Bragg Gaming Group 2021 Reports Record Fourth Quarter Results as Revenue Rises 14.4%
Bragg Gaming Group (NASDAQ: BRAG) reported a strong financial performance for Q4 and FY 2021, marked by revenue growth of 14.4% to €15.8 million in Q4 and 25.6% to €58.3 million for the full year. The company also emphasized its continued market expansion, increasing its total addressable market to approximately USD $13.5 billion, with plans to enter the U.S. and Canada. Bragg reiterated guidance for 2022 full-year revenue between €68-72 million and Adjusted EBITDA of €9.5-10.5 million, projecting growth of 20% and 39%, respectively. Gross profit margin improved to 51% in Q4.
- Q4 revenue increased 14.4% to €15.8 million.
- Full-year revenue rose 25.6% to €58.3 million.
- Adjusted EBITDA for Q4 grew 22.2% to €1.5 million.
- Gross profit margin reached a record 51%, up 720bps YoY.
- Total addressable market increased to approximately USD $13.5 billion.
- 42% increase in new customers in 2021.
- Continued strong operational momentum into early 2022.
- Net loss for Q4 was €1.6 million, although improved from the previous year.
- Wagering revenue decreased 8.4% in Q4 to €3.1 billion.
Proprietary Online Content and Market Expansion Coupled with Customer Additions Driving Continued Growth
Reiterates Full Year 2022 Guidance for Revenue of
Summary of Q4-21 and FY-21 Financial and Operational Highlights |
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Euros (millions) |
Q4-21 |
Q4-20 |
Change |
Revenue |
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Gross profit |
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Gross profit margin |
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720bps |
Adjusted EBITDA |
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Adjusted EBITDA margin |
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70bps |
Wagering revenue |
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- |
Euros |
FY-21 |
FY-20 |
Change |
Revenue |
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|
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Adjusted EBITDA |
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Wagering revenue |
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Management Commentary
“The 2021 fourth quarter concluded an active and productive year for Bragg as continued execution on our key strategic initiatives drove significant operational accomplishments and strong financial results,” said
“Fourth quarter revenue of EUR
“Our operating momentum has continued in the early months of 2022. We also continue to make progress on closing our acquisition of Spin Games as Bragg has completed all of its regulatory requirements. We are now awaiting final review by the sole remaining regulatory body which is expected to be complete in the next few months. Importantly, we have made substantial progress on the integration of the Spin Games technology platform with our ORYX platform and have already submitted the integrations for certification by various approved
Fourth Quarter 2021 Financial Results and other Key Metrics Highlights
-
Revenue increased by
14.4% to EUR€15.8 million (USD$17.5 million €13.8 million (USD$15.3 million -
Wagering revenue generated by customers decreased
8.8% to EUR€3.1 billion (USD$3.4 billion €3.4 billion (USD$3.8 billion -
Gross profit increased by
33.3% to EUR€8.0 million (USD$8.9 million €6.0 million (USD$6.7 million 51.0% .- The margin expansion is primarily the result of the continued shift towards a higher proportion of revenues from iGaming and turnkey services, which have lower associated cost of sales when compared to games and content.
-
Net loss for the period was EUR
€1.6 million (USD$1.8 million €5.3 million (USD$5.9 million -
Adjusted EBITDA was EUR
€1.5 million (USD$1.7 million 22.2% compared to EUR€1.3 million (USD$1.4 million 9.8% . -
Cash and cash equivalents as of
December 31, 2021 was EUR€16.0 million (USD$17.8 million
2021 Full Year Financial Results and other Key Metrics Highlights
-
Revenue increased by
25.6% to EUR€58.3 million (USD$64.7 million €46.4 million (USD$51.5 million -
Wagering revenue generated by customers increased
21.1% to EUR€14.3 billion (USD$15.9 billion €11.8billion (USD$13.1 billion -
The number of unique players using Bragg games via its Oryx Hub distribution platform and content increased by
11.2% to 6.5 million, from 5.9 million in 2020. -
Gross profit increased by
40.3% to EUR€28.3million (USD$31.4 million €20.2million (USD$22.4 million 48.6% . -
Net loss for the period was EUR
€7.5 million (USD$8.3 million €14.6 million (USD$16.2 million -
Adjusted EBITDA was EUR
€7.2 million (USD$8.0 million 29.8% compared to EUR€5.5 million (USD$6.1 million 12.3% .
