USA

The US Casino market is estimated to be worth cUS$73bn in 2015 and is the second largest gambling market in the world, after Macau in China. There are two distinct types of casino in the US: tribal and commercial. In 2012 the split between commercial and tribal gaming revenues was 57%/43%.

There are 39 states that have some form of legalised electronic gaming device—including traditional slot machines, video poker and bingo—at tribal casinos, commercial casinos, racetrack casinos, and/or bars, restaurants or other licensed establishments.

In November 2014 Nektan signed an agreement with Spin Games for the creation of the Respin joint venture. The joint venture has a genuinely disruptive business model in a potential $3bn market. 40% of slot machines on casino floors are estimated to be unsupported by the original manufacturer, based on the 2013 figure of 775,000 slot machines in commercial and tribal casinos. The opportunity has arisen due to the reluctance of casino operators to purchase new machines from manufacturers. When slot machines reach their end of contractual life they become unsupported and are therefore suitable for a third party to extend their life and reducing capex requirements for the casino operator. Slot machine manufacturers are focused on designing and selling new machines, principally in less mature gambling markets, therefore the Group’s first mover advantage is expected to be maintained.

The third leg of Respin’s growth strategy is via a Rapid Bingo product. Essentially this is mobile gaming but within the parameters of a casino’s footprint giving customers the ability to gamble whilst sat poolside, in a bar, restaurant or club or at a show or conference.