FINANCIAL REPORT - Française des Jeux

16 — 2010 FINANCIAL REPORT
These offers also benefi ted from regulatory changes authorising
the increase in the prize payout to players. Finally, the football
World Cup, a major sporting event, was a resounding success.
4.1.2. Distribution of player stake
The €10,551.4m in player stake were distributed between
players, the hedging of counterparty risk, French public fi nance
and la Française des Jeux.
The amount paid out to players was €6,788.9m. This fi gure was
up by 7.6% over 2009, mainly due to the increase in prize payout
to players on sports betting, both in the brick-and-mortar network
as well as online.
Legislative changes authorised the increase in the maximum payout
from an average of 75% to 85% and as a result, the rate of
redistribution to players rose from 63.1% to 64.3%.
Allocation to counterparty funds, net of counterparty spreads,
totalled €76.1m and represented 0.7% of player stake in 2010
compared to 0.4% in 2009. These funds are intended to hedge
the counterparty risk of certain games, i.e. the risk that the total
prize amount actually distributed to winners is higher than the share
of player stake set aside for this purpose, in accordance with the
requirements of the Budget Minister’s decree. The increase in net
provisions is linked to the rise in player stake and changes in
counterparty spreads.
Government levies on player stake (including VAT on gaming
revenue, tax on winnings and rounding of winnings, excluding the
permanent fund surplus) totalled €2,516.0m, down 0.6% compared
with 2009. These represented 23.8% of player stake, against 25.3%
in 2009, a decline attributed to the increase in prize payouts to
players.
Gaming revenue corresponds to commissions paid to la Française
des Jeux and its distribution network, which totalled €1,170.4m, or
11.1% of player stake, unchanged compared to 2009.
4.1.3. Other revenue and other operating income
Other revenue, mainly composed of rentals of point-of-sale
(POS) terminals and equipment to retailers, totalled €25.4m, up
3.9% compared to 2009 due to the increase in the number of
real-time points of sale.
Revenue from ordinary activities, composed of gaming
revenue and other revenue, amou nted to €1,195.8m, against
€1,138.4m in 2009.
Other operating income consists primarily of unclaimed prizes
on scratch games (+ €7.2m) and capitalised production (+ €2.8m).
Operating income amounted to €1,256.1m, up 5.5% compared
to 2009.
4.1.4. Operating expenses
Operating expenses came to €1,131.2m, versus €1,072.4m in
2009 and are broken down as follows:
In millions of euros 2010 20092010/2009 change
External purchases and
expenses
of which distribution
network costs
963.9915.648.35.3%
639.9609.330.65.0%
Taxes and duties 11.815.1- 3.4- 22.3%
Personnel expenses 84.578.46.17.8%
Allowances for
depreciation and
provisions
58.355.42.95.2%
Other expenses 12.87.85.064.0%
Total operating
expenses
1,131.21,072.458.85.5%
External purchases and expenses represent 85.2% of
operating expenses in 2010. These mainly include the distribution
network costs of la Française des Jeux in the amount of €639.9m,
up 5% compared to 2009.
Excluding distribution network costs, external purchases and
expenses came to €324m, a 5.8% increase. These mainly relate to:
– expenditure on advertising and sponsoring (32.4%)
– general subcontracting (17.9%)
– maintenance (15.2%), based on the number of points of sale and
the equipment installed
– postage, telephone and leased lines (7.2%), unchanged from 2009
– fees (5.7%), which were higher in 2009 because of work done
ahead of the opening up of the market;
– studies and research (5.5%), particularly relating to the internal
organisation, the management of risks and security, and the new
corporate website.
The change in taxes and duties (-€4m) is mainly due to the
elimination of the business tax (taxe professionnelle) , which was
replaced by the “regional economic contribution” (contribution
économique territoriale).
The increase in personnel expenses is mainly due to the increase
in the weighted average headcount, from 985 in 2009 to 1,040 in
2010.
The increase of €2.9 million in depreciation and provisions is
mainly due to the rise in capital expenditure.
Other expenses primarily consist of royalties, copyrights and
reproduction rights. These expenses, which rose by €4.1m in 2010,
are mainly related to partnerships with sport organisations and the
team of sport experts.