Century Casinos Inks Colorado Online Sports Betting Deal With bet365, Analyst Likes Long-Term Outlook

Posted on: May 20, 2020, 11:31h. 

Last updated on: May 20, 2020, 11:49h.

Todd Shriber @etfgodfather Read More
Expertise: Financial, Gaming Business, Mergers and Acquisitions.

Century Casinos (NASDAQ:CNTY) is adding to its sports betting offerings in Colorado. It has announced a partnership with bet365 that will see the companies offer offer internet and mobile sports betting in the Centennial State as the sports calendar increases following the coronavirus shutdown.

Century Casinos Sports Betting
Century Casinos could get some help from Missouri reopenings and the return of sports to boost Colorado wagering. (Image: KAIT-8 News)

The deal with bet365 is for the second of Century’s three internet betting licenses in its home state. The first was inked with Circa Sports earlier this year. Financial terms of those agreements haven’t been released. Century has one more Colorado online sports wagering license available.

The online sportsbook operations agreement with bet365 is a 10-year agreement that includes a minimum annual revenue guarantee and a percentage share of net gaming revenue payable to the Company each year, with an advance fee being paid on contract signing,” according to a statement.

Centennial State voters approved sports wagering last November and it went live on May 1, though opportunities for bettors were initially limited. Action could start to pick up, as NASCAR resumed last weekend and the addition of a number of non-conventional golf offerings.

More Sports, Reopening Help

The COVID-19 pandemic is decimating estimates for the first-year of sports betting in Colorado. The NHL and the NBA – one of the most-wagered leagues in the US – suspended seasons before the playoffs started, and Major League Baseball hasn’t even started its 2020 edition.

Those factors, among others, are prompting experts to speculate the Centennial State could actually turn a small loss on sports wagering this year unless professional sports rapidly resume and the NFL season proceeds as expected.

Century, which operates two casinos in its home state, is feeling plenty of coronavirus impact as well. But the company said earlier this week it’s reopening eight casinos in Poland, taking a step in the right direction to get operations back to normal. That’s pivotal, because some analysts say the company’s cash position is stretched.

“The company’s current liquidity position is somewhat stretched relative to those of its peers, in our view, as net of cash needed to reopen the business, we estimate the company could endure a zero- revenue environment for an additional four months (August 2020),” said Stifel analyst Brad Boyer in a note obtained by Casino.org.

Relief on the Way

With the sports calendar beginning to add some meat, Century can start capitalizing on its Colorado internet sports betting licenses. Though it’s not immediately clear when the state will allow land-based casinos to reopen.

The company has three other domestic venues – two in Missouri and one in West Virginia. Show Me State casinos have the green light to restart on June 1, while the Mountain State is expected to follow suit on June 5.

“All told, we like the convenience-oriented nature of CNTY’s properties and expect the business to prove resilient on the other side of COVID,” said Boyer.

He has a “buy” rating and $12 price target on the stock.