PointsBet Holdings Limited (PBH) Earnings Call Transcript & Summary

Thank you for standing by, and welcome to the PointsBet Holdings Limited H1 FY '21 Financial Results. [Operator Instructions] I would now like to hand the conference over to Mr. Sam Swanell, Group CEO. Please go ahead.

Good morning. I would like to thank you for joining this call for the PointsBet Holdings Limited Half Year 2021 Results. This is Sam Swanell, Group CEO, and I'm joined today by U.S. CEO, Johnny Aitken, who's joining us from Denver; and Group CFO, Andrew Mellor. Today, we will talk to our investor presentation, which was lodged with the ASX this morning, together with our half year financial report. All figures in this presentation are in Australian dollars unless otherwise stated. Turning to Slide 4. The H1 FY '21 performance of the global trading businesses, as compared to the prior corresponding period of H1 FY '20 to be referred to as the PCP, was as follows: turnover was up 255% at $1.89 billion; gross win was up 225% at $154 million; net win was up 177% at $83 million; and active clients were up 107% at 211,000. H1 FY '21 saw the announcement of our transformational 5-year media partnership with NBCUniversal. This has provided PointsBet with deep access and integration into NBCUniversal's world-leading broadcast and digital assets. NBCUniversal is one of the most iconic and trusted media brands in the United States, with the largest sports audience of any U.S. media company accessing over 184 million viewers. As noted by our Chief Commercial Officer, Eric Foote, at the December quarterly update, we could not be more pleased with the execution and progress we have made to date under this partnership. Both teams are aligned to the opportunities ahead and are working at a feverish pace to unlock value and execute on PointsBet's marketing strategy. As I've spoken to in the past, as the company looks to grow its business across the United States and utilizes its deep sports wagering experience to risk manage those clients whose average bet size is significantly above the median, volatility of revenues across reporting periods can occur. Slide 5 addresses this volatility across reporting periods by showing the company's full year trading performance to 24 January, 2021. The global business had a strong start to Q3 FY '21. For the period 1st of January to 24 January, the global business achieved a net win of $22.9 million. The United States has reversed the aggregate H1 FY '21 negative net win of $2 million to record an FY '21 year-to-date net win to 24 January of $11.7 million. The Australian Trading business recorded FY '21 year-to-date net win to 24 January of $94 million. As can be seen on Slide 6, in Australia, active clients were up 77% compared to the 12 months to 31 December, 2019. The company recognizes a structural change in the Australian online wagering market, including brand consolidation and a shift from retail to online wagering. As the company seeks to grow its net win market share in 2021, the Australian Trading business marketing expense was $21.1 million in H1 FY '21. PointsBet's investment in U.S. marketing expense during H1 FY '21 of USD 30.3 million resulted in U.S. active clients during the 12 months to 31 December increasing by 222% to over 68,000 compared to the 12 months to 31 December, 2019. In the U.S. in H1, PointsBet resumed its targeted marketing investment in New Jersey, Indiana and Illinois, assisted by the NBC Sports media assets and launched operations, including targeted marketing investment, in Colorado in November 2020. PointsBet continued not -- to not make any significant marketing investment in Iowa during H1. However, increased targeted marketing spend in that state from 1st of January, 2021 when in-person registration was replaced by online registration. Now turning to Slide 7. Australian Trading business recorded net win of $84.8 million, up 211% from the PCP. Net win margin of 7.9% increased from 7.8% in the PCP. H1 saw an increase in the percentage of Australian turnover that was bet on the higher-margin multi-segment compared to the prior corresponding period. The launch of Same Game Multi for NFL and NBA in September and December, respectively, further contributed to higher overall margins. March '21 will see the company's third anniversary since the launch of a full product suite in Australia. Pleasantly, H1 FY '21 marketing spend of $21.1 million assisted in delivering H1 FY '21 net win of $84.8 million, a marketing expense to net win ratio of 25%. H1 FY '21 turnover of $1.07 billion tripled compared to H1 FY '20, up 207%. I'm very pleased to report that the Australian Trading business recorded a statutory EBITDA for the half of $8 million compared to a loss of $3.4 million in the PCP. I would now like to make some comments on our H2 marketing strategy in Australia. Given the previously announced appointment of Shaquille O'Neal as our Australian brand ambassador, the company intends to increase its H2 marketing expense above the $21.1 million spent in H1 to leverage Shaq's brand appeal in the Australian market. However, to be clear, as a result of the strong H1 performance of the Australian business, it is not anticipated that the Australian Trading business will require any group funding for the 2021 financial year. The performance of the Australian Trading business is an excellent blueprint for our aspirations in the United States. Our ability to operate a growing, profitable business in the advanced and competitive Australian market, backed by continually improving product and growing brand recognition, provides confidence in the continued execution of our U.S. strategy. I will now hand over to Johnny Aitken, U.S. CEO, to speak to the U.S. results.

