Veikkaus records a 2020 slip as covid shuts down Finnish arcade venues

Veikkaus, Finland’s state-owned gambling monopoly has published its full-year 2020 results,  disclosing total corporate profits of €680.2m, down 33 % from the previous year.

Veikkaus cited that the decrease was primarily due to the disruption caused by the COVID-19 pandemic as slot machines were closed entirely or in part for a total of around five months. Lottery tax was €151.4m, down 25.4%.

The operator’s gross gaming revenue (GGR) for the year was €1.26bn, down 25.5%. Its GGR by more than €300m throughout the year due to the pandemic. Of the GRR, 56.6% came from the points of sales of the retail network, while 43.4% came from the digital channel, an 11.6% increase.

Veikkaus declared that the improvement in the share of the digital channel occurred due to a drop in the share of point-of-sales gaming following the closure of slot machines for a major part of the year.

Of all gaming, 58.1% took place authenticated using ID checks. For slot machine gaming, the share of authenticated gaming was 11.5%. ID requirements for slots were piloted from October and rolled out nationwide last January.

The total Finnish gambling market amounted to around €1.585bn, down 21% in terms of GGR in 2020. Veikkaus’ share of the total market was about 80%.

The operator’s share of the total online market was around 63%, and the total amount wagered on Veikkaus games was around €8.20bn.

Veikkaus commissioned two surveys from Taloustutkimus market research company in 2020, concerning gambling problems. The average prevalence of gambling problems in the two surveys was 2.5%.

The operator stated that even when slot machines were open, outside the four months of closure in spring and again in large parts of the country from November, only a smaller number of the machines were allowed to operate to ensure a safe distance between the machines to comply with COVID protocols.

Revenues were also affected by the lack of professional sports worldwide which caused a reduction in the availability of betting markets.

CFO Regina Sippel said: “We had to take major, even difficult, decisions, on a tight schedule at Veikkaus due to the coronavirus epidemic in 2020, in order to protect the health of our staff, customers, and retailers.

“To Veikkaus, just as to many other companies, the year of the coronavirus was challenging; however, it was also a year of positive, remarkable solutions that have enabled the building of a more responsible gaming environment.”

Veikkaus’ strategy and CSR programme were updated in 2020, focusing on player responsibility.

Hanna Kyrki, SVP legal affairs and CSR, added: “The updated strategy is based on an even safer and more responsible gaming environment. Despite the challenges and insecurity caused by the epidemic, we made major decisions to work on the building of a more responsible gaming environment in 2020.”

Veikkaus’ major policy change during the year was a reduction in the total number of slot machines on its retail network, by around 8,000, or 40% of its machines. The maximum number of machines now permitted in one location is four, but previously, 15 slot machines were allowed for the largest retail units.

The operator also made preparations for the compulsory identification of players across all of its games in 2020, which it hopes to enforce by 2023. Its introduction is estimated to reduce player losses by around €300m each year.

Veikkaus also launched a €500 maximum daily loss limit for ‘fast-paced online games’ such as online lottery games, slots, bingo and table games, with an exception for poker. This is expected to remain in place until at least March this year.

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