Atlantic Lottery
Annual Report
2023-2024
Our Social Purpose
To make a game-changing impact for the people and places of Atlantic Canada.
- No matter where you live in Atlantic Canada, the impact of Atlantic Lottery is all around you.
- Our impact builds and betters our communities. We put everything we do and 100% of the profits we make into giving back to our home. Lottery profits are not ours; they are returned to our provinces and invested in our communities for the good of everyone.
- Our impact puts the interests of Atlantic Canadians first. We play fair and keep the fun in the game. We champion healthy play and support players. We are committed to being open and transparent. Trusting who you’re playing with and knowing where the money goes matters.
- We’re proud to share playing and winning experiences with Atlantic Canadians that keep the benefits here - making a positive and lasting difference that’s nothing short of game-changing.
Chair Message
Atlantic Lottery’s 2023-24 annual report highlights an impressive year of strong performance, balanced with significant progress in our commitment to healthy play.
In 2023-24 we returned $487 million in profit to the four Atlantic provinces, which contributes to vital public services that directly benefit Atlantic Canadians, including health care, infrastructure and education. As a publicly owned corporation and a government-regulated and responsible provider of gambling and sports-betting products, we take great pride in returning 100 per cent of our profit to the Atlantic provinces, further strengthening our region.
We are operating in an increasingly competitive environment due to the rise of gambling sites that cannot legally operate in Atlantic Canada, with nearly $200 million leaving our region each year to benefit operators outside Atlantic Canada. To address this, we are always seeking new ways to educate Atlantic Canadians about the risks of these unregulated sites, while continuing to grow and evolve our products to meet the expectations of our players.
We saw strong performance in our iLottery line of business, with an increase of 17 per cent over the previous year. This is largely due to the successful launch of Newfoundland and Labrador’s online casino, which contributed to the continued growth of alc.ca.
While we aim to provide fun games that entertain our players, we also work hard to prioritize our healthy play tools, which is another key differentiator that sets Atlantic Lottery apart from illegal gambling operators. We launched several new healthy play initiatives in 2023-24, including contests and promotions to increase adoption of our responsible gambling tools, new traditional and digital marketing materials to improve gambling literacy, sending emails to players who demonstrate high-risk behaviour, and providing players with more insight into the way they play and access to more tools to help manage their play.
The Board continues to provide a strategic governance role for Atlantic Lottery’s operations, identifying cybersecurity; environmental, social and governance (ESG); succession planning; and diversity, equity and inclusion (DEI) as corporate focus areas in 2023-24. With the help of a newly formed Social Responsibility and Sustainability Board Committee, we will ensure sustainability is a key consideration in everything we do. As Atlantic Lottery makes progress toward developing new ESG goals, healthy play will remain a key area of focus that we look forward to advancing in the year ahead.
Sincerely,
C. Sean O’Connor, CPA, CA
Chair, Board of Directors
CEO Message
I’m proud to mark another year of game-changing impact at Atlantic Lottery. In 2023-24, we remained focused on serving Atlantic Canadians who choose to play with a regulated option, tackling the illegal gambling market, providing social and economic support to local communities in Atlantic Canada, and educating Atlantic Canadians about healthy play.
As a purpose-driven organization, we are excited to take our long-standing commitment to social responsibility a step further by starting to develop a new ESG framework. This work began in 2023-24 with the intention of helping us evaluate our current environmental, social and governance practices, while also considering new initiatives to guide our journey forward.
Through our initial consultation process, Atlantic Lottery has created five focus areas for the framework: Climate, Healthy Play, Community Impact, IDEA (inclusion, diversity, equity and accessibility), and Data Security and Privacy, each accompanied by an “ambition statement” provided in this report. Over the course of 2024-25, we plan to further develop objectives for each focus area and establish a process for reporting on our progress to the public. Plans are already underway to conduct a climate assessment this fall, which will assess the impact of our operations while also identifying potential areas for improvement.
While we look forward to exciting initiatives still to come, Atlantic Lottery is also thrilled to celebrate our achievements throughout 2023-24 in support of our region, from returning $487 million to the four Atlantic provincial governments and enhancing our robust healthy play initiatives, to supporting more than 100 grassroots community events that truly represent the incredible diversity of Atlantic Canada. We partnered with a wide range of festivals and events through sponsorship and volunteer hours during the past year, including the River of Pride Festival, the Festival Bluegrass Évangéline and the North American Indigenous Games, just to name a few.
