Gamesys will not break the bank to fund US expansion
Lee Fenton insists investing outside of New Jersey about “sensible economics” and will not be “fantastically expensive” due to existing and potential partnerships
Gamesys Group CEO Lee Fenton has said growing the operator’s US footprint will be a major focus in 2021 as it looks to expand outside of New Jersey.
The group will deploy the latest version of its proprietary Excite platform in the US during H1 2021, following a significant period of investment and scaling up the business.
Gamesys, which owns the B2C gaming brand Virgin Casino in New Jersey and also powers Tropicana’s digital casino in a B2B arrangement, has also committed to doubling its dedicated North America headcount throughout the year.
“We know this is a big focus for our investors, as it is for me and for my management team,” Fenton explained.
“We’re in discussions with potential partners to secure further access into further states. We will have more to say on that in the very near future,” he added.
In its 2020 financial results, Gamesys reported a 6% revenue increase from its Rest of the World (ROW) segment.
This increase was driven by a 25% annual uptick in revenue from the firm’s New Jersey business, which accounted for 70% of ROW revenue at £12.7m ($17.6m).
Eilers and Krejcik Gaming estimated the Virgin Casino brand secured 1.8% of the New Jersey online casino market in 2020, achieving 11th place out of 22 brands.
Discussing the operator’s future in the US market, Fenton hinted at playing it slow and steady in the process to find further partnerships.
“Our ambition in the US is to be there for the very long term,” he explained.
“We’ve already been there for seven years [and] we had a very successful partnership with Tropicana, Eldorado and now Caesars, and that’s going extremely well for us.
“It’s allowed us to power their brand, but also power our own brand in Virgin Casino, so I think that kind of flexibility is important to us in a partner.
“Clearly [it’s about] long-term agreements for a long-term play in the US market, but it’s also about important and sensible economics, knowing what we can bring to the table and the fact that we can command good market share.
“It’s about finding the right partner with the right economic difference,” Fenton added.
Gamesys will also pursue a similar investment and expansion strategy in Canada.
The London-listed firm said it has seen “promising early signs” in the market, with Ontario set to launch igaming in 2021.
Addressing the cost of expansion north of the border, Fenton explained: “In terms of the pushing to the US and in Canada, we don’t have a shortage of cash, but are we expecting it to be fantastically expensive? No.
“We’re going to be competing in igaming and with the relationships that we believe we can create with igaming we don’t expect it to be hugely capital intensive.
“We will have to put kit out there, we will have to go in state-by-state and, of course, that will cost money, but we have plenty of capital available to us to invest and we’re not expecting it [the cost] to be huge,” the CEO concluded.