London-listed DJI Holdings Plc – described as a licensed and authorised distributor and promoter of regulated lottery products in the Chinese lottery market – on Tuesday said it is continuing to sell mainland welfare and sports lottery tickets through mobile channels and land-based outlets and “will resume online sales immediately once the suspension is lifted”.
That was a reference to a reported temporary suspension in stages – starting on February 25 and extending across the country on February 28 – of online lottery sales in mainland China. The notice that led to the suspension was issued jointly by the Ministry of Finance, Ministry of Civil Affairs and the General Administration of Sports of the People’s Republic of China.
“During this short suspension, lottery sales across the industry in China will be materially reduced. However, DJI Holdings Plc believes that online sales will resume in the near future and, as such, this suspension will not have a material impact on its full year results for 2015,” said the firm, which is listed on London’s Alternative Investment Market.
DJI Holdings’ stock fell 8.67 percent on Tuesday trading, closing that day at GBP68.50 (US$103.27), according to data from Bloomberg.
The company said it views the suspension “as an important step in controlling unauthorised online lottery sales in China. “DJI believes such measures will have long-term beneficial effects on the industry,” it added.
In a separate development, it was reported that 500.com Ltd – a Shenzhen-based firm that had also been selling China sports lottery tickets via online platforms – on Friday had faced a proposed class action in California federal court in the United States.
Joseph Fragala is attempting to sue 500.com, its board of directors and the underwriters for the firm’s 2013 initial public offering (IPO) on the New York Stock Exchange. He alleges 500.com misled investors in a November 2013 prospectus and through subsequent statements about its legal authorisation to issue and sell lottery tickets online. 500.com said at the time of its IPO that it had obtained the right to sell China lottery tickets thanks to an understanding with China’s Ministry of Finance.
Combined sales in mainland China during 2014 of sports lottery and welfare lottery tickets reached RMB382.4 billion (US$61.5 billion) in 2014, an increase of 23.6 percent from the previous year, according to data from the ministry released on January 20.
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