Canadian betting and media business theScore saw revenue fall 7.6% year-on-year in its first quarter, with a record performance from its media division offset by sportsbook losses.
Revenue fell to CAD$8.5m ($7.3m) for the three months to 30 November, 2020. This came despite its media division reporting record revenue of CAD$10.6m, up 15.2% from the prior year.
theScore Bet – which expanded into Colorado and Indiana during Q1 – posted a loss of CAD$2.0m for the quarter, however, on CAD$55.8m of stakes, a significant year-on-year jump. After player winnings, the operator generated gross gaming revenue of CAD$300,000, though net revenue swung to a loss after promotional costs and fair value adjustments on unsettled bets were factored in.
“We continue to deepen our market-leading media and betting integrations and achieved year-over-year handle growth of 535% on theScore Bet,” theScore founder and chief executive John Levy said.
“While still in the early stages of this fast-growing industry, we are steadily strengthening our expanding footprint in the North American sports betting market,” he said. “Now, following successful recent launches in Colorado and Indiana, we’re on track to launch in Iowa in the coming weeks, subject to regulatory approval.”
Costs rose for the quarter. Total operating expenses were up 25.5% to CAD$19.2m, with the business investing in its gaming expansion plans.
Technology and operations expenses accounted for CAD$5.3m of this total, up 65.6%, while general and administrative costs climbed 71.4% to CAD$4.8m.
Operating loss therefore widened to CAD$10.7m. After CAD$2.0m in finance-related expenses, loss before tax came to CAD$12.7m.
Foreign currency translation charges came to $319,000, resulting in theScore’s comprehensive loss expanding to CAD$12.4m.
Looking ahead, Levy highlighted potential growth opportunities in its native Canada. In November, the Canadian Government said it would support a bill to decriminalize single event wagering, picking up the bill introduced earlier in the month by Kevin Waugh MP.
theScore and the British Columbia Lottery Corporation (BCLC) have been strong supporters of the plans to permit single sports event betting.
“theScore is Canada’s most popular mobile sports brand with millions of loyal media app users across the country and we are eager to deploy our cutting-edge technology and launch our best-in-class sportsbook experience to fans in our home territory,” Levy explained.
The business is also exploring a potential listing on a US exchange, scheduling a shareholder meeting next month.
theScore said a US listing would give it access to a significantly larger pool of capital, opening the business to US retail and institutional investors, and increasing its average daily trading volume. This could ultimately increase its market valuation, it noted.
“theScore is uniquely positioned, both in the US and Canada, as the only truly integrated mobile media and gaming company,” Levy said. “Based on the continued development of theScore and the growth of the sports betting industry across North America, in our view it is timely to consider a listing on a US stock exchange.
“We believe that access to the US capital markets would provide compelling benefits for theScore and our shareholders.”