I have a bad vibe from betr, seems they’re taking a bath and no...

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Tramrich

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14/07/23

14:28

Post #: 68791763
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Originally posted by Brett M H: ↑

Morning everyone!!

I think you will find that BET has already booked the smaller establishment & development fees in the recent 4C Quarterly reports.

But I am not expecting the larger fees from BETR to be paid in this quarter (Q4FY23 - April to June 2023) as BETR didn't launch until Sept / Oct 2022 from memory - so I think these larger amounts will be paid either next quarter (Q1FY24) or more likely be paid the following quarter (Q2FY24)

I suspect (like others) that the "annual $7.5m Development & Service Fee" and the expected to be large "revenue sharing annual fee" from BETR would probably be paid at the same time.

However I am definitely still expecting this Q4FY23 BET quarterly to show a big improvement towards the business being cash flow positive

Below is the key terms from the original "BET deal with BETR" announcement:

Key financial terms include:

Platform Establishment Fee of $2 million and a Launch Development Fee of $500,000 per month between signing and the go live date. BET management expects the go-live date will occur within six months;

Development & Service Fee of a minimum $7.5 million per annum commencing on the go live date and increasing by CPI on each anniversary of the go-live date, representing a minimum base fee of $75 million over the 10-year contract (before CPI increases);

Annual Fee based on a revenue sharing arrangement starting at 25% of ongoing net gaming revenue, reducing by 1% on each anniversary of the go live date during the 10-year contract as the business scales, less the annual Development & Service Fee;

Annual Fee is subject to a maximum cap of $20 million per annum initially, growing at +10% per annum for 8 years following the go live date and +5% per annum thereafter to $43 million at the end of the 10-year period.
This equates to a total maximum revenue possible over 10 years after the go live date of ~$313 million, plus the Launch Development and Platform Establishment Fees.

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I have a bad vibe from betr, seems they’re taking a bath and no one wants to chuck any more money at it. Will be interesting to watch how it plays out it, looks like betr will test Tripp’s
skills…
BET Price at posting: 16.5¢ Sentiment: Hold Disclosure: Held
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