Scientific Games Signs German ContractScientific Games announced today that its German subsidiary Scientific Games Honsel GmbH was awarded a contract with Lotterie-Treuhandgesellschaft mbH Hessen, the state lottery of Hessen, based in Wiesbaden, to supply instant lottery tickets and other lottery services.
The contract begins February 1, 2006, and will run for five years, with options to extend for additional two-year increments. Scientific Games Honsel will handle the manufacturing and distribution of instant tickets throughout Hessen, including shipping, warehousing, telemarketing, retailer recruitment and will advise on game design and marketing issues. Revenues to Scientific Games Honsel will be based on a percentage of sales. Hessen has a population of 6 million, about the same as the U.S. State of Indiana, and approximately 8 percent of the population of Germany. "We see strong potential growth throughout Hessen for instant ticket sales," said Scientific Games Chairman and CEO Lorne Weil. "We are also executing on our strategy to expand the range of services we provide, and bring our best practices to German lotteries." According to Weil, instant tickets account for only 1% of lottery sales in Hessen, a euro 650 million lottery market. This is a sharp contrast to the American market, where instants provide more than half of total sales. European per capita instant sales are also significantly higher in the UK, Italy and France, where Scientific Games is also the primary instant ticket supplier. "Scientific Games is an industry leader with impressive European lottery experience," said Dr. Heinz-Georg Sundermann, Managing Director of Lotterie-Treuhandgesellschaft mbH Hessen. "We see great potential sales growth here, and the ability to return more funds to the public we serve." "We have had a close relationship with Lotterie-Treuhandgesellschaft mbH Hessen for many years which is strengthened again by this agreement. We look forward to growing instant ticket sales at a faster rate with these new services," said Dr. Jan Honsel, Managing Director of Scientific Games Honsel.
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