Thank you, Sam. Now turning to Slide 8. The U.S. business achieved a gross win of $17.7 million compared to a gross win of $9.2 million in the PCP with a net win loss of $2 million compared to a net win of $2.6 million for the PCP. As Sam noted earlier, due to the nature of the sports betting industry, volatility of revenues across reporting periods can occur. This is evidenced by the United States business strong start to H2 FY '21, reversing the aggregate H1 FY '21 negative net win of $2 million to record an FY '21 year-to-date net win to 24 January of $11.7 million. Given the full-scale resumption of the major U.S. sports leagues and PointsBet's investment in marketing during H1 FY '21 of USD 30.3 million, the U.S. business saw active clients during the 12 months to 31 December, 2020 increase by 222% to just over 68,000 compared to the PCP. PointsBet is now operational in New Jersey, Iowa, Indiana, Illinois, Colorado and Michigan. Michigan will also see the inaugural launch of PointsBet's iGaming product in H2 FY '21, followed by New Jersey. The negative H1 net revenue performance clearly has had a negative impact on the overall U.S. EBITDA performance. Together with the substantial U.S. marketing expense during the half and continued investment in the U.S. sports wagering opportunity, this led to the U.S. trading segment recording on a statutory basis an EBITDA loss of $69.2 million in the reporting period. Turning to Slide 9. I will now briefly touch on each state. New Jersey. PointsBet achieved 10.8% market share in New Jersey for online handle during the half on the back of increased activity from clients whose average bet size is significantly above the median. The company continues to target a long-term market share of 10%. New Jersey recorded a gross win of $4.2 million at a gross win margin of 0.7% and a net win loss of $3.8 million at a net win margin of negative 0.6%. As noted in the trading update, results in H1 FY '21 have corrected from this short-term variance, resulting in a year-to-date to 24 January, 2021 for a positive net win in the state. Illinois. In Illinois, PointsBet achieved 8.9% market share for online handle in Q2 FY '21. Whilst we are very pleased with this result, PointsBet acknowledges that December's online market share of 6.55% is more indicative of our market share performance as during the early part of Q2, the company risk-managed clients whose average bet size is significantly above the median. Illinois recorded a gross win of $9.3 million at a gross win margin of 5.7% and a net win of $2.9 million at a net win margin of 1.7%. Illinois remains a remote registration environment due to the emergency order extending remote registration. We also note the recent introduction of draft iGaming legislation in Illinois. This follows the recent trend of iGaming legislation being considered in states soon after legalized sports betting. Indiana. In Indiana, PointsBet achieved 3.8% market share for online handle during the half, ranking as the fourth-largest operator by handle in December. Indiana recorded gross win of $2.9 million at a gross win margin of 6.0% and a net win loss of $1.5 million at a net win margin of negative 3.1%. Given the early stage of this competitive state, the company continued to focus on acquiring and retaining clients, which resulted in promotions exceeding gross win. Details of the company performance in the recently launched Colorado and in-person registration jurisdiction in Iowa are set out in the HY report released to the ASX this morning. I would briefly like to expand on some of the points Sam made previously as it relates to short-term variances of gross win margins across reporting periods. It is important to note that we take a long-term approach to the management of our clients. In relation to higher-staking clients, while the average bet size is significantly above the median, their behavior over the medium to long term will result in positive value. And as such, while we may see short-term volatility of gross win across reporting periods, we're confident as to the profitability over the long to -- over the medium to long term. Our confidence to manage these clients comes from decades of risk management experience of our trading teams. I would like to make some comments also on the recent Super Bowl performance, which was strong across all areas. Firstly, we were delighted with how our systems performed, noting that some of our key competitors experienced technical issues and delays. No major outages or system issues were reported in the lead-up or during the game, with 99.9% of all bets placed within 1 second as per our service targets. PointsBet also offers the most markets in the world on the Super Bowl. As an example, 15 minutes before kickoff, PointsBet were offering 765 markets, over 200 more than the closest competitor. Our depth and breadth of product is a testament to our platform capabilities and the expertise of our internal trading teams. We also saw significant year-on-year growth across the key Super Bowl metrics. Examples include: handle, up 4x year-on-year; acquisition, up 12x year-on-year, with Super Bowl Day achieving a new record for client acquisition, up more than 200% on the previous best acquisition day; and finally, we delivered a strong trading margin result to cap off a great day. I will now hand over to our group CFO, Andrew Mellor, to run through the detail of our results.

