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.
