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Powerball sales drive Hoosier Lottery revenue to record high

June 28, 2013
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The Hoosier Lottery is on pace for a record revenue year, thanks in part to higher Powerball ticket prices and jackpots.

The lottery projects that revenue for its 2013 fiscal year ending June 30 will be $945 million, about 10.4 percent more than last year’s record of $855.6 million.

Surplus revenue to the state will be $227.6 million, according to the forecast, about 8 percent more than last year’s surplus revenue. Net income to the state, which accounts for the value of investments, is estimated to be about the same as last year.

Lottery spokeswoman Stephanie McFarland said scratch-off ticket sales also contribute to the record revenue projection. The lottery estimates $626.2 million for the full year, which would be an increase of $78.6 million, or 14 percent, over last year.

Indiana Gaming Insight Publisher Ed Feigenbaum said the lottery's forecasted 2013 revenue would be a record "by far," although he called it "wind-aided" because of the Powerball effect.

Changes introduced to the multi-state game last year have created enormous jackpots and driven overall revenue higher. Powerball ticket prices doubled to $2, and jackpots now start at $40 million, instead of $20 million.

The lottery’s forecast predicts total Powerball sales will hit $140.4 million, a 39-percent jump over last year.

In the month of May—when the multi-state jackpot hit $590 million—Indiana sales were $22 million. That was a 182-percent increase over the $7.8 million collected in the same month last year.

One reason the record sales won’t bring more income to the state for the fiscal year is that the lottery is spending about twice as much as it did last year on advertising and promotion—nearly $23 million. The commission forecasts total operating expenses will come in at $716.5 million, 11 percent higher than last year's $645 million.

The commission inked a long-term outsourcing contract in October with lottery manager GTECH Indiana. One of the gaming firm’s first changes was a new “Imagine that” advertising campaign.

More changes are in the works. GTECH plans to launch televised drawings for Mega Millions and Powerball this summer, according to a tentative schedule presented to the commission. Drawings for the Daily 3 and Daily 4 games will roll out around Labor Day.

GTECH estimates that it will spend $1.2 million on television station fees in the next fiscal year.

The company plans to sign with one “flagship station,” according to information presented to the commission, but McFarland said there’s no signed contract yet.

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