Past Present and Future Warwick Bartlett CEO Global

Past, Present and Future Warwick Bartlett, CEO Global Betting & Gaming Consultants

GGY per Capita in 2013 (US$) Source: GBGC’s Global Gambling Report

Las Vegas Strip Casino GGY (US$bn) 2005 -2014 Source: GBGC’s Global Gambling Report

Greece Casino GGY (€m) 2005 -2014 Source: GBGC’s Global Gambling Report

GBGC 50 vs i. GBGC Index Jan/05 – Oct/15 Source: GBGC’s Global Gambling Report

GBGC – Consulting, Data, Reports, Feasibility, Research

Gambling Tax: The Only Way Is Up Jurisdiction Tax Change Neuquen, Argentina Gaming tax increased from 16% to 22% in 2014 Bulgaria Lottery tax raised from 12% to 15% of sales (2011) Massachusetts, US 5% tax on lottery and betting wins over $600 South Africa 1% levy on GGY instead of new winnings tax Spain 20% tax on lottery prizes over € 2, 500 Armenia Gaming duties increased from 2013 Croatia Tax on gambling winnings increased twice, in April 2014 and then again from January 2015 for betting winnings 7

Gambling Tax: The Only Way Is Up cont. Jurisdiction Tax Change Western Cape, South Africa Tiered casino tax increased by 2 percentage points for each rate (March 2013). Panama Casino tax raised twice, from 10% in 2010 to 15% in 2012; machine tax raised several times from 10% in 2010 to 22% in 2014 Mexico Gaming tax up from 20% in 2008 to 30% in 2010 Finland Lottery tax on slots and casinos up from 8. 25% to 10%, horse racing tax up to 10%, all from 2012 Romania Winnings and admissions tax up from 2010 Macedonia Gaming taxes increased, winnings tax introduced from 2013 UK Point of consumption tax of 15% on gross profits for remote gambling from 1 December 2014 8

Gambling Tax: The Only Way Is Up cont. Jurisdiction Tax Change New York, US 5% tax also applied to out-of-state ADW operators 1 January 2014 Kenya 20% on gambling winnings from 2014 Ukraine War tax on lottery prizes announced in late 2014 Italy AWP and VLT tax in effect from January 2015, proposal to increase the rates in autumn 2015 Ireland Online gambling tax introduced in August 2015 Czech Republic Taxes for bookmakers proposed to increase to 23% and to 28% for slot machines from 2016 Vietnam A proposal to increase special consumption tax for casino from 30% to 35% from 2016 9

Gambling Tax: The Only Way Is Up cont. Jurisdiction Tax Change Italy 20 to 25% Gross Profits Belgium 11% Gross Profits Denmark 20% Gross profits Spain 25% Gross profits France Sports 9. 3% Horses 13. 2% Poker 2% Cash Game Pot VAT 20% Germany 5% tax amount staked for sports and lotteries. VAT at 19% for egaming. Ireland VAT Ireland 23% 10

GBGC – Consulting, Data, Reports, Feasibility, Research

Combined Effect – Tax Increase and Recession • • • Tough for smaller operators Fewer start-ups On-shore trying to marginalise off-shore Complex and costly regulation Consolidation (37 deals worth US$32 bn in 18 months)

However. . . Paddy Power, Betfair and Bet 365 produced shareholder value in excess of US$18 bn in 10 years

Operator Concerns with Regulation • Dormant accounts • Common standards • Suspicious transaction reporting

GBGC – Consulting, Data, Reports, Feasibility, Research

I will clog your arteries and cause a stroke or heart attack!

GBGC – Consulting, Data, Reports, Feasibility, Research

www. gbgc. com

Thank you! www. gbgc. com Warwick Bartlett CEO warwick@gbgc. com