Thank you, Johnny. Now turning to the company's reported results on Slide 12. I will be talking to our normalized results today. However, there is a reconciliation from the statutory results included in the review of operations and also on Slide 17 of this presentation. As a reminder, net revenue in Australia is net win less GST. Net revenue in the U.S. is equal to net win. For the reporting period, PointsBet reported net revenue of $75.1 million, a growth of 174% versus the PCP. Gross profit of $25.6 million represented growth of 109% over the PCP. As Sam referenced earlier, the negative H1 net revenue performance in the U.S. business as a result of the short-term variances across reporting period did have a negative impact on the overall group gross profit performance. However, it was pleasing to see the positive start to Q3 in the U.S. Australian gross profit margins have remained consistent on a PCP basis. The group sales and marketing expense was $62.9 million for the half, as was previously disclosed in both our Q1 and Q2 results presentations. Australia accounted for $21.1 million, and the U.S. accounted for $41.8 million. This increased marketing investment assisted in the delivery of 143,000 active clients in Australia and 68,000 active clients in the U.S. at the 31st of December, 2020. Employee benefits expense increased over the reporting period in both Australia and the U.S. The focus on hiring in Australia was predominantly in the product and technology department. While in the U.S., hires were spread across all operations. Specifically, FTEs as at the 31st of December, 2020 grew to 303, up 54% from 30 June, 2020. Product and technology expenses increased over the reporting period. During H1 FY '21, the company was operational in Australia and 5 U.S. states, being New Jersey, Iowa, Indiana, Illinois and Colorado. And as a result, our betting volumes have increased. Our cost associated with developing, hosting, operating and securing our technology and data platforms have also increased. Thus, the normalized EBITDA loss -- sorry, the normalized group EBITDA loss was $69 million as the business continued to invest in the U.S. sports wagering opportunity. The statutory group EBITDA loss was $71.3 million for the reporting period. Turning to Slide 13. I now wish to speak to our business segments. On a statutory basis, the Australian Trading business segment recorded net revenue of $77.2 million and an EBITDA of $8 million in the reporting period compared to the EBITDA loss of $3.4 million in the PCP. On a statutory basis, the U.S. trading segment recorded negative net revenue of $2 million and an EBITDA loss of $69.2 million in the reporting period. The negative H1 net revenue performance did have an impact on overall U.S. EBITDA, with much of the loss being driven by U.S. marketing expenses. The technology segment derives its revenue from licensing fees charged to the Australian Trading business and the group subsidiaries in the U.S. Please note this revenue is eliminated in the company's consolidated results. On a statutory basis, the EBITDA loss for the technology segment for the half year ending 31 December, 2020 was $3.6 million compared to the PCP loss of $2.1 million. Corporate administrative costs cannot be readily allocated to individual operating segments. The statutory EBITDA loss for the corporate segment for the half year ending 31 December, 2020 was $6.4 million, which was largely driven by costs associated with the NBCUniversal transaction and the capital raise as well as increased listing costs given the increased share base of the company. Turning to Slide 14. The balance sheet was strengthened over the reporting period, with the group having net assets of $513 million as at 31st of December, 2020. During the reporting period, the investment in the development of our betting platform and payments for U.S. state licenses and market access saw additions to intangible assets of $20.7 million. As has been well documented, the company completed a successful capital markets transaction in September 2020, raising $353 million. As a result, the company held $359 million of corporate cash as at the 31st December, 2020. PointsBet does not have any corporate borrowings. As part of the NBCUniversal transaction, the company issued equity and options to NBCUniversal, which had a value at the respective issuance dates of USD 123 million. This is the amount that is offset against the USD 393 million commitment and hence, reduces the overall cash commitment of the deal. As such, a corresponding prepayment has been recorded in both current and noncurrent assets, which will reduce over the 5-year commercial term as the NBCUniversal agreement is executed. Secondly, as part of the NBCUniversal transaction, the company agreed with NBC an alternative to exercising the options. NBC may elect at the end of year 5 to receive the $105 million, being the initial options value in cash. That commitment is recorded as a financial liability on our balance sheet and is calculated at the present value of the potential future liability. I'll briefly touch on the cash flows as these have been previously disclosed and detailed as part of our Q1 and Q2 4C reporting requirements. Turning to Slide 15. Net cash flow used in operating activities, excluding movements in player accounts in the half ending 31 December, 2020, were $69.1 million, as previously disclosed. Net cash outflows from investing activities was $35.4 million, and net cash inflow from financing activities was $341.2 million. I'll now hand back to Sam for some further comments.

