Gaming market review


South African gaming market1
  Sector – R million   2014   %  
2013   %  
  Casino   16 599   3.3   16 068   7.1   14 998  
  Lottery   2 279   (7.1)  2 453   1.6   2 415  
  Betting   2 984   8.3   2 755   22.9   2 241  
  LPM   1 798   17.0   1 537   23.0   1 250  
  Bingo   515   40.3   367   42.7   257  
    24 174   4.3   23 180   9.5   21 161  
  Casino   69%     69%     71%  
  Lottery   9%     11%     11%  
  Betting   12%     12%     11%  
  LPM   7%     7%     6%  
  Bingo   2%     2%     1%  

Statistics are for the year ended June.  
Lottery revenues are stated at 50% of ticket sales (in line with the policy of the lottery to pay out 50% of sales in prizes).  
Sources: National and Provincial Gambling Boards, Gidani and internal estimates where published information is not yet available.


For the year ended 30 June 2014, the legal gaming and lottery market is estimated to have grown by 4.3% to R24 billion. The casino sector, with 69% of the market, continues to dominate the South African gaming market but is under increasing pressure from the rollout of electronic bingo terminals (EBTs), limited payout machines (LPMs), sports betting and illegal slot and internet gambling operations.

Online gambling remains illegal in South Africa and no reliable data is available for this sector.


The casino sector is estimated to have grown by 3.3% to R16.6 billion for the year under review. Casino revenues grew by 2.4% in Gauteng, 7.1% in the Western Cape, 4.0% in the Eastern Cape and 3.6% in KwaZulu-Natal.


Betting revenue, until recently dominated by horse-racing, is estimated to have grown by 8.3%, with the growth coming from the sports betting sector.

An important trend over the past few years has been the increasing contribution from sports betting, which has rapidly increased from R122 million, or 7.5% of the sector’s revenues for 2011, to an estimated R1 229 million for the period under review, or approximately 41% of the sector’s revenue.

Based on Phumelela’s Annual Report for the 12 months ended January 2014, we estimate that local horse-racing revenues have declined by 0.8%. Horse racing is now estimated to contribute 59% of this sector’s revenue.

Limited Payout Machines

Growth in the LPM sector has remained strong and revenues are estimated to have grown by 17.0% during the period under review to R 1 798 million. In the Western Cape, revenue increased by 16.1% to R582 million, in Kwa-Zulu Natal by 17.5% to R419 million, in Gauteng by 22.4% to R305 million and in the Eastern Cape by 21.9% to R202 million.

LPMs are available in all provinces except the Northern Cape.


Bingo is now available in Gauteng, North West, Mpumalanga and Eastern Cape. Overall Bingo revenues are estimated to have grown by 40.3% to R515 million for the year ended June 2014. The largest portion of this revenue is earned from EBTs, which are, in reality, slot machines.

Gauteng revenues increased by 22.3% to R429 million during the year ended June 2014.

Bingo is now available in Middelburg and Ermelo in Mpumalanga. In addition, three venues opened during the year under review in the North West province in Brits, Rustenburg and Potchefstroom.

In the Eastern Cape there are now EBT sites in Mthatha, Port Elizabeth and East London. The Port Elizabeth licence located at Moffet-on-Main opened in March 2014, 12 kilometres west of the Boardwalk Casino. Further licences have been issued and are in the process of opening in Bethelsdorp and Jeffreys Bay. The Eastern Cape Gambling and Betting Board is presently considering applications for the granting of licences in Uitenhage and other Eastern Cape magisterial districts.

The KwaZulu-Natal Gaming and Betting Board is at the public participation stage of licensing the playing of bingo by means of EBTs.

This rapidly growing sector continues to impact casino revenues negatively.

1 The National Gambling Board has not yet published the gambling statistics for the 12 months ended March 2014. We have therefore relied on revenues provided by provincial regulators to calculate the 2014 gaming market for Gauteng, Western Cape, KwaZulu-Natal, Eastern Cape and Mpumalanga. Estimates have been included for the Northern Cape, Limpopo, North West and Free State provinces as no information is available from the respective regulators. Prior year figures have been updated where necessary based on the gambling statistics published by the National Gambling Board for the 12 months ended March 2013.


