Report Shows Improved Gambling Revenues in Africa
A new in-depth report which examines the gambling industries of South Africa, Kenya and Nigeria shows that gross gambling revenues improved on the continent, despite challenging economies. Price Waterhouse Cooper’s report: Taking the Odds: Gambling Outlook for 2015-2019 focuses on these three countries as leaders in the African gambling industry. South Africa has the largest overall gambling markets with gross casino gambling yields topping R17.2 billion in 2014. Second largest by quite a wide margin is Nigeria with R497 million, followed by Kenya with R218 million.
According to the report, South Africa posted its second largest annual increase of gross gambling revenues in the past five years. The greatest growth was seen in the casino industry, with an increase of 4.5% year on year. As such, it was reported that gross gambling revenues in South Africa increased by R2.1 billion last year. Looking ahead, the PWC report predicts that the country’s gross gambling revenues will expand from R23.9 billion in 2014 to R30.3 billion in 2019 – not including the South African National Lottery.
“Overall, the South African gambling industry continues to remain a vibrant and exciting sector, but is facing significant challenges, in particular a slowing economic climate and changes in regulation,” noted the Gambling Industry Leader for PWC South Africa, Pietro Calicchio.
“An issue of particular concern to the casino segment is that of illegal online gambling. In addition, certain casinos are also facing competition from other gambling facilities opening up in their catchment areas.
“We anticipate slower economic growth to lead to slower growth in gross casino gambling revenues in South Africa and Nigeria, while Kenya’s casinos will face increasing competition from legal online and mobile gambling,” he added.
Looking in particular at the South African gambling market, the report shows that casino gross gambling revenues account for the bulk of this market (72%), although this was a drop from 2013 which reflected 76%. Out of the potential 40 casinos allowed in South Africa, all but two are in operation. PWC points out that the Department of Trade and Industry announced recently that it intended increasing the number of casino licenses to 41.
Calicchio said that the report predicts that growth gambling revenue will drop slightly in 2015 to 0.4% which reflects South Africa’s slowing economy. However, modest improvements are to be expected as conditions stabilize and major operators such as Sun International expand some of their properties.