consumer sentiment has been impacted by inflationary pressures and the war in Ukraine. However, our business saw only a limited impact due to the low price point of our products and low average spend per customer, as well as our large number of regular players.”
Trading update and outlook
Allwyn said its business had continued to perform and develop well despite weaker consumer sentiment as winter approaches.
The operator stressed that its Q3 performance was broadly in line with its expectations for the year, whereby stronger performance in some products and geographies offset a somewhat weaker performance in others.
The UK’s newly appointed National Lottery operator Allwyn has agreed to buy the incumbent operator Camelot in a deal that will “help facilitate a smooth transition”.
Allwyn will acquire Camelot from its parent, the Ontario Teachers’ Pension Plan, for an undisclosed fee. Earlier media reports estimated the deal to be in the region of £100m.
The acquisition, which is still subject to regulatory approvals, is anticipated to close in Q1 2023.
It will put an end to a legal dispute that started in March when the Gambling Commission awarded Czech-based Allwyn the licence to operate the UK’s National Lottery from February 2024, ending Camelot’s 28-year tenure as the competition’s provider.
In April, Camelot appealed the decision, but dropped the challenge in September after the Gambling Commission warned the dispute may delay the handover and could have harmed fundraising for good causes.
Camelot will continue to operate as a separate entity, but, according to the Financial Times, most of Camelot’s 900 staff were already set to transfer to Allwyn as part of the handover of the lottery licence.
“We are delighted to have the opportunity to acquire the current operator of the third licence for the UK National Lottery,” Allwyn CEO Robert Chvátal stated.
“Common ownership of the operators of both the third and fourth licences will help ensure the successful delivery of the National Lottery, both in 2023 and over the next decade,” he said.
He continued: “Allwyn is committed to making the National Lottery better, raising more for good causes and improving player protection.
“This deal strengthens the transition process and helps support Allwyn in achieving its vision for the National Lottery.”
Allwyn said it is working collaboratively with both Camelot and the Gambling Commission on the transition plan.
Nick Jansa, executive managing director for Europe, Middle East and Africa at Ontario Teachers’ commented: “We are proud to have been a strong supporter and partner of the National Lottery over the past 12 years.
“In that time, under Camelot’s stewardship The National Lottery has raised more than £20bn for good causes and has supported thousands of organisations across the United Kingdom.
“We believe this sale best positions the National Lottery for a smooth transition to the Fourth Licence operator and wish Allwyn every success.”
Last week, Allwyn entered into a new €1.6bn senior facilities agreement with a syndicated group of international banks.
Allwyn had said it would use the proceeds primarily to refinance existing indebtedness but also to finance up-front costs in connection with becoming the UK National Lottery operator.
Camelot to defend its kingdom
The Telegraph appeared to have quite the scoop on Wednesday as it suggested UK National Lottery operator Camelot was set to retain its licence as it had secured the preliminary endorsement of the Gambling Commission.
Apparently Camelot had come up trumps on a scorecard designed to judge the merits of bids in the tender process, alongside competition from Italian lottery giant Sisal, pan-European Allwyn and the largest lottery operator in India, Sugal & Damani.
The Telegraph claimed the Gambling Commission had passed its scorecard to UK Government Culture Secretary Nadine Dorries, who took an admirable stand today by saying she would “probably” withdraw her support for Prime Minister Boris Johnson “if he went out and kicked a dog”, presumably relating to the fallout of West Ham defender Kurt Zouma volleying his poor pet cat last week.
Anyway, the Gambling Commission was quick to rebuke the Telegraph’s claims yesterday, stating that “we are still in the process of evaluation and today’s Daily Telegraph piece is simply based on false and inaccurate information” – that’s them told, then.
US firms prepare for Super-Duper Bowl this weekend
Operators stateside are preparing themselves for the biggest ever Super Bowl on Sunday as the Cincinnati Bengals face down the Los Angeles Rams (thanks, Google).
According to the American Gaming Association, a record 31.4m Americans plan to place a bet on the big fixture, with the best estimates claiming some $7.6bn will be wagered on the main event.
The Rams appear to be slight favourites, with 55% of bettors planning to back the team. More importantly, perhaps, 76% said it was important for them personally to bet through a legal operator – an increase of 11% compared to last year.
“The results are clear: Americans have never been more interested in legal sports wagering,” said Bill Miller, president and CEO of the AGA.
“The growth of legal options across the country not only protects fans and the integrity of games and bets, but also puts illegal operators on notice that their time is limited.”
Playtech in the press again
Rumours abound for Playtech, whose Latin American partner Caliplay is close to completing a SPAC acquisition on the New York Stock Exchange, according to The Times.
Speculators are apparently suggesting that if the business “gets off to a flying start” as a public entity, Playtech could end up converting revenues from its partnership with the operator into a 39% stake in the new business – worth as much as $700m.
Meanwhile, The Guardian went to press on Monday with a denouncement of Playtech’s newly signed five-year deal with the Jockey Club as horseracing increasingly looks to iGaming to top up diminishing revenues.
The result of the deal will be cross-sell opportunities, the piece said, or to put it less gently: “The Jockey Club flogging Playtech some racing-themed wrapping paper for software that mechanically grinds a fixed percentage of turnover from its users”.
The piece argues for stronger distinctions to be drawn between betting and gaming, decrying a blurring of the lines which has led to the cross-promotion of online casino and sports betting products to customers.
The “grubby and cynical” practice should be stopped, according to author Greg Wood, who strongly recommends the government consider “alcohol-style regulation for betting and a tobacco-style regime for gaming” in its ongoing Gambling Act review.