Galaxy Gaming Reports Q2 2022 Financial Results
Galaxy Gaming, Inc. (OTCQB: GLXZ) reported financial results for Q2 and 1H 2022, showing a 20% revenue increase to $5.68M for Q2 and 28% growth to $11.60M for the first half. Adjusted EBITDA rose by 10% to $2.36M in Q2 and 31% to $5.03M year-to-date. Despite the increases, the company faced a net loss of $1.12M for Q2 compared to a profit of $0.55M in 2021. Additionally, the firm has revised its annual revenue guidance downward to between $22.5M and $23.5M, citing inflation and unfavorable currency impacts.
- Q2 revenue increased 20% to $5.68M.
- 1H revenue rose 28% to $11.60M.
- Adjusted EBITDA increased 10% to $2.36M in Q2, and 31% to $5.03M in 1H 2022.
- Q2 net loss of $(1.12M) versus net income of $0.55M in 2021.
- 2022 revenue guidance lowered to $22.5M - $23.5M due to economic pressures.
LAS VEGAS, Aug. 15, 2022 (GLOBE NEWSWIRE) -- Galaxy Gaming, Inc. (OTCQB: GLXZ), a developer and distributor of casino table games and enhanced systems for land-based casinos and iGaming content, announced today its financial results for the quarter and six months June 30, 2022.
Financial Highlights
Q2 2022 vs. Q2 2021
- Revenue increased
20% to$5,676 K - Adjusted EBITDA increased
10% to$2,358 K - Net loss of
$(1,116) K vs. net income of 550K
1H 2022 vs. 1H 2021
- Revenue increased
28% to$11,595 K - Adjusted EBITDA increased
31% to$5,032 K - Net loss of
$(1,130) K vs. net income of 639K
Balance Sheet Changes (vs. December 31, 2021)
- Cash increased
7% to$17,250 K - Total long-term debt1 (gross) decreased to
$59,868 K from$60,500 K - Stockholders’ deficit increased to
$(18,029 7)K from$(17,286) K
Executive Comments
“The second quarter of 2022 was a perfect storm of rates - foreign exchange rates, inflation rates and interest rates,” said Harry Hagerty, Galaxy’s CFO. “The appreciation of the US Dollar against the Euro and the British Pound cost us
“The external conditions that Harry described masked what was an excellent quarter and first half,” said Todd Cravens, President and CEO. “On a constant currency basis, revenue increased by
“Despite the headwinds, our liquidity and balance sheet remain in good shape,” continued Hagerty. “We had more than
“Unfortunately, current exchange rates are even lower now than they were in Q2,” Hagerty added. “On the assumption that these rates will be with us for the rest of the year and that the cost and wage pressures will also continue, we are lowering our guidance for the year. We now forecast revenue in a range of
Forward-Looking Statements
This press release contains, and oral statements made from time to time by our representatives may contain, forward-looking statements based on management's current expectations and projections, which are intended to qualify for the safe harbor of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include statements identified by words such as "believe," "will," "may," "might," "likely," "expect," "anticipates," "intends," "plans," "seeks," "estimates," "believes," "continues," "projects" and similar references to future periods, or by the inclusion of forecasts or projections. All forward-looking statements are based on current expectations and projections of future events.
These forward-looking statements reflect the current views, models, and assumptions of Galaxy Gaming, and are subject to various risks and uncertainties that cannot be predicted or qualified and could cause actