Kentucky Lottery Corp.’s sales trend established early in the fiscal year continued to hold true through February. But while overall sales are ahead of where they were last year, they remain below budget.
According to the KLC’s Vice President of Finance Rick Kelley, the one product line not following this trend was instant tickets. Year-to-date scratch-off ticket sales in the period from July through February were $359.6 million, which was $9.3 million more than budget and $21.1 million more than the same period last year.
Overall draw game sales for the same period though were $197.5 million, which is $25.8 million less than budget and $13.9 million less than the same period last year. This decline was being led by the multistate games Powerball and Mega Millions. These two products year to date have sold $70.6 million, which is $16.7 million down from last year and $19.4 million below budget. Keno sales were $30.4 million, $4.2 million less than budget but $15.8 million more than last year. Pick 3 sales are trending upward though, finishing the period $4.7 million more than last year and $3.7 million more than budgeted.
“Overall sales for the period were $587.5 million,” Kelley said. “That’s $23.1 million more than last year, but that number still falls $20.7 million below budget for the fiscal year.”
With total sales being below expectations, fewer dollars will be available for transfer to the state. Income before transfer of dividends for the year-to-date period was $153.7 million, which is $3.2 million more than last year but $6.9 million less than budgeted. As a result, the board voted to reduce scheduled payments to the state for the next two months by $2 and $3 million, with final transfers for the year to be set at the board’s next meeting.
“A solid Powerball run of $564 million in February helped the game recover somewhat from a disappointing year,” said the KLC’s Executive Vice President and CFO Howard Kline. “Powerball sales in February were $10.7 million, but even with this bump the lackluster jackpots of most of the past year have led to a drop of $11.9 million in Powerball sales as compared to last year. We’re hoping for a couple of good solid jackpot runs before the end of the fiscal year to help with profitability.”
Kline also said bad weather during February cost the KLC about $5 million in sales.
“The things we have control over – such as our scratch-off tickets – are doing really well,” said the KLC’s President and CEO Arch Gleason. “It’s what we have no control over – primarily the multistate jackpot games that have seen very few good runs over the course of the year – that has affected our bottom line. Powerball and Mega Millions are our most profitable products, and the sales hit we’ve taken there has definitely affected our overall profitability.”
Gleason reported Powerball game changes planned for July have been postponed to a later date. The Monopoly Millionaires Club instant game is now scheduled to start in late April. The new multistate game Lucky for Life got off to a good start last week with sales exceeding $200,000.
From Kentucky Lottery Corp.