Operator Bally’s Corporation is to cut 15% of the workforce from its North America interactive division as part of a restructuring plan for the business segment.
In a filing with the US Securities and Exchange Commission, Bally’s said the layoffs would help it reduce operating costs and continue its commitment to achieving profitable operations in its North American interactive segment.
Bally’s said the elimination of positions within the interactive business are subject to local law and consultation requirements in certain countries, as well as the operator’s business needs.
The operator added that the 15% reduction in staff headcount for the division would cost between $10.0m and $15.0m in cash severance payments, with the redundancies to take place during the first quarter.
Difficult decision
Writing in a letter to Bally’s Interactive employees, Bally’s chief executive Lee Fenton said it was a “difficult decision” to cut jobs but would help the business become “stronger and fitter” for the future.
“We’ve reflected hard as a business to come to this conclusion,” Fenton said. “Everyone put in so much effort last year, and I am proud of what we achieved together. However, we didn’t manage to achieve everything we had hoped for.
“Our mature businesses continue to grow but are facing into macro uncertainties. Our North America business remains an investment market, where the returns will be reaped but we can now see that this will take some time to come to fruition, so we need to manage our cost base appropriately.”
Over-hiring
Fenton said that while Covid-19 pandemic had a positive impact on Bally’s Interactive, this led to the business hiring staff at “full pelt”. However, Fenton said this led to over-hiring in some areas, which he accepted full responsibility for.
Employees impacted by the cuts will be contacted in the coming days. Fenton said Bally’s would full support these individuals with fair terms and treatment.
“We have been considering how we rescope our roadmaps to ensure they are right sized,” Fenton said. “This is an opportunity to reset the business, so let’s ensure that these changes, whilst made with an extremely heavy heart, put us on an even stronger footing, where we can operate with pace, agility, and focus.
“We have very special people here, and the employees being affected aren’t just colleagues, they’re friends. Please rally around them and let’s support each other through these changes. Most of all, please lean on your leadership, including me, as we all work through this difficult time together.”
Evaluating future
The announcement comes after Fenton in November said Bally’s would be “evaluating” its money-losing North American businesses as the company focuses on a strict path to profitability.
Fenton at the time said that Bally’s plans had entered a new phase where loss-making assets would be examined to ensure how they fit into the operator’s wider strategic picture.
The business made a major wave of acquisitions in 2020 and 2021, including those of Gamesys and Bet.Works.