As revenues improve, Manitoba Liquor & Lotteries wants to try luck with online gaming expansion

In this fiscal year, liquor sales are up, cannabis revenues should double because dozens of new stores have opened and casinos profits are rising because those venues have been open for much of the year.

98% drop in thefts, nearly 100% drop in robberies after controlled entrances installed at liquor stores: CEO

a man's head is silhouettedin the light of a VLT machine
Manitoba Liquor & Lotteries expects an increase in gambling revenues for this fiscal year, since casinos have able to keep their doors open for much of the year. (Mike Groll/The Associated Press)

Manitoba Liquor & Lotteries plans to roll the dice on expanding its online gambling presence, as the Crown corporation's revenues rebound following a year marked by pandemic shutdowns.

At a legislative committee hearing on Tuesday where he presented the corporation's report for the 2020-21 fiscal year, president and CEO Manny Atwal said its financial situation is improving.

In the 2021-22 fiscal year so far, liquor sales are up, cannabis revenues should double because dozens of new stores have opened, and casino profits are rising because those venues have been open for much of the year, he said.

The corporation's net income is expected to hit $570 million for the fiscal year ending this March, Atwal estimated, a notable increase from $425 million in 2020-21 but still down from the pre-pandemic $606 million reported in 2019-20.

One way Liquor & Lotteries hopes to bounce back financially is with the continued growth of online gaming.

It expects revenues of $50-$60 million this fiscal year alone through, its online gaming platform.

Despite that significant growth, Manitoba's venture faces competition from international players. 

Atwal called PlayNow Manitoba's only legal gaming site, but added "we also understand that many of our customers moved to illegal or grey-market sites."

Liquor & Lotteries estimates the overall gaming market in Manitoba is worth $75 million to $150 million in revenue annually.

Gaming site needs exposure: CEO

PlayNow could take a larger share of that market with stronger brand awareness, he said.

"I know this group has heard of it, but I'm pretty sure most of you don't know much about it," Atwal told the committee, which has members from the governing Progressive Conservatives as well as the NDP and Liberals.

"That's our challenge — we need to get Manitobans to know more about it."

As for liquor, Atwal suspects Manitobans are "essentially at pre-pandemic consumption levels," saying the panic buying of the early pandemic is behind us.

However, the consumer trend of visiting liquor stores less frequently but buying more product is continuing. Liquor & Lotteries also sees more people turning to "refreshment beverages" — such as hard seltzer products — rather than beer and wine.

Controlled entrances at many of the provinces Liquor Marts have slashed the number of thefts and robberies at the store, says MLL CEO Manny Atwal. (Angela Johnston/CBC)

Customers are spending more per product, too. 

"Instead of spending $20 on a bottle of spirit, they'll spend $23 on a bottle of spirit," Atwal said.

Liquor sales hit $886 million in the 2020-21 fiscal year, an increase of 11 per cent from the year before.

Meanwhile, cannabis revenues jumped from $51.5 million in 2019-20 to $80.2 million in the last fiscal year.

Atwal anticipates a similar spike for 2021-22, because the number of cannabis stores could double in a year from around 70 to 140 locations. The Liquor, Gaming and Cannabis Authority of Manitoba currently lists 135 stores on its website.

Manitoba's cannabis market is starting to approach market saturation, Atwal said, with that point likely somewhere between 170 to 200 stores.

Liquor store thefts, robberies plunge

The corporation's boss also said the thousands of thefts Manitoba liquor stores saw in 2019 are a thing of the past, following new security measures.

He reported a 98 per cent decrease in thefts and a nearly 100 per cent drop in robberies after controlled entrances were installed at all Liquor Mart locations in Winnipeg and in some rural communities. 

After public calls to add the security measures in more locations, controlled entrances were installed at Liquor Marts in Flin Flon and The Pas, and will soon be added in Thompson, Atwal said.

For its employees, Manitoba Liquor & Lotteries will make working from home a permanent measure, even after the pandemic subsides, Atwal said.

He said Liquor & Lotteries' hybrid working model will allow corporate staff to work off-site and on-site in the long term, and will also let the corporation sell some real estate, such as the old distribution centre on Buffalo Place in Winnipeg.

"This is going to allow us to divest of multiple properties, achieve one-time net income benefits, plus reduce long-term occupancy costs, thereby improving profitability for the province."