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Ontario Lottery Falls Short Of Earnings Estimates
ONTARIO LOTTERY AND GAMING FALLS SHORT IN ITS REVENUE ESTIMATES
Performance nowhere near the Cdn$1.26 billion forecast for 2017-2018.
The Ontario Lottery and Gaming Corporation has acknowledged its failure to meet forecasts of revenue around Cdn$1.26 billion by 2017-2018.
It has been repeatedly required to downgrade its projections for revenue growth after cities rejected its push for new land casinos; its online gambling platform failed to perform to expectations; and it abandoned plans for privatizing lottery operations.
The Canadian province's Auditor General, Bonnie Lysyk, said this week that the corporation's profit forecasts 'should have been more realistic'.
Much of the OLG's expansion plan is so far behind its original timeline that the agency has deferred its expected revenue gains by four years, according to local media reports.
OLG spokesman Rui Brum blamed the discrepancy on the size and complexity of the transformation project, saying it was ambitious and had evolved since its launch.
He revealed that the corporation is now projecting its reforms will add an extra Cdn$889 million annually to government coffers by 2021-22....a 30 percent decrease and a four-year delay from its original projections.
In 2015-16, OLG provided Cdn$2.2 billion to government coffers, making it Ontario's biggest source of non-tax revenue, but that was about Cdn$500 million short of the forecast presented when it launched its modernization plan four years ago.
According to the Auditor General the failure to meet expectations was caused by:
* OLG's original predictions of $100 million in annual profit from internet gambling were too optimistic. In 2015-16, the figure was just Cdn$15 million. OLG projects that will rise to $25 million, but the Auditor General says this may be "overstated".
* Plans to build several new land casinos have become bogged down by local opposition in the selected cities.
* The corporation failed to progress a privatization program on lottery operations, and has since abandoned the idea. However, it still projects gaining an extra Cdn$209 million a year from unspecified lottery reforms.
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