Thank you, Andy. It's been a great period of continued progress for PointsBet. Turning to Slide 24. I'm very happy with the execution and progress we've made to date under the NBC partnership. Earlier this month, in collaboration with NBC Sports and the PGA Tour, PointsBet powered a first-of-its-kind golf betting companion, BetCast, during the Waste Management Open at TPC Scottsdale's Stadium Course, one of the largest PGA Tour events. BetCast provide a distinct betting version of this major sporting broadcast, with PointsBet having exclusive integrations with our odds, unique markets and promotions. BetCast was distributed via Peacock, the NBC direct-to-consumer platform, and aired for 2.5 hours each day, being 10 hours in total. Now turning to Slide 25. I'm often asked what it means to own in-house technology, and this question is all the more pertinent since the Super Bowl, when a number of U.S. bookmakers experienced technology issues, resulting in poor customer experience and revenue leakage. PointsBet has undertaken an in-house approach to proprietary technology since day 1. This has always been our #1 priority. Not only does this allow PointsBet to control its own product road map and ensure it is delivering a premium and fast user experience, it also allows us to make the required investment to ensure our systems are scalable and ready to cope with the likes of the Super Bowl and the Melbourne Cup. Moving to Slides 31 and 32. PointsBet has an outstanding global team. From day 1, this team has delivered consistently on its objectives. Calendar year 2021 will be another big year. We will shortly launch our iGaming product in Michigan, and this will be followed by launch later in the half in New Jersey. We have taken the time to build a proprietary iGaming platform, and this vertical will continue to be developed throughout 2021 and beyond. As with the approach to all parts of the business, we plan to excel with our iGaming product. We will continue investment in our technology and product to deliver competitive advantages in the key critical areas that we know are required for success. The U.S. sports betting and iGaming opportunity is going to play out over the next 5 to 10 years. And the advantage to those that own the technology is going to become more pronounced as new states launch, complexity increases and clients become more informed about what is a great product versus an average one. Among the jurisdictions which will be at the front of mind for management's planning for the remainder of 2021 are New York and Ontario, Canada. It is estimated that these 2 jurisdictions have a combined total addressable market of circa USD 3.5 billion. The likely near-term opening of these large markets is evidence of the rapidly developing North American opportunity for PointsBet. Finally, we will continue to invest in and build the PointsBet brand in the U.S. for the medium to long term. In the 2020 financial year, less than 1/4 of our marketing spend was above the line at nondigital spend. However, for the current financial year, we expect this to increase to over half, reflecting the transition in our marketing strategy. We will work with our partner, NBC, to further leverage their assets and the benefits that come with being the official sports betting partner of NBC Sports. Improved marketing efficiency will result from increasing brand recognition and lead to growth in overall acquisition and client activity. I'm now happy to take questions.

[Operator Instructions] Our first question is from Rohan Sundram of MST Financial.

Just one question for me on New York in particular. Based on the more recent events, are you any more encouraged or optimistic than, say, several weeks ago on the prospect of a competitive market as the preferred model going forward?

In a nutshell, yes. Obviously, when the governor came out and talked about a potential single operator lottery model, that was a little bit of a surprise I think to the industry. And I think, obviously, that's allowed the industry to try and address that approach versus the preferred approach. And currently, obviously, the legislation do allow sort of that -- both 2 skins, and we're confident that it's heading in the right direction.

The next question is from Jed Kelly of Oppenheimer.