In addition to returning 100 per cent of our profit to the Atlantic provinces and supporting community events, we are pleased to further strengthen the region we call home by keeping 91 cents of every dollar here in Atlantic Canada. This includes retailers who receive commissions, prizes given to winners, salaries and benefits for our more than 700 employees, and our Atlantic Canadian operations, which indirectly contributed to more than 8,300 jobs and $2 billion in economic activity in 2023-24.
I am proud of all that our team has accomplished over the past year to delight our players and make a meaningful contribution to all Atlantic Canadians. I hope you’ll join us in 2024-25 as we continue to progress as a responsible gaming company driven to make a game-changing impact for the people and places of Atlantic Canada.
Sincerely,
Patrick Daigle
President and CEO
Executive Summary
In 2023-24, Atlantic Lottery remained focused on providing an exceptional player experience and delivering sustainable profits to the four Atlantic provinces, resulting in a return of $487 million to help fund essential programs and services. This support for our region is balanced with our continued commitment to social responsibility and industry-leading healthy play tools.
Our profit decreased by $5.2 million compared with the prior year, however, these results were anticipated due to ongoing investments in Atlantic Lottery’s operations, people and future. Our actual profit represents an increase of $1.6 million above the budgeted profit.
In 2023-24, $256.5 million was delivered from the Destination line of business and $230.5 million from the Retail and iLottery lines of business. In addition to the profit distributed to the provincial governments, Atlantic Lottery remitted $60.6 million to the provincial and federal governments in taxes and federal contributions.
The launch of Newfoundland and Labrador’s online casino was a key milestone that supported the continued growth of the alc.ca platform in 2023-24. The strong performance of our online offerings is an integral contributor to our growth and success. Gross gaming revenue for the iLottery line of business increased significantly by $24.7 million, or 17 percent, from the prior year. Despite this growth, Atlantic Lottery's digital offering represents a 22 per cent market share of total online betting and gaming activity in the region.
Atlantic Lottery is proud to provide Atlantic Canadians with a regulated gaming option while working to compete with the illegal gambling market. We continue to collaborate with new gaming vendors to ensure our players have access to a strong portfolio of entertaining games, supported by a robust range of healthy play tools.
We are always exploring new ways to modernize the retail space in partnership with our retailer networks through initiatives such as digital signage, self-serve terminals and new video lottery terminals, as well as the upcoming launch of a new generation of lottery retail terminals.
Red Shores delivered a profit of $3.9 million, representing a 30 per cent increase over budget. Due to renovations that began in 2023-24, Red Shores’ profitability decreased by $1.8 million from the prior year.
Profit by Province (in millions)
Community Impact Report
As a purpose-driven organization, Atlantic Lottery focuses on serving Atlantic Canadians who choose to play with a regulated gaming option, reducing the illegal gambling market, providing social and economic support to local communities in Atlantic Canada, and educating Atlantic Canadians about healthy play.
We take our role as Atlantic Canada’s only legal provider of online gambling and sports-betting products very seriously and we consider the impact on local communities in everything we do. Each year, 100 per cent of Atlantic Lottery’s profit stays here in Atlantic Canada to support vital services like education, health care and infrastructure. We know many Atlantic Canadians are seeing advertisements for gambling sites that cannot legally operate in our region; as a result, nearly $200 million is leaving our region each year, which could instead be staying here to benefit our Atlantic Canadian communities.
Atlantic Lottery is constantly evolving to address this challenge by providing our players with fun and entertaining offerings, balanced with our internationally recognized responsible gambling features and resources to promote healthy behaviours. In addition, we build up our region by supporting initiatives, causes and events that align with our values through sponsorship and volunteer hours. Over the course of 2023-24, we were excited to advance our corporate social responsibility journey with a greater focus on environmental, social and governance (ESG) practices as we began developing an ESG framework, while also progressing our inclusion, diversity, equity and accessibility (IDEA) initiatives.
Over the next few pages of our 2023-24 Community Impact Report, we look forward to sharing highlights and progress in several key areas and providing a look at what we hope to achieve in the year ahead.
Healthy Play Commitment
Atlantic Lottery is committed to prioritizing healthy play to ensure our players enjoy our products responsibly – it’s an important component that we consider in everything we do. We want all of our players to use our products for fun and entertainment while clearly understanding how the games work, deciding how much time to spend and playing within their means. We offer a wide range of tools to support healthy play on alc.ca, including mandatory age and identity verifications and mandatory weekly deposit limits – this means every player on alc.ca is required to use some of our healthy play tools to support their play. Other important tools include optional daily wager and time limits, session time caps, pop-up reminders, a personalized PlayWise Rating, and 24-hour break in play or self-exclusion options.
