Kentucky Lottery Corporation’s (KLC) board of directors says February income down slightly but bottom line willl meet state’s expectations.
Year-to-date sales thru February were $639.6 million, which is $24 million (3.6%) less than the same period last year and $21.6 million (3.3%) less than budgeted. The number from last year is somewhat inflated as the KLC was just coming off the world record-breaking $1.6 billion Powerball jackpot.
The main issue in the decline, according to KLC Vice President and Corporate Controller Maggie Garrison, is softness in the lottery’s scratch off ticket products.
“Instant ticket sales are off almost $16 million from last year, and are down $22.6 million from budget,” according to Garrison. “However, changes to the product are starting to result in positive sales.”
Sales for March are already showing improvement.
“Our scratch-off ticket sales in March are ahead of budget so far, and that’s before the launch of Big Money, the largest physical ticket we’ve ever sold on March 27th,” Garrison said. “We feel our efforts to improve sales are really coming together, and we’ll see that in the remaining months of the fiscal year.”
Even though sales are down, lower than budgeted prize payouts and operating expenses have helped the KLC’s bottom line.
“Our income before transfer of dividends thru February was $161.3 million,” said the KLC’s Executive Vice President & CFO Howard Kline. “Despite the shortfall in our sales, we’re on track to hit the proceeds number expected by the Commonwealth.” He also announced that sales since inception of the KLC recently surpassed the $18 billion mark and $4.8 billion in earned income for state.
Board Chair Mark Sommer updated the group on the process of the search for a new president and CEO for the organization. He said the final tally for candidates was 660, that the search committee has narrowed down the list to a small group of candidates they will soon interview, and then pass along finalists to the governor’s office for their decision.
“This search has been both significant and detailed, and we’re pleased with the overwhelming interest in the position,” said Sommer. “We remain very optimistic that we’ll have strong candidates to present to Governor Bevin for his consideration in a few weeks.”
In other business, the board approved contract renewals with:
— Smartplay International for draw machine maintenance;
— Garron Lottery Products for draw machine balls and machine maintenance;
— Gaming Laboratories International for lottery ball testing, random number generator evaluation and related services;
— Blue & Company for draw audit and related services, and;
— Goldberg Simpson, LLC and Valenti Hanley, PLLC for legal services.
The board also approved a new contract with Software House International Corporation for STRATA software online services, along with rules and regulations for 13 instant games, seven Instant Play games, and amended Keno draw rules.
The next meeting of the KLC’s board of directors will be June 16.
From Kentucky Lottery Communications