Great. And nice work on the Super Bowl. So as you talk sort of about the product differentiation, I mean, do you figure -- is there a way to market into that? And then how are you thinking about marketing around the NCAA tournament? And then in terms of between New York and Ontario, where are you more positive you'll be able to compete live in the fall?

Jed, I'll handle the first and the last ones, and I might hand to Johnny for NCAA. Yes, I think in terms of marketing, I think it will increasingly become more of a focus around demonstrating and talking to the market about your product. It is a fairly early stage in most states in terms of the sophistication of the market. And those, let's call it, promotions aimed at getting sign-ups are very effective. But I do believe that as the market advances in its sophistication, that the importance of product will become greater. I think even in the state like New Jersey, which perhaps has a deeper gaming background than some of the other states that have come online, you see that with the choice of consumers and PointsBet's market share there. So I think it will become more important and we will look to focus our marketing more -- being more product-centric. I'll talk to the last one before I hand to Johnny on NCAA. In terms of New York or Canada, to be honest, we're pretty confident. We're reasonably confident. I think probably Canada because it doesn't have the overhang of the governor's previous statement around that lottery model. We would think the legislation process in Canada is tracking well, and we should see some positive news, hopefully, in the next few weeks even. Johnny?

Thanks, Sam. On the March status, the plan as always is to differentiate, just stand out from what is a sea of famous and just begin -- use that great springboard as an opportunity to expose more and more people to our internal and proprietary technology. The promotions that we'll settle on will be centered on increasing bet count, increasing play days and really increasing an audience and client activity leading into opening day of the MLB season on April 1. As to the final promotion or sort of headline promotion we'll run on the event, that's yet to be decided. We're currently running a promotion called Make It Rain. We select 1 NCAA end game per day. We use Paige Spiranac, our recently announced brand ambassador, to announce that game. And if you have a qualifying bet on the spread line of at least $50, you get $3 in bonus per 3. So we're gleaning a lot of insights into the performance of that promotion, and that'll help to inform the final promotion that we run on the official tournament for mid-March.

And then -- and just one more follow-up question on the amount of markets you were doing in the Super Bowl. Can you talk about the relative live betting during the Super Bowl relative to last year?

Johnny?

Yes, I can handle that one. I think, again, on the markets that we offer to be clear -- but those were for us pregame markets, so 765 markets were available for betting pregame. In-play, we offered around 75 markets in-play. We have clearly stated and understand where the industry is heading when it comes to the trend of in-play activity. Crudely speaking, at the moment, 50% of sort of bets placed are taken pregame. 50% of bets placed are taken in-game. In 3 years' time, especially the way that our U.S. sports are designed, there's no doubt that this percentage feel will favor in-play up to the tune of probably 80% to 85%. And so we really want to capitalize on that. And to be excellent at in-play, firstly, you have to own your own technology because it's real time, there's no latency. And the second thing is you have to know what you're doing and have experience when it comes to bookmaking. Booking and trading an in-play event is incredibly nuanced and a lot more tricky than booking and trading a pregame event. Admittedly, while we have a lot of upside when it comes to the in-play experience and whilst we saw increased activity year-on-year from last year's Super Bowl to this year's on in-play activity, we do see that as a unique sort of differentiator from what we also took year-on-year in terms of growth on the pregame markets.

Our next question is from Sacha Krien of Evans & Partners.

Just had a couple of questions on the -- those BetCast stats that you provided. Are you able to give us an indication of how successful that was in terms of customer acquisition, those 10 hours?

Yes. Sacha, I'll hand to Johnny again. Obviously, it was the 4 days leading up to the Super Bowl. So you had the mix of Super Bowl excitement along with BetCast, but Johnny?

Yes, sure. I'd say, again, we worked very closely with NBC and wanted to pick the golfing tournament that made sense for us. Firstly, the Waste Management Open is arguably the biggest golfing event outside of the majors here in the U.S. and, again, really having, I guess, what is a tournament leading into our sort of biggest event of the year, the Super Bowl, it was amazing timing and amazing correlation. And there's no doubt, again, on what we saw from the audience and from the sign-ups and from the activity did not only place sort of wagers on the first 3 days of the event of the Waste Management Open, but the last one. And then against sort of correlating into the Super Bowl, we were really pleased and surprised with the attraction it got being a pilot program and also, again, both the acquisition value and also the reactivation value. Again, a lot of dormant clients that hadn't placed a bet to that point in time in February sort of reactivated off the back of seeing the points of brand on the BetCast, engaging with the offers that we run on the BetCast and also engaging with the offers that we ran in the Super Bowl. So again, we give the pilot a big tick.

