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Fitch reaffirms online gaming forecast following January revenue report

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Following Wednesday's release of online gaming revenue results for January, Fitch Ratings has reaffirmed a report it issued in November forecasting the state's revenue figures to come in at around $200 to $300 million in the first year.

According to the state Division of Gaming Enforcement, January saw a 28 percent increase in online gaming win, netting $9.5 million as opposed to the 7.4 million reported in December.

While January's numbers don't quite match up to Fitch's projections, the report notes that "sequential growth" over the next few months is attainable with the expected uptick in marketing and online gaming players' awareness.

"Although the January figure annualizes to only $114 million, we think the 10 percent sequential growth rate needed to reach achieve the low end of our estimated range is achievable," the report said.

However, the report noted that payment processing is a concern going forward as several banks and credit card companies are still slow to embrace online gaming.

"The lack of convenient payment options will slow the adoption rate of online gaming as potential players are turned off by waiting for a deposit or withdrawal to process or by having to find a nearby store that facilitates payments," the report stated. "Longer-term people will adapt to the available payment methods and some banks will find increased comfort with the legal framework around processing gambling related payments."

By reaffirming its November report, Fitch is also standing by its claim that revenues will come in "well below" Gov. Chris Christie's projection of more than $1 billion in the first year.

When asked by reporters about the Fitch report in December, Christie said his projections were the "same as they were before."

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Andrew George

Andrew George

Andrew George covers the Statehouse from NJBIZ's Trenton bureau. Born and raised in N.J., Andrew has also spent time as a reporter in D.C., Texas and Pa. His email is andrewg@njbiz.com and he is @AndrGeorge on Twitter.

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