Incoming Bally's Corp CEO Robeson Reeves has his hands full in his new role with the company, following the operator's troubling Q4 numbers to end 2022.
On Thursday, Bally's reported a $425.5 million loss for FY2022 after a massive fourth-quarter loss of $487.5 million for the casino, resorts, and legal sports betting giant.
All of this came as a result of a $390.7 million fourth-quarter writedown for troubled North American assets' Bet.Works and Monkey Knife Fight.
During Thursday's Q4 and Full Year earnings call, Bally's also confirmed that its struggling North American Interactive unit suffered a net loss of $428.1 million in 2022, due to poor results from its online sports betting sites.
In comparison, the company reported that its iGaming arm enjoyed notable gains in market share in both Ontario and New Jersey.
Interactive division to undergo restructuring and platform upgrade
During his introductory earnings call remarks, Reeves was quick to call out the failure of Bet.Works delivering the level of performance that its Bally Bet sportsbook required.
He indicated that "nimble solutions" and "choice of technology" would now be of uppermost urgency in the company's new strategic approach, and that an alternative to its existing online sports betting tech was under consideration.
"On sports, we recognize that the Bet.Works acquisition did not give us the platform required to develop a competitive product," said Reeves during the earnings call.
"We didn't react fast enough there, and this will not happen again. We are confident there are more economical and nimble solutions out there and have spent the past five months analyzing them deeply."
Reeves also reiterated that the restructuring effort first announced in January would place "primary focus" on North America and also represent an "opportunity to streamline all of Interactive."
iCasino to the forefront in Ontario and Pennsylvania
More significantly, Reeves revealed that Bally's will be shifting focus from sports betting to its online casino, while the company repositions its Bally Bet online sports betting arm and focuses on its potential as a customer acquisition platform.
"In North America our upward trajectory on iCasino continues," said Reeves. "Our business in New Jersey has started to accelerate further with new payment methods and other options across Ontario and other markets too. Ontario trends look very, very similar. We've planned to launch in Pennsylvania in the first half of 2023 and will continue to be iCasino first."
Owing to the restructuring of its Bally Bet unit, Bally's North American Interactive division is only expected to teeter into profitability in 2024. When an industry analyst tried to get Reeves to provide greater detail on that trajectory, the new CEO again emphasized that Bally's will be "playing to our strengths" in iCasino to pave the way to profit.
"We're in it for the absolute long haul, but we're not going make the same mistakes we made previously...and we're going to play to our strengths and we know that we are fantastic in iCasino. Everything you can see in our business shows that."
Follow the data
During his opening remarks, Reeves explained that he intends to take a data-driven approach to achieve profitability in 2023 while focusing on scalability.
"Many of you will be wondering how I'll lead the business," said Reeves, addressing himself directly to industry analysts. "You should expect me to follow the data. I'll be analytical in our approach to decision-making to deliver customer-centric profitable solutions. I believe that the most valuable asset to deploy is focus. I will focus on opportunities with scale and go after them harder."
Bally's casinos, resorts, and interactive segments set new records
Bally's overall revenue growth in 2022 was driven by the record performance of its casinos and resorts division which posted revenue of $1.23 billion for the full year — marking a healthy 19% gain over the $1.03 billion registered in 2021.
Meanwhile, Bally's International Interactive unit saw its revenue soar to $946 million in 2022, nearly triple the $251 million recorded in the previous year, while North American interactive generated revenue of only $81.7 million in 2022.
Bally's also confirmed its FY2023 earnings guidance of $2.5 billion rising to $2.6 billion.