Full Year 2022 Revenue and Adjusted EBITDA Guidance
Bragg today reiterated its outlook for 2022 full year expected revenue of EUR
Investor Conference Call
The Company will host a conference call today,
To join the call, please use the below dial-in information:
Participant Toll-Free Dial-In Number (US/
Participant Toll Dial-In Number (INTERNATIONAL): (646) 960-0341
Conference ID: 2522980
Or join the webcast at http://www.bragg.games/investors under the Media section.
A replay of the call will be available until
Cautionary Statement Regarding Forward-Looking Information
This news release may contain forward-looking statements or “forward-looking information” within the meaning of applicable Canadian securities laws (“forward-looking statements”), including, without limitation, statements with respect to the following: the Company’s strategic growth initiatives and corporate vision and strategy; financial guidance for 2021 and 2022, expected performance of the Company’s business; expansion into new markets; the impact of the new German regulatory regime, expected future growth and expansion opportunities; expected benefits of transactions, including the acquisition of Wild Streak and Spin; expected future actions and decisions of regulators and the timing and impact thereof. Forward-looking statements are provided for the purpose of presenting information about management’s current expectations and plans relating to the future and allowing readers to get a better understanding of the Company’s anticipated financial position, results of operations, and operating environment. Often, but not always, forward-looking statements can be identified by the use of words such as “plans”, “expects” or “does not expect”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or describes a “goal”, or variation of such words and phrases or state that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved.
All forward-looking statements reflect the Company’s beliefs and assumptions based on information available at the time the statements were made. Actual results or events may differ from those predicted in these forward-looking statements. All of the Company’s forward-looking statements are qualified by the assumptions that are stated or inherent in such forward-looking statements, including the assumptions listed below. Although the Company believes that these assumptions are reasonable, this list is not exhaustive of factors that may affect any of the forward-looking statements. The key assumptions that have been made in connection with the forward-looking statements include the following: the impact of COVID-19 on the business of the Company; the closing of the acquisition of Spin; the integration of Wild Streak; the regulatory regime governing the business of the Company; the operations of the Company; the products and services of the Company; the Company’s customers; the growth of Company’s business, the meeting minimum listing requirements of Nasdaq; which may not be achieved or realized within the time frames stated or at all; the integration of technology; and the anticipated size and/or revenue associated with the gaming market globally.
Forward-looking statements involve known and unknown risks, future events, conditions, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from any future results, prediction, projection, forecast, performance or achievements expressed or implied by the forward-looking statements. Such factors include, among others, the following: risks related to the Company’s business and financial position; that the Company may not be able to accurately predict its rate of growth and profitability; the risks associated with the completion of the acquisition of Spin and ability to satisfy closing conditions; risks associated with the integration of Wild Streak; risks associated with general economic conditions; adverse industry events; future legislative and regulatory developments; the inability to access sufficient capital from internal and external sources; the inability to access sufficient capital on favorable terms; realization of growth estimates, income tax and regulatory matters; the increased costs associated with meeting the minimum listing requirements on Nasdaq; the ability of the Company to implement its business strategies; competition; economic and financial conditions, including volatility in interest and exchange rates, commodity and equity prices; changes in customer demand; disruptions to our technology network including computer systems and software; natural events such as severe weather, fires, floods and earthquakes; and risks related to health pandemics and the outbreak of communicable diseases, such as the current outbreak of COVID-19. Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.
The Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events, or otherwise, except in accordance with applicable securities laws.
Non-IFRS Financial Measures
Statements in this news release make reference to “Adjusted EBITDA”, which is a non-IFRS (as defined herein) financial measure that the Company believes is appropriate to provide meaningful comparison with, and to enhance an overall understanding of, the Company’s past financial performance and prospects for the future. The Company believes that “Adjusted EBITDA” provides useful information to both management and investors by excluding specific expenses and items that management believe are not indicative of the Company’s core operating results. “Adjusted EBITDA” is a financial measure that does not have a standardized meaning under International Financial Reporting Standards (“IFRS”). As there is no standardized method of calculating “Adjusted EBITDA”, it may not be directly comparable with similarly titled measures used by other companies. The Company considers “Adjusted EBITDA” to be a relevant indicator for measuring trends in performance and its ability to generate funds to service its debt and to meet its future working capital and capital expenditure requirements. “Adjusted EBITDA” is not a generally accepted earnings measure and should not be considered in isolation or as an alternative to net income (loss), cash flows or other measures of performance prepared in accordance with IFRS. Adjusted EBITA is more fully defined and discussed, and reconciliation to IFRS financial measures is provided, in Company’s Management’s Discussion and Analysis (“MD&A”) for the three- and twelve-month periods ended
About
Through its wholly-owned subsidiary ORYX Gaming, Bragg delivers proprietary, exclusive and aggregated casino content via its in-house remote games server (RGS) and ORYX Hub distribution platform. ORYX offers a full turnkey iGaming solution, including its Player Account Management (PAM) platform, as well as managed operational and marketing services.
In
Financial tables follow
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CONSOLIDATED STATEMENTS OF LOSS AND COMPREHENSIVE LOSS |
|||||||||
(In thousands, except per share amounts) |
|||||||||
| Three Months Ended |
Year Ended |
||||||||
2021 |
|
2020 |
|
2021 |
|
2020 |
|
||
| Revenue | 15,758 |
|
13,778 |
|
58,319 |
|
46,421 |
|
|
| Cost of revenue | (7,722 |
) |
(7,748 |
) |
(29,998 |
) |
(26,232 |
) |
|
| Gross Profit | 8,036 |
|
6,030 |
|
28,321 |
|
20,189 |
|
|
| Selling, general and administrative expenses | (9,899 |
) |
(10,416 |
) |
(34,832 |
) |
(22,828 |
) |
|
| Gain on remeasurement of consideration receivable | 50 |
|
37 |
|
98 |
|
19 |
|
|
| Loss on remeasurement of deferred and contingent consideration | - |
|
(947 |
) |
- |
|
(9,276 |
) |
|
| Loss on disposal of intangible assets | (89 |
) |
- |
|
(89 |
) |
- |
|
|
| Operating Loss | (1,902 |
) |
(5,296 |
) |
(6,502 |
) |
(11,896 |
) |
|
| Net interest expense and other financing charges | (52 |
) |
(109 |
) |
(184 |
) |
(1,384 |
) |
|
| Loss Before Income Taxes | (1,954 |
) |
(5,405 |
) |
(6,686 |
) |
(13,280 |
) |
|
| Income taxes | 324 |
|
89 |
|
(826 |
) |
(1,196 |
) |
|
| Net Loss from Continuing Operations | (1,630 |
) |
(5,316 |