Our robust responsible gambling (RG) tools have received recognition from leading independent accreditation programs, including the World Lottery Association Level 4 Recertification since 2010, and the RG Check Accreditation from the Responsible Gambling Council since 2022. We are also proud that the Red Shores Racetrack and Casino in Charlottetown has maintained the RG Check Accreditation since 2013.
Expanding Our Healthy Play Initiatives
In 2023-24, Atlantic Lottery continued to go above and beyond to encourage healthy play, further developing new initiatives to support our Healthy Play Policy. We expanded our PlayWise Rating program providing additional features, information and communications to give players more insight into the way they play. The program now allows players to receive messages based on their account activity, wins or their use of RG tools. They can also review their statistics and access strategies to improve their rating, such as taking breaks and setting time and wager limits. Recognizing our important role in supporting our players, Atlantic Lottery has started sending emails to players who show signs of high-risk behaviour based on their PlayWise Rating, with suggestions on how they can manage their play.
Contests and Promotions
We launched several contests and promotions to promote gambling literacy and encourage players to adopt healthy play tools in 2023-24. Players who set daily wager and session time limits had opportunities to win prizes such as a VIP Red Shores experience, an electronic scooter prize pack and an espresso machine. Healthy play elements were incorporated in existing contests and promotions, across all product lines. We also developed and deployed a six-month-long marketing campaign with the objectives of increasing the usage of healthy play tools among players and improving gambling literacy among Atlantic Canadians aged 19 and older. As a result, we exceeded our targeted uptake of discretionary healthy play tools by nearly 60 per cent. In fact, players used our discretionary healthy play tools more than 77,000 times during the year.
Brochures and Postcards
Atlantic Lottery updated the content as well as the look and feel of Ticket Lottery healthy play brochures featured in retail locations in New Brunswick, Prince Edward Island and Newfoundland and Labrador. We also incorporated gambling literacy messages in a video lottery promotion to support informed play.
We are now providing updated postcards to Atlantic Lottery’s major winners with information about limit-setting tools, toll-free provincial gambling support numbers and a QR code that provides easy access to healthy play tools. This initiative is intended to create an additional touchpoint on the player journey for those who win prizes of $10,000 or more, to encourage healthy play.
Our Proactive Approach
We are always exploring new opportunities to strengthen our healthy play initiatives to ensure our players have the information and tools they need to enjoy Atlantic Lottery games responsibly. This commitment sets us apart from gambling sites that cannot legally operate in Atlantic Canada. We are proud to be a regulated and responsible organization that takes proactive measures to support our players.
Our ESG Framework
Throughout 2023-24, Atlantic Lottery made progress in our environmental, social and governance (ESG) journey and began the development of an ESG framework. We are proud of the social responsibility initiatives that are already underway within our organization, including our focus on healthy play, community sponsorships and employee wellness, and we look forward to continuing to expand these efforts.
Our initial work to develop our new framework involved research into other Canadian lotteries and major corporations in the Atlantic Canadian region, as well as consultation with our players and other key internal and external stakeholders. Through this process, we have identified five focus areas that are important to Atlantic Lottery and our stakeholders.
We have established a Social Responsibility and Sustainability Board Committee, which is responsible for ensuring sustainability considerations are incorporated into Atlantic Lottery’s operations, decision-making processes and community engagement initiatives. We have also strengthened our approach to data security by introducing a new verification process for bank accounts and an enhanced log-in process to protect our players and improve their user experience.
In 2024-25, we will finalize our ESG framework with targets to support each ambition statement. We are already planning several initiatives for the year ahead, including a climate assessment to identify the impact of our operations and potential areas identified for improvement.
Climate
We demonstrate a strong commitment to addressing climate change within our business.
Healthy Play
We champion healthy play and actively support players who are experiencing concerns related to their gambling.
Community Impact
We maximize our impact by engaging in the communities where we live, work and play.
IDEA
We encourage inclusion to thrive by reflecting the diversity of Atlantic Canada in our workforce, our products and our operations.
Data Security and Privacy
We safeguard our systems and processes to protect our players, employees and partners and keep their trust.
Community Impact Report
IDEA Leadership Council
Atlantic Lottery’s Inclusion, Diversity, Equity and Accessibility (IDEA) Leadership Council continued to advance its mission of fostering an inclusive culture through diversity representation, education and engagement in 2023-24. The council has three focus areas, including:
- Inclusion and Accommodation: Creating welcoming and supporting environments for all
- Diversity Representation and Celebration: Honouring and showcasing the rich diversity within Atlantic Lottery
- Education and Awareness: Promoting understanding and knowledge to foster an inclusive culture
The council was proud to advance several key initiatives that align with these focus areas, including the following highlights:
- Diverse speakers delivered segments at internal Town Halls on a range of topics, including neurodiversity, Black History Month, Pride, Lunar New Year and Diwali.
