Lottery retailer Jumbo Interactive reported a year-on-year increase in revenue and earnings during its 2023 financial year despite having to contend with what it described as “volatile” jackpots.
During the 12 months to 30 June 2022, only five jackpots were greater than AU$50.0m (£25.5/€29.7m/US$32.1m). This, Jumbo said, was significantly less than 13 in the previous year creating less incentives for players to buy tickets.
Jumbo said the first and third quarters were relatively subdued, reflecting the third and fourth lowest average value per jackpot periods, respectively, in four years. In contrast, Q2 included Powerball jackpots of $100m and a record $160m.
The retailer also noted a decline in lottery ticket sales for only the second time in a decade in FY23. However, CEO and founder Mike Veverka was largely upbeat, praising the resilience of the business, and lotteries in general, forecasting further growth in FY24.
“This isn’t the first time we’ve seen an unfavourable run of jackpots,” Veverka said. Pleasingly, our nimbleness means we were able to quickly adapt to the operating environment and flex our cost base.
“Good cost discipline and our ability to drive strong ticket sales at large jackpot levels, particularly in June for the $60.0m and $100.0m Powerball jackpots, meant we were able to exceed our original EBITDA margin expectations.
“Our player health metrics remain robust, despite the unfavourable profile of jackpots, Lotteries remain a category of spend that continues to prove resilient to economic downturns, including the current environment of higher inflation and interest rates.”