) |
(7,512 |
) |
(14,476 |
) |
|
| Net loss from discontinued operations after tax | - |
|
(2 |
) |
- |
|
(90 |
) |
|
| Net Loss | (1,630 |
) |
(5,318 |
) |
(7,512 |
) |
(14,566 |
) |
|
| Items to be reclassified to net loss: | |||||||||
| Cumulative translation adjustment - continuing operations | 677 |
|
(129 |
) |
2,590 |
|
157 |
|
|
| Cumulative translation adjustment - discontinued operations | - |
|
(80 |
) |
- |
|
(95 |
) |
|
| Items that will not be reclassified to net loss: | |||||||||
| Remeasurement of employee obligations | 44 |
|
- |
|
44 |
|
- |
|
|
| Net Comprehensive Loss | (909 |
) |
(5,527 |
) |
(4,878 |
) |
(14,504 |
) |
|
| Basic and Diluted Loss Per Share | |||||||||
| Continuing operations | (0.08 |
) |
(0.52 |
) |
(0.39 |
) |
(1.69 |
) |
|
| Discontinued operations | 0.00 |
|
(0.00 |
) |
0.00 |
|
(0.01 |
) |
|
(0.08 |
) |
(0.52 |
) |
(0.39 |
) |
(1.70 |
) |
||
| Millions | Millions | Millions | Millions | ||||||
| Weighted average number of shares - basic and diluted | 20.0 |
|
10.3 |
|
19.5 |
|
8.6 |
|
|
|
||||
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION |
||||
(in thousands) |
||||
| As at | As at | |||
2021 |
|
2020 |
|
|
| Cash and cash equivalents | 16,006 |
|
26,102 |
|
| Trade and other receivables | 8,454 |
|
10,297 |
|
| Prepaid expenses and other assets | 2,442 |
|
263 |
|
| Consideration receivable | 56 |
|
148 |
|
| Total Current Assets | 26,958 |
|
36,810 |
|
| Property and equipment | 252 |
|
272 |
|
| Right-of-use assets | 579 |
|
708 |
|
| Consideration receivable | - |
|
44 |
|
| Intangible assets | 30,845 |
|
14,279 |
|
24,728 |
|
19,938 |
|
|
| Other assets | 28 |
|
43 |
|
| Total Assets | 83,390 |
|
72,094 |
|
| Trade payables and other liabilities | 14,357 |
|
16,968 |
|
| Deferred revenue | 27 |
|
102 |
|
| Income taxes payable | 784 |
|
1,318 |
|
| Lease obligations on right of use assets - current | 149 |
|
133 |
|
| Deferred and contingent consideration | - |
|
11,521 |
|
| Total Current Liabilities | 15,317 |
|
30,042 |
|
| Deferred income tax liabilities | 1,243 |
|
1,415 |
|
| Non-current lease obligations on right of use assets | 451 |
|
593 |
|
| Other non-current liabilities | 184 |
|
147 |
|
| Total Liabilities | 17,195 |
|
32,197 |
|
| Share capital | 100,285 |
|
62,304 |
|
| Warrants | - |
|
1,642 |
|
| Broker warrants | 38 |
|
399 |
|
| Shares to be issued | 13,746 |
|
22,608 |
|
| Contributed surplus | 18,385 |
|
14,325 |
|
| Deficit | (68,743 |
) |
(61,231 |
) |
| Accumulated other comprehensive income (loss) | 2,484 |
|
(150 |
) |
| Total Equity | 66,195 |
|
39,897 |
|
| Total Liabilities and Equity | 83,390 |
|
72,094 |
|
|
|||||||||
UNAUDITED SELECTED FINANCIAL GAAP AND NON-GAAP MEASURES |
|||||||||
(in thousands) |
|||||||||
| Three Months Ended |
Year Ended |
||||||||
2021 |
|
2020 |
|
2021 |
|
2020 |
|
||
| Revenue | 15,758 |
|
13,778 |
|
58,319 |
|
46,421 |
|
|
| Operating loss | (1,902 |
) |
(5,296 |
) |
(6,502 |
) |
(11,896 |
) |
|
| EBITDA | (325 |
) |
(4,623 |
) |
(1,705 |
) |
(9,023 |
) |
|
| Adjusted EBITDA | 1,538 |
|
1,259 |
|
7,198 |
|
5,546 |
|
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20220310005132/en/
Chief Strategy Officer JCIR
info@bragg.games
Source:
FAQ
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