- Elder Noel Milliea led an event to recognize the National Day for Truth and Reconciliation titled The Journey of Understanding: Unveiling Truth and Reconciliation. More than 150 participants joined virtually and in-person to delve into meaningful conversations as part of Atlantic Lottery’s ongoing journey toward truth, understanding and reconciliation.
- A virtual International Women’s Day event was attended by nearly 120 participants. In addition, staff submitted nominations to recognize 45 exceptional women within the organization.
- Neurodiversity Awareness Week was recognized with a campaign featuring resources, statistics and information about accommodations.
- Atlantic Lottery provided a 2SLGBTQIA+ Allyship Workshop for 50 attendees.
- Employees were encouraged to launch affinity groups as a subset of the IDEA Leadership Council to foster inclusivity, support and positive change within the workplace. Several groups have launched already, including the Indo-Canadian Affinity Group and Pride@AL.
“Being part of the IDEA Leadership Council matters to me personally. Having worked in different parts of the world, I have experienced various cultures and treatments. IDEA aligns with my core values of promoting understanding, reducing bias and fostering a sense of belonging for all individuals.”
Sree Venkatesh Iragavarapu,
Digital Product Manager
Regional Support
Through our Community Festival and Events Program, Atlantic Lottery supports more than 100 grassroots events that have important cultural, social and economic impacts across the region each year. In 2023-24, we reached community events in every corner of Atlantic Canada, supporting our commitment to build a stronger region by giving back to our communities.
We consider inclusion, diversity, equity and accessibility when selecting the events we choose to support and partner with. We were pleased to have the opportunity to support several new festivals and events in 2023-24 that reflect the diversity of our region, including:
- the River of Pride Festival and the Esgenoôpetitj Powwow in New Brunswick;
- the Festival Bluegrass Évangéline on Prince Edward Island; and
- the Harvesters’ Gathering event and North American Indigenous Games (NAIG) in Nova Scotia.
In addition to a $250,000 sponsorship for the NAIG, we supported the event through social media promotion and participation by Atlantic Lottery employees. A full list of all the events Atlantic Lottery sponsors is available online.
Atlantic Lottery was recognized at Afrifest in Halifax with the prestigious Afrifest Community Award in recognition of our long-standing partnership and support for the festival, dating back to 2017.
We are also proud to provide financial support to community initiatives through our Corporate Sponsorship Program. Atlantic Lottery donated $10,000 to the Wildfire Recovery Concert in Halifax, which raised funds for the United Way Halifax in support of Nova Scotians affected by wildfires in the summer of 2023. We also continued to support other United Way offices over the course of the year through activities such as payroll deductions and participation in annual Day of Caring events in our region.
Atlantic Lottery supports more than 100 grassroots events that have important cultural, social and economic impacts across the region each year.
Where the Money Goes:
91 cents of every dollar stays here
We are proud that 91 cents of every lottery dollar in 2023-24 stayed here in our region as part of our commitment to make a game-changing impact for the people and places of Atlantic Canada.
to Atlantic Canada
We returned $487 million in profit to the four Atlantic provinces in 2023-24, helping to fund services like health care, education and infrastructure. Since Atlantic Lottery was created, we have returned more than $12.3 billion to help fund the important services we all use.
Atlantic Canada
We recognized $447 million in prizes and had winners across Atlantic Canada – up more than $7 million from 2022-23. Since 1976, Atlantic Lottery has handed out more than $12 billion in prizes.
Atlantic Canada
Retailers received $125 million in commissions in 2023-24 – an increase of more than $3 million from the prior year. Our network of independent partners consists of more than 3,600 Atlantic Canadian businesses that earn income from the sale of Atlantic Lottery products and create employment in our communities.
Atlantic Canada
Atlantic Lottery is a significant driver of economic development, with our overall operations contributing indirectly to more than 8,300 jobs and $2 billion in economic activity across the region in 2023-24.
Atlantic Lottery employs more than 700 people in all four Atlantic provinces, who live, work, volunteer and spend their salaries in our communities.
As a business, Atlantic Lottery pays taxes to the government. This results in further support for essential services that benefit Atlantic Canadians and our communities.
Atlantic Lottery sometimes partners with companies outside of the region, depending on the needs and the availability of third parties and the services they provide.
Breaking Down the Lottery Dollar
Winners
In 2023-24, 1,074 prizes of $10,000 or more were paid out to Atlantic Canadians. That’s an increase from 893 major winners the previous year.
