- »Atlantic Lottery 2019-2020 Year Sends $395M to Provinces
Atlantic Lottery 2019-2020 Year Sends $395M to Provinces
The Atlantic Lottery Corporation (ALC) released its final 2019-2020 financials. The overview showed that ALC returned $395.4 million to the four Atlantic provinces during the fiscal year. While the goal had been $419.4 million, the coronavirus pandemic cut that short and resulted in a lesser amount.
As for the 2020-2021 year in progress, the pandemic continues to affect the bottom line. To minimize the harm, however, ALC has implemented a new plan to rely more heavily on digital revenue.
The official press release from ALC regarding the 2019-2020 year-end numbers focused primarily on the profits returned to the provinces. That total came to $395.4 million, which was distributed as follows:
- Nova Scotia = $131 million
- New Brunswick = $124.5 million
- Newfoundland and Labrador = $121.1 million
- Prince Edward Island = $18.7 million
Since ALC is publicly-owned, the entirety of its profits goes to the provinces. The most recent numbers bring the total distributed profits since its founding in 1976 to more than $10 billion.
Of the $395.4 million, ALC President and CEO Chris Keevill noted, “Although this number fell short of our original target as the Covid-19 pandemic flattened revenues toward the end of the fiscal year, the profit trajectory for the year was approaching the $419.4 million goal.”
Provinces did feel the pain from the final distributions, though it was not unexpected due to the pandemic. The previous fiscal year of 2018-2019 delivered more than $422 million to the four provinces.
Overall, ALC did see it coming a few months into 2020. Its May assessment indicated sales down 10% for the last quarter, though it could have been worse if not for the online lottery ticket sales that increased over time.
Examining the Numbers
Of the $395.4 million distributed to the provincial governments in Atlantic Canada, the majority ($275.5 million) came from the destination business side of ALC. The rest ($137.9 million) resulted from retail and online lottery profits.
Regarding the $419.4 million goal that ALC missed, $15.5 million of the missed revenue was a result of the coronavirus-mandated destination casino closures. Retail and online lottery missed its part of the goal by $8.5 million.
As for the financials of the 2019-2020 fiscal year, the full report provided these numbers (in thousands):
- Total assets = $264,436 (up $35,845 from previous year)
- Total liabilities = $198,993 (up $13,812 from previous year)
- Total shareholders’ equity = $65,443 (up $22,033 from previous year)
- Total revenue = $725,484 (down $39,350 from previous year)
- Gross profit = $591,034 (down $30,671 from previous year)
- Net profit = $395,683 (down $26,558 from previous year)
Profits by province showed Newfoundland & Labrador with the largest discrepancy and Prince Edward Island with the least. But looking at overall profits for the region, the breakouts by business were:
- Retail lottery = $122.1 million (down $24.6 million year-on-year)
- Destination = $257.5 million (down $7.7 million year-on-year)
- Online lottery = $15.8 million (up $5.5 million year-on-year)
Major lottery winners ($10,000 or more) during the 2019-2020 fiscal year broke down as follows:
- Nova Scotia = 177 wins
- New Brunswick = 175 wins
- Newfoundland & Labrador = 147 wins
- Prince Edward Island wins = 34
Draw lottery games garnered $164 million in gross gaming revenue, down 8% year-on-year. The revenue came from:
- Lotto MAX = $65 million
- Lotto 649 = $39 million
- Tag = $25 million
- Atlantic 49 = $11 million
- Twist = $9 million
- Daily Grand = $4 million
- Other = $10 million
Instant games delivered net revenue from these two forms:
- Digital instant games = $10.6 million
- Online bingo = $2 million
Sports revenue for 2019-2020 came to $13.2 million. Internet sales of sports wagers increased 42% from the previous year with 20% more active player accounts.
Video lottery sales declined on an annual basis, again due to coronavirus impact. The sector was set to improve $1.6 million year-on-year until the March shutdowns that ended with a decrease overall.
Red Shores delivered $19 million in annual gross gaming revenue, this, too, stymied by the virus. Casino games brought in $13.9 million of that number, with $2 million generated by racing and $3.1 million by food and beverage sales.
Commitments to Communities
ALC offers a clear breakdown of its financial distributions, with 100% of unconsolidated profits going to the four shareholder governments. The breakdown of distributions, specifically for the 2019-2020 year, were:
- 38% = $449.7 million to prize winners in Atlantic Canada
- 34% = $395.4 million to four provinces
- 11% = $122.2 million to nearly 4,000 retailers for commissions
- 5% = overall Atlantic Canada operations related to 8,087 jobs
- 4% = Atlantic Lottery employees (more than 650)
- 4% = Atlantic Lottery partners outside the region
- 4% = taxes
Its commitment to social responsibility breaks down into six sectors, starting with players and products, retailers, employees, and communities. They are all rather self-explanatory. The fifth sector is the supply chain, which refers to vendor management and best practices. The final one is environmental stewardship, which is the ALC’s way of minimizing its impact on the environment and reducing its corporate footprint.