Loto-Québec posted a drop in its revenues and profits in the first quarter, but maintained its growth objective for the current financial year.
The state-owned company’s net profit was $349.7 million for the months of April, May and June, down 8.2% compared to the same period last year. Total revenues for the quarter were down 3% to $689.7 million.
The fact that the quarter had two fewer days than the previous year partly explains this decline in performance, according to its president and CEO Jean-François Bergeron, who also acknowledges that Loto-Québec is feeling the impact of the decline in consumers’ purchasing power.
“The pressure on the discretionary dollar is being felt,” he said in an interview with The Press.
Of the company’s three business segments, lotteries, casinos and gaming establishments, gaming establishments are showing the largest decline in revenue. “Gaming establishments are following the curve of restaurants, and we know that restaurants are in a difficult situation,” explains the CEO.
Despite this poor performance in the first quarter, Loto-Québec is maintaining its forecast for an increase in its net income for 2024-2025, which should be slightly up compared to the previous year. Last year, the Crown corporation collected a net income of $1.5 billion. This amount was almost entirely paid in dividends to the Quebec government, making it the second largest contributor to the public treasury among Crown corporations, behind Hydro-Québec and ahead of the Société des alcools.
Loto-Québec believes there is still room to improve its gaming offering and increase its revenues and profitability, while continuing to compete with illegal gaming operators. “There is a market that we are not capturing,” says the CEO, who was previously at the head of the SQDC.
For the current fiscal year, the construction of a 200-room hotel on the site of the Montreal casino is Loto-Québec’s main project. “It’s progressing well,” said Jean-François Bergeron, regarding this investment estimated at $150 million.
The name of the hotelier and the banner should be known soon, following the call for tenders by invitation launched by Loto-Québec, the response rate of which was in line with the organization’s expectations, according to its CEO.