Estimated market share of casino revenue
    Sun International   Tsogo Sun   Peermont   Other*  
  Province   FY2014   FY2013   FY2014   FY2013   FY2014   FY2013   FY2014   FY2013  
  Gauteng   18.6   19.0   53.4   52.5   23.5   24.0   4.5   4.5  
  Western Cape   84.1   83.3   15.9   16.7   –   –   –   –  
  KwaZulu-Natal   35.9   35.3   58.5   59.1   5.6   5.6   –   –  
  Mpumalanga   –   –   76.1   76.1   23.9   23.9   –   –  
  Limpopo   81.4   80.3   –   –   18.6   19.7   –   –  
  North West   79.6   79.6   –   –   20.4   20.4   –   –  
  Northern Cape   80.5   79.2   –   –   –   –   19.5   20.8  
  Eastern Cape   72.1   70.7   27.9   29.3   –   –   –   –  
  Free State   70.2   69.7   24.5   25.4   5.3   5.0   –   –  
  Total   42.4   41.9   41.7   41.8   13.8   14.1   2.1   2.2  

* Other:
   Gauteng: London Clubs, Emerald Casino
   Northern Cape: Desert Palace 


The National Gambling Board and provincial gambling boards do not provide detailed market share statistics for our competitors.

We have been able to determine the market share of a competitor in a province where only the Group and one other operator compete. These provinces include the Western Cape, Eastern Cape, Limpopo, Northern Cape and North West. For the other provinces where there is more than one competitor, we have estimated their share of the provincial market based on publicly available information.

The Group’s share of the South African casino market is estimated to have increased from 41.9% to 42.4% for the year ended June 2014.

Gaming licencing developments

The Burgersfort licence issued to a Peermont Global subsidiary by the Limpopo Gambling Board is currently under construction. Peermont plans to spend R320 million and the development will include an 80-key three star hotel, a casino with 150 slot machines and eight gaming tables, and a conference centre. The property is due for completion in April 2015.

A licence was issued to Leithlo Resorts in Kuruman in the Northern Cape. NIVEUS Limited acquired a 60% interest in the Kuruman casino licence. Construction has started and the casino is expected to be operational in 2014.

The Mpumalanga Gambling Board (MGB) has done away with the previous zoning of the province, which prescribed one casino licence for each of the four zones. The MGB withdrew the request for proposals (RFP) for the fourth licence in the province in July 2013 and a revised RFP was issued. After receiving a revised bid from Tsogo Sun in January 2014, the MGB has advised that the process has again been cancelled.


The Chilean gambling market includes casinos, horse-racing and a national lottery.


There are two casino regulatory structures in Chile. The Superintendia De Casinos de Juego (SCJ) regulates the 18 new casino licences made available in 2005. Of these, 16 licences are currently operating. The Termas de Casino, a SCJ licenced casino in Region VIII, closed in October 2013. No new casinos opened during the year.

There are also seven municipal casinos operating in the resort areas that were established under the previous dispensation. These casinos are operated independently of the SCJ and the conditions of these licences have remained unchanged since 2005. By 2015, all municipal casinos must conform to SCJ legislation and control.

Chilean SCJ casino market revenue

The introduction of the ban on smoking in all Chilean casinos at the beginning of March 2013 adversely impacted casino revenues. Revenue for all the SCJ casinos declined by 13.9% for the year to 30 June 2014 to CLP237 billion.

The ban continues to negatively impact revenues and overall casino revenues remain 11.9% below the casino revenues for the year ending June 2012, when no smoking ban was in place.

In September 2013, Monticello opened two smoking terraces with two more opening in October 2013. These terraces have been well accepted; by the final quarter of the year ended June 2014, casino revenues were only 5.4% below 2012 levels when no smoking ban was in place. For the remaining 15 SCJ casinos, revenues were 14.3% below 2012 levels.

Monticello’s share of the SCJ casino market has increased from 27.2% to 28.6% for the year ended June 2014. The Group’s weighted average share of gaming positions in the SCJ regulated casinos grew by 1.2% to 19.0%.

