BetMakers Technology Group plans another $9.7 million investment into product development and fixed odds horse betting in fiscal year 2024.
The company made the announcement Wednesday during its fiscal 2023 investor call to close out fiscal 2023, which produced a negative adjusted EBITDA of $18 million. Executives for the Australia-based company pointed to its initial $9.7 million fiscal 2023 investment in fixed-odds horse betting and its Next Gen technology platform as a reason for the negative adjusted EBITDA.
About $4.5 million of that investment, or A$7 million, went directly into fixed odds betting.
“Within our FY23 negative EBITDA result, it is important for our investors to understand that A$7 million was invested into fixed odds (horse betting), which we think is an incredible opportunity for our company and shareholders,” Matt Davey, President and Executive Chairman of BetMakers said.
Slow growth for fixed odds horse betting
In May, BetMakers launched MonmouthBets, America’s first legal mobile app for fixed odds horse betting. It is only available in New Jersey.
Davey said they are seeing positive signs for fixed-odds betting in the US, though expansion is not moving as fast as BetMakers would like.
“We are seeing other states move in that direction,” he told investors Wednesday. “Clearly, New Jersey is the market leader.”
What is the future of US fixed odds horse betting?
Colorado is the only other US market where fixed odds horse betting is legal, though it is not currently offered.
CEO Jake Henson added the company is immediately focused on delivering its fixed-odds product in New Jersey to build viable metrics to show other states with the hopes of more widespread adoption.
Horse betting partnerships with BetMakers
BetMakers announced multiple horse betting partnerships during the last fiscal year. It is the exclusive provider of pari-mutuel racing services for in-person Caesars Sportsbooks in Nevada.
Executives expect to be active in 26 additional Caesars locations in Nevada by next July.
BetMakers also partnered with The Stronach Group‘s 1/ST Content to distribute its Global Racing Network into US markets.
Restructuring to reduce costs
North American CEO Christian Stuart stepped down in April as part of the company’s restructuring.
BetMakers also laid off 128 employees during fiscal 2023 to reduce its cost base. BetMakers expects to save $4.1 million in operating costs in this fiscal year.
BetMakers closed the fiscal year with $61.5 million in revenue, up 3.7% from the prior fiscal year.
When to expect positive cash flow for BetMakers
Executives pointed to the launch of its Next Gen technology platform for its annual revenue increase. Opening the first US online fixed odds horse betting market in New Jersey helped, too.
“Generating positive operational cash flow is a focus for us this year,” BetMakers CFO Anthony Pullin told investors Wednesday. “We are still working through some of that operation review across our process, and we are also progressing on delivering on some key contracts.”
Once both aspects are complete, Pullin says BetMakers expects to be cash-flow positive.