Deutsche Bank Positive About Sci Games Acquiring NYX Gaming

NYX Gaming Group Ltd. was recently in the news for being acquired by Scientific Games Corp, a lottery services and casino equipment manufacturing business. According to Deutsche Bank Securities Inc, this seems to be a ‘favorable’ industry movement.

 

The confirmation on this deal came earlier in January and Scientific Games will now have access to the sports book (OpenBet) of NYX Gaming. Analysts Danny Valoy and Carlo Santarelli, were reported saying that they regard the acquisition decision to be a favorable one, especially in the backdrop of the recent push to eliminate PASPA as well as the prospect for expanded legal sports book betting. The analysts were actually talking about the U.S. Professional and Amateur Sports Protection Act. At present, the law effectively bans sports betting throughout that nation, with the exception of a couple of states such as the casino dominions of New Jersey and Nevada.

 

The memo has the Deutsche Bank raising the revenue predictions for the acquiring company, i.e. Scientific Games. Analysts are anticipating a largely steady fourth quarter report for 2017, driven by a solid performance by the gaming segment, consistent margin pull and December power in the local lottery segment. The fourth quarter AEBITDA prediction is noted at US$317 million.

 

Estimates for the 2018 AEBITDA of Scientific Games were also raised by the brokerage to US$1.297 billion, driven fundamentally by the high-performance gaming segment. The other possible factor contributing to the earnings may be modestly reduced expenditures on development and research.

 

In the earlier part of the year, Scientific Games had also acquired Red7Mobile Ltd., a digital casino game development business and Spicerack Media Ltd, a social game development company. There was no disclosure on the terms of these deals.

 

In the month of November, Scientific Games reported its revenue for the third quarter as US$768.9 million, indicating an increase of 6.8 percent (year-on-year basis). The net loss of the firm for the same quarter fell from US$98.9 million (November 2016) to US$59.3 million. At the same time, there was a 10% increase in its AEBITDA as it reached US$299.0 million.

 

Scientific Games is a world leader in lottery and gaming services and is dedicated to empowering its customers by offering them world-class gaming experiences. They have a casino, instant lottery and interactive games, that can be accessed by players through three distinct channels: digital, retail or casino.