      Gaming revenue   Gaming positions*  
  Casino   Region   FY2014   FY2013   FY2014   FY2013  
  Monticello Grand Casino   VI   28.6   27.2   19.0   17.8  
  Marina del Sol   VIII   11.6   11.9   13.5   13.3  
  Enjoy Santiago   V   11.5   13.5   13.9   14.1  
  Enjoy Antofagasta   II   9.4   9.3   8.4   8.2  
  Dreams Temuco   IX   7.1   6.9   6.7   6.8  
  Dreams Punta Arenas   XII   5.4   5.1   4.3   4.4  
  Casino Sol Calama   II   4.6   4.8   4.6   4.7  
  Gran Casino de Talca   VII   4.2   3.7   4.4   4.5  
  Dreams Valdivia   XIV   3.4   3.5   4.1   4.2  
  Antay Casino & Hotel   III   3.4   3.9   4.2   3.7  
  Casino Sol Osorna   X   2.4   2.5   3.7   3.7  
  Casino de Colchagua   VI   2.1   2.0   2.9   2.9  
  Casino de Juegos del Pacifico   V   2.1   2.0   3.5   3.6  
  Casino Grand Los Angeles   VIII   1.7   1.4   2.1   2.1  
  Dreams Coyhaique   X   1.3   1.3   1.7   1.8  
  Enjoy Chiloé   XI   1.0   0.9   2.8   2.8  
  Termas de Chillán   VIII   0.0   0.1   0.0   1.5  
  Total     100   100   100   100  

Statistics for the year ended June.
Positions are one per slot machine and six per table.
Source: Superintendia de Casinos de Juego (SCJ).
* Weighted average 


Santiago casino market revenue

There are two SCJ casinos that compete for the Santiago Metropolitan Region casino market: Monticello in Region VI, south of Santiago and Enjoy Santiago, Region V, north of Santiago. The Santiago Metropolitan Region has no legal casinos.

The two casinos generated total gaming revenue of CLP95 billion for the year ended June 2014, compared to CLP112 billion for the previous year.

The introduction of the smoking ban in March 2013 adversely impacted revenue of both casinos. Monticello’s revenue was down 9.7% for the 12 months ended June 2014, compared to 2012 when no ban was in place. Enjoy Santiago’s casino revenue has declined by 18.8% over the same period.

The Group’s share of the Santiago casino market, based on reported revenues by SCJ, increased by 4.4% from 66.9% to 71.3%. Monticello continues to earn a significantly higher portion of the Santiago casino market.

      Gaming revenue   Gaming positions*  
  Casino   Region   FY2014   FY2013   FY2014   FY2013  
  Monticello Grand Casino   VI   71.3   66.9   57.8   55.7  
  Enjoy Santiago   V   28.7   33.1   42.2   44.3  
      100   100   100   100  

Statistics for the year ended June.
Positions are one per slot machine and six per table.
Source: Superintendia de Casinos de Juego (SCJ).
* Weighted average  




The new Lansmore Hotel, operated by Lohnro Hotels, opened in July 2012. The Masa Towers casino, that was to have been operated by Tsogo Sun, has recently had their application to open declined by the Casino Control Board.


The Hilton Hotel, adjacent to the Kalahari Sands, opened to the public in May 2011. The planned casino has, however, not yet opened.

The casino licence was issued in July 2012 and it is anticipated that the proposed casino will have a material impact on gaming revenues at Kalahari Sands.


As reported previously, The Happy Valley casino opened in September 2009 with 112 slots and 15 tables. It is located some seven kilometres from the Group’s Royal Swazi Spa casino.

Casino revenues at Royal Swazi Spa have recovered from the previous report.


The Group’s Federal Palace casino is the only licenced casino in Lagos State. However, the illegal casinos on Victoria Island, which do not have formal licences, continue to operate.

Lagos State Government officials were engaged on the closure of these illegal casinos. The State Government will continue to be engaged to give effect to their commitment to close illegal casinos, in terms of legislation whereby only three licenced casinos will operate on Victoria Island.

The operation of these illegal casinos continues to affect the profitability of the Federal Palace casino.


The Group has a gaming licence but does not currently operate a casino in Zambia.


There are no competitor casinos in Lesotho.