The PointsBet Holdings Ltd (ASX: PBH) share price will be on watch this morning after the online bookmaker announced it had been appointed as the official betting partner of LaLiga North America. Despite the news, the PointsBet share price opened 3.9% lower at $3.20.
Details of the LaLiga deal
Under this new agreement awarded to PointsBet’s wholly-owned subsidiary, PointsBet USA, the company has been appointed as LaLiga North America’s official betting partner.
Through this new deal, the online bookmaker will gain exposure to LaLiga’s large and fast-growing audience across North America. The deal is exclusive and has been put in place for several years.
The new deal will enable PointsBet to work with the governing body on industry practices in order to maintain the integrity of LaLiga games.
PointsBet’s strategy in relation to the deal will be to incorporate multilingual content across LaLiga North America’s portfolio of programming properties. This strategy includes the creation of a new product named “PointsBet Prediction of the Week”. This new product will be marketed to targeted audiences in both English and Spanish across the LaLiga network.
Recent Indiana announcement
Just last week, PointsBet announced it had launched operations in the State of Indiana after receiving Mobile Sports Wagering Launch Authorisation from the Indiana Gaming Commission.
The approval was awarded to PointBet’s wholly-owned subsidiary, PointsBet Indiana. The Indiana market represents the company’s third digital sportsbook operation in the United States.
The online bookmaker now believes it will be in a good position to effectively compete and raise its market share in Indiana.
Recap of recent financial results
In its first-half FY20 results, PointsBet delivered normalised turnover of $533.1 million, which represented very strong growth of 154% over the prior corresponding period (pcp).
Revenue also grew very strongly by 127% to $27.4 million. This growth was driven largely by a sharp rise in client numbers following PointsBet’s expansion in the United States. At the end of the period, the company had a cash balance of $157.5 million.
However, the company posted a normalised earnings before interest, tax, depreciation and amortisation (EBITDA) loss of $28.35 million for the half. This was due to a significant increase in operating expenses, driven by marketing, employee benefits and information technology costs. The company’s global strategy has seen it invest heavily to position the business for future growth and profitability.
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Phil Harpur has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Pointsbet Holdings Ltd. The Motley Fool Australia has recommended Pointsbet Holdings Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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