Okay. Great. Just a question on the early Michigan stats. I know it's only a week or so. Is there much you can read into those early numbers from Michigan? And maybe if you can remind us what NBC's footprint is like in that state.

Yes. I think in terms of -- we're very proud of the fact that we were equal on the starting line with a large number of operators in Michigan. So that was great. I think what it highlights is we -- the FanDuels, DraftKings of the world and even the MGMs and those that have had casinos operating in Michigan and doing sports betting for previous months, obviously, they can still light up those databases. Our -- we're going to start at a very low percentage and then -- and build because we don't have that in-built advantage. So even though our number looked reasonably small for the 9 days of January, I think it was 1.4% market share, it was interesting. That was the fifth biggest because those guys with the databases go bang and they work through that. But I think in looking at those database value, you've got to acknowledge that once they work through those, those databases over the first few months, then the playing field levels up, and that's what we've seen obviously in states like New Jersey and Illinois. What was the second part, Sacha?

I was just curious as to what the NBC footprint is like in that state. I haven't got the presentation in front of me; I'm missing out on that.

Very little. Yes, very little. Look, basically, no, I mean, obviously, the NBC Predictor app, yes, we think there's lots more room for improvement in terms of unlocking that and helping us get better at warming up the stake. So the positive is we're able to get on the starting line. There's definitely some things that we can get better at in terms of hitting the ground even harder from a marketing and acquisition perspective, but there will always be that database advantage for FanDuel and DraftKings.

Yes. That makes sense. Just one more quick question. Just wondering if you can -- do you have any sort of insight or outlook you can provide us on head count for the second half? Should we sort of expect similar numbers of additions as the first half?

Yes. Sacha, it's Andy. Thanks for the question. I think the guidance would be that the key in terms of hiring will continue to be product and technology. You can see in the hiring over calendar year 2020, product and technology dominated, but we were still scaling up into the U.S. So I don't know if I would guide to another 54% increase in the next 6 months, but we are feverishly burrowing on the product and technology side, both in Australia and the U.S. And we've also opened a development hub in India, which now just has 6 employees in that. So we're doing what we can on the product and technology side. Obviously, that's the focus. But I wouldn't necessarily guide to another 54%. We can give some more comments on the next call here on that.

Our next question is from Alice Li of Crédit Suisse.

My first one is a follow-up on NBC. I know it's early days, but are you able to give us an indication of, so far, cost per acquisition for NBC channels relative to CAC from other channels? And also, the quality of customers that's been acquired from the NBC channels?

Yes, Alice. Yes. Look, I think, obviously, allocating sign-ups and first-time betters to direct response channels is easy to go from your Facebooks, your Googles, your digital channels. But it needs to be recognized, obviously, that a lot of our investment with NBC is through TV commercials, integrations into events. So it's not like you're clicking through and you can tag that sign-up directly. So most of -- the direct response stuff, no problem. It is as efficient or more efficient than other direct response channels, and we're very happy with it. Trying to -- obviously, we're getting asked a lot about trying to assess the early impact of NBC. What I've said is, is that our CPAs have been trending in the right direction generally. And given the intensity of spend of our competitors, the fact that we've been able to sort of maintain those at the levels that we're comfortable with, I think is an indication that we've improved. And part of that improvement has come from NBC because the competition, as I say, from bigger spends from our competitors has definitely been there.

Okay. On Illinois, I think a couple of days ago, the Illinois House introduced the iGaming Bill. So is PointsBet trying to take part in iGaming in that state? Presumably, you need to start conversations with a potential partner early.

Yes. We certainly plan to be in iGaming in any state in which it's available. I think the note in the legislation is that it's proposed to be 3 skins per operator so whereas it's a very small list of market access points for sports betting, and we've got one of those, I think when it comes to an iGaming perspective, there's confidence there. Yes. So we would expect to be in iGaming. We do have some elements of an agreement with Hawthorne. So there's some elements there to explore with them. But either way, we'd be greatly confident of being in iGaming in Illinois.