Major wins ($10,000 or more) by province
New Brunswick
410
Newfoundland and Labrador
287
Nova Scotia
334
Prince Edward Island
43
Balanced Scorecard
2023-24 Corporate Performance to Targets
Atlantic Lottery’s balanced scorecard presents, measures and reports on specific corporate metrics that have been identified as key to realizing the operating plan and long- term strategic plan. Each year, the scorecard is established by Atlantic Lottery’s management team and approved by the Board of Directors. Its measures are essential to ensuring Atlantic Lottery continues to adapt to and excel within its evolving competitive environment.
| Measure | Actual | Target |
|---|---|---|
| Financial | ||
| Gross Operating Revenue1 | $872.7M | $867.7M |
| Net Profit | $487M | $500M |
| Player | ||
| Known Players2 | 362,180 | 367,108 |
| Usage of Online Discretionary Healthy Play Tools3 | 77,473 | 42,000 |
| Operational | ||
| Operational Efficiency | $3.7M | $2.0M |
| Unfavourable Opinion Among Involved Atlantic Canadians4 | 27% | 26.5% |
| Learning and Growth | ||
| Employee Engagement | 73% | 78% |
1 Revenue less prizes paid to players and sales discounts.
2 Total number of verified unique accounts that have been active on alc.ca or have entered retail tickets via 2Chance in the previous 12 months.
3 This target measures the number of alc.ca players who have set up a wager limit or a session limit on alc.ca or the mobile app. This is measured as a count and represents a sum of total usage of both these tools.
4 This reflects the sentiment Involved Atlantic Canadians share toward Atlantic Lottery’s products. A lower percentage indicates a more positive sentiment.
Financial Position Overview
The following provides an overview of the financial position of Atlantic Lottery for the year ended March 31, 2024, and is to be read in conjunction with the associated audited consolidated financial statements and note disclosures, which are prepared in accordance with International Financial Reporting Standards (IFRS). Refer to notes in the Consolidated Financial Statements (notes 1, 2 and 3) for additional detail regarding the nature of operations for Atlantic Lottery, the basis of presentation and the relevant accounting policies employed.
Atlantic Lottery remains committed to increasing the profit we return to our four provincial shareholders while offering responsible products and resources to our players. As seen through the 2023-24 balance sheet performance, we continue to support our retail partners, fund new investments through innovative product offerings and preserve a healthy pension plan to support past, present and future employees. At the same time, we continue to maintain a strong cash flow, which is detailed in the Statement of Cash Flows.
In 2023-24, Atlantic Lottery continued to make capital investments in support of new product offerings to ensure a strong position for future success and to strengthen our market share in the face of an increasingly competitive industry. These investing decisions are in line with our strategy to prioritize projects and ensure responsible cash management policies.
The accounts receivable balance increased significantly due to the timing of the $64-million Lotto 6/49 Gold Ball Jackpot prize that was claimed in New Brunswick in late March 2024. This also resulted in a significant increase in accounts payable. Gold Ball prizes are funded by the Interprovincial Lottery Corporation and this win was settled early in the next year. Assets were further impacted by continued capital investment, including the purchase of new lottery retail terminals and new video lottery terminals. Atlantic Lottery obtained new long-term debt in 2023-24 to cover the prior year’s capital assets, which were previously financed through short-term debt.
Consolidated Balance Sheet (thousands of dollars)
| 2023-24 | 2022-23 | Variance | ||
|---|---|---|---|---|
| $ | % | |||
| Total Assets | $407,290 | $333,858 | $73,432 | 22% |
| Total Liabilities | $285,938 | $215,234 | $70,704 | 33% |
| Total Shareholders’ Equity | $121,352 | $118,624 | 2,728 | 2% |
Financial Position Overview
Change in assets (thousands of dollars)
Change in Liabilities and Shareholders’ Equity (thousands of dollars)
Financial Position Overview
Revenue consists of gross sales less consideration paid to the player (prize expense and sales discount). The year-over-year increase in revenue is driven by increasing performance across the iLottery and Destination lines of business. The most significant increase of $24.7 million in the iLottery line of business was driven by the strong performance in the Casino brand, which was launched in Newfoundland and Labrador in 2023-24, and marked its first full year of operations in Nova Scotia. The increase in Destination revenue of $5 million is driven by strong results as the Video Lottery brand continues to rebound from the results experienced during the COVID-19 pandemic.
Direct expenses include commissions paid to retailers of $125 million, up $3.3 million or three per cent from the prior year. The increase is tied directly to the higher revenue – specifically video lottery revenue – as the commission on that product is higher than products in the retail channel. Ticket and selling costs of $34.2 million represent a $5.9-million increase over the prior year, driven by the revenue share on iGames as performance continues to grow.
Operating and other expenses are up by $24.8 million compared with 2022-23. Atlantic Lottery has delivered on our 2023-24 business plan, which included incremental operating costs to ensure appropriate investment in strategic priorities. These priorities include investing in employees to ensure appropriate resources and technical abilities to support operations and upcoming projects; increasing the focus on marketing to support the growing iLottery line of business; and providing players with a safe and fun experience through a wide range of product offerings. In addition, increases in Bank of Canada rates during the year, combined with the capital investments financed with long-term debt, resulted in increased interest expense.
Consolidated Statement of Operations
| (Thousands of dollars) | 2023-24 | 2022-23 | Variance |
|---|---|---|---|
| Revenue | 872,680 | 843,901 | 28,779 |
| Direct Expenses | 159,178 | 150,025 | 9,153 |
| Gross Profit | 713,502 | 693,876 | 19,626 |
| Operating Expenses | 226,474 | 201,627 | 24,847 |
| Net Profit | 487,028* | 492,249* | -5,221 |
| Gross Profit % of Revenue | 81.8% | 82.2% | -0.4% |
| Operating Expenses % of Revenue | 26.0% | 23.9% | 2.1% |
| Net Profit % of Revenue | 55.8% | 58.3% | -2.5% |
*Consolidated Net Profit includes gain from subsidiary of $0.1M
Profit by Province (in millions)
Profit by Line of Business (in millions)
Consolidated Statement of Cash Flows
The statement of cash flows provides the basis to assess the generation and spending of cash.
Operating activities present the net of cash inflows and outflows from regular business activities. The strong net profit results are adjusted for non-cash items such as depreciation and amortization and non-cash working capital. The result is a total of $526.9 million generated in cash flow from regular business activities.
Investing activities represent the amount spent on property, equipment and intangible assets. During 2023-24, Atlantic Lottery purchased several capital assets required for the organization’s continued success. Significant investment areas included the purchase of new lottery retail terminals planned to be rolled out in 2024-25, new video lottery terminals and software, renovations at Red Shores, and technology and hardware required to support Atlantic Lottery operations.
Financing activities reflect cash inflows and outflows related to debt. Atlantic Lottery obtained new long-term debt to fund capital purchases from 2022-23, resulting in a decrease in the line of credit and short-term financing.
Overall, the net change for cash in 2023-24 is an increase of $2.5 million. Cash flows continue to be very positive, with liquidity risk managed through forecasting and assessing cash flow requirements on an ongoing basis.
| (Thousands of dollars) | 2023-24 | 2022-23 |
|---|---|---|
| Operating Activities | 526,934 | 505,013 |
| Investing Activities | (35,068) | (47,729) |
| Financing Activities | 2,471 | 35,415 |
| Distribution to Shareholders | (491,830) | (498,880) |
| Change in Cash Balance | 2,507 | (6,181) |
| Opening Cash Balance | 9,412 | 15,593 |
| Closing Cash Balance | 11,919 | 9,412 |
*Cash flows presented using the indirect method.
Business Overview:
Draw Games
The draws category delivered net revenue of $173.9 million in 2023-24, a decrease of $7.7 million or 4.3 per cent compared with the prior year.
In 2023-24, Lotto 6/49 net revenue finished the year at $43.8 million, an increase of $5 million over 2022-23. The year-over-year growth was primarily driven by the completion of the first full year in-market for Lotto 6/49’s game enhancements. In addition, Lotto 6/49 experienced a favourable roll pattern, with a total aggregate jackpot increase of 71 per cent, including the Gold Ball jackpot reaching the $68-million level, which was not anticipated. Lotto 6/49 offered seven Super Draw events, leading to a blended sales lift of 18.2 per cent. Lotto 6/49 had a 22.9 per cent share of sales on alc.ca, which was higher than the budgeted share of 22.3 per cent.
Net revenue for Lotto Max reached $59.4 million in 2023-24, a decline of $11.7 million from the prior year’s net revenue. Total sales fell below budgeted levels and declined from 2022-23 totals due to an unfavourable roll pattern where jackpots were often won before reaching higher levels, inhibiting the sales growth that typically follows large prize amounts.
Draw Games Net Revenue
Draw Games Net Revenue (rounded in millions)
Business Overview:
Instant Games
Scratch ‘N Win net revenue was $85.4 million in 2023-24, an increase of $6 million or 7.6 per cent compared to the results from the prior year.
The main driver of growth was the launch of MEGA 360 in October 2023. This new $5 scratch ticket includes instant cash prizes ranging from $5 to $100,000, or a new spin prize that is a guaranteed win from $10 to $10,000 revealed at retail or on the mobile app. If the animated wheel lands on “MEGA 360,” players have the chance to spin the MEGA 360 Wheel at the Atlantic Lottery head office for a guaranteed prize ranging from $100,000 to $500,000. This innovative game is the first game of its kind in the Atlantic Lottery market, uniquely incorporating three key elements – scratch, watch and spin. MEGA 360 achieved net revenue in 2023-24 of $7.1 million, outperforming its budget by $4.7 million.
The net revenue target for the busy month of December was $8.8 million, and actual results were $9.3 million – an all-time monthly revenue record for the Scratch ‘N Win category. Scratch ‘N Win did experience softer results in other games, such as Set for Life, which brought in $8.5 million and was $500,000 under budget, and Crossword, which was $1.8 million under budget at a total of $22.5 million in revenue. Overall, Scratch ‘N Win achieved a record sales year, surpassing the previous record set in 2021-22 of $81.7 million.
Breakopen net revenue was $37.7 million in 2023-24, an increase of $300,000 or 0.8 per cent compared with the prior year. Breakopen sales have stabilized following significant impacts during 2020-21, including the COVID-19 pandemic and the reimplementation of barcoded Breakopen. Year-over-year performance was consistent across provinces, with revenue driven by $1 Flaming 7s, which represented $12.2 million or 32.4 per cent of the total category net revenue.
Scratch’N Win Net Revenue (rounded in millions)
Breakopen Net Revenue (rounded in millions)
Business Overview:
iGames
Net revenue from iGames reached $126.2 million in 2023-24, a growth of $26.1 million or 26 per cent over the previous year.
The success of iGaming is largely due to the expansion of the Casino portfolio, iSlots and iTable Games combined, with a regular cadence of new games launched, supported with marketing tactics. Atlantic Lottery experienced an 8.7 per cent rate of reallocation of player spending from Digital Instants due to the launch of Casino in Newfoundland and Labrador and the launch of an awareness campaign in Nova Scotia. Casino experienced an increase of 90 per cent, helping to ensure overall growth in the iGames category.
iGames Net Revenue (rounded in millions)
Business Overview:
Sports
In 2023-24, net revenue in the Sports category was $14.8 million, resulting in a decrease of $2.3 million or 13.4 per cent from the prior year.
Despite the decrease in net revenue, the PRO•LINE brand saw positive results overall. Online results experienced year-over-year growth in sales, with an increase of 15 per cent and active accounts, which saw an increase of five per cent. Digital revenue, which includes the sum of online and QR code purchases, made up 77 per cent of all sports-betting sales, a reflection of the growing preference for a digital experience across all wagering channels.
Net revenues were negatively impacted by a national trend of elevated prize expense levels, as well as a modest shift in players spending more online than in bricks and mortar locations. Retail sales, which typically produce higher profit margins than online, were down three per cent. Overall, these results demonstrate strong brand health at a time of increasingly aggressive competition from illegal online betting sites.
Sports Games Net Revenue (rounded in millions)
Business Overview:
Video Lottery
Video Lottery net revenue in 2023-24 was $406.9 million, an increase of $5.1 million or 1.3 per cent compared to the prior year.
In 2023-24, sales continued to stabilize back to pre-COVID-19 pandemic levels. Overall performance was driven by an increase in play of one per cent compared to 2022-23. All provinces experienced year-over-year growth, except Prince Edward Island, which remained consistent with 2022-23 levels. Strong performance in Newfoundland and Labrador contributed $2.1 million, while New Brunswick and Nova Scotia exceeded the prior year by $1.7 million and $1.4 million respectively. Compared to the 2023-24 budget, Newfoundland and Labrador led the other provinces, out-performing by $3.8 million. New Brunswick and Nova Scotia were under budget by $2.3 million and $1.1 million respectively.
Video Lottery Net Revenue by Province (rounded in millions)
Business Overview:
Red Shores
Red Shores’ net revenue was $23.3 million in 2023-24, an increase of $1.3 million or 5.8 per cent over the prior year.
Business and tourism continued to grow in 2023-24 as Prince Edward Island rebounded from pandemic impacts. This was the first year since 2018-19 that was not impacted by COVID-19 or any major weather events such as hurricanes. Guest counts were continuously up over the course of the year. Park After Dark events were quite successful, including the inaugural Hoedown Live, which was attended by more than 700 people and will be scheduled again in 2024-25. Old Home Week sales broke previous records in all areas – particularly in dining and beverage sales.
Red Shores Net Revenue by Category (rounded in millions)
Financial Highlights – Provincial Net Profit ($ in ‘000s)
| Provincial Net Profit* | ||||||||
| New Brunswick | Newfoundland & Labrador | Nova Scotia | Prince Edward Island | |||||
| 2024 | 2023 | 2024 | 2023 | 2024 | 2023 | 2024 | 2023 | |
| Net retail and iLottery revenue | 127,117 | 121,957 | 140,737 | 135,420 | 146,156 | 134,965 | 24,295 | 23,628 |
| Prizes as % of sales | 49% | 49% | 51% | 53% | 50% | 52% | 54% | 54% |
| Net video lottery revenue | 133,067 | 131,451 | 124,659 | 122,526 | 130,114 | 128,677 | 23,257 | 23,281 |
| Net Red Shores revenue | - | - | - | - | - | - | 23,278 | 21,996 |
| Net Revenue | 260,184 | 253,408 | 265,396 | 257,946 | 276,270 | 263,642 | 70,830 | 68,905 |
| Direct Expenses | 47,159 | 43,134 | 55,316 | 53,200 | 46,354 | 43,861 | 10,349 | 9,830 |
| Gross Profit | 213,025 | 210,274 | 210,080 | 204,746 | 229,916 | 219,781 | 60,481 | 59,075 |
| Gross profit as % of net revenue | 82% | 83% | 79% | 79% | 83% | 83% | 85% | 86% |
| Operating and administrative expenses | 36,262 | 32,399 | 35,945 | 31,863 | 39,770 | 34,213 | 24,534 | 21,252 |
| Operating expenses as % of net revenue | 14% | 13% | 14% | 12% | 14% | 13% | 35% | 31% |
| Capital-related costs | 7,354 | 7,357 | 7,839 | 6,786 | 9,381 | 8,400 | 3,472 | 3,335 |
| Other expenses and distributions | 18,203 | 16,627 | 18,994 | 17,521 | 19,111 | 16,706 | 5,630 | 5,184 |
| Net profit | 151,206 | 153,891 | 147,302 | 148,576 | 161,654 | 160,462 | 26,845 | 29,304 |
| Net profits as % of net revenue | 58% | 61% | 56% | 58% | 59% | 61% | 38% | 43% |
| Number of lottery retail terminals | 834 | 827 | 843 | 847 | 968 | 959 | 148 | 150 |
| Number of video lottery terminals | 1,749 | 1,722 | 1,771 | 1,812 | 1,9691 | 1,9751 | 302 | 300 |
| Profit distribution per capita2 | $222 | $243 | $329 | $352 | $185 | $202 | $190 | $237 |
1 Does not include First Nations sites
2 Includes Atlantic Canadians aged 19+ only
* Provincial Net Profit is based on Atlantic Lottery's non-consolidated financial statements
* Figures are rounded
Financial Highlights – Corporate Net Profit ($ in ‘000s)
| Corporate Net Profit * | |||||
| 2024 | 2023 | 2022 | 2021 | 2020 | |
| Net retail and iLottery revenue | 438,304 | 415,970 | 392,355 | 330,754 | 304,846 |
| Prizes as % of sales | 51% | 51% | 53% | 54% | 57% |
| Net video lottery revenue | 411,098 | 405,935 | 343,890 | 292,828 | 397,581 |
| Net Red Shores revenue | 23,278 | 21,996 | 17,609 | 12,021 | 18,688 |
| Net Revenue | 872,680 | 843,901 | 753,854 | 635,603 | 721,115 |
| Direct Expenses | 159,178 | 150,025 | 134,613 | 111,995 | 134,450 |
| Gross Profit | 713,502 | 693,876 | 619,241 | 523,608 | 586,665 |
| Gross profit as % of net revenue | 82% | 82% | 82% | 82% | 81% |
| Operating and administrative expenses | 136,420 | 119,639 | 104,275 | 101,328 | 108,793 |
| Capital-related costs | 27,789 | 25,491 | 26,091 | 31,065 | 33,693 |
| Other expenses and distributions | 62,265 | 56,497 | 50,734 | 44,671 | 48,752 |
| Net profit | 487,028 | 492,249 | 438,141 | 346,544 | 395,427 |
| Net profits as % of net revenue | 56% | 58% | 58% | 55% | 55% |
| Number of lottery retail terminals | 2,793 | 2,783 | 2,796 | 2,827 | 2,896 |
| Number of video lottery terminals | 5,791 1 | 5,809 1 | 5,848 1 | 5,998 1 | 6,301 1 |
1 Does not include Nova Scotia First Nations sites
* Corporate Net Profit is based on Atlantic Lottery's consolidated financial statements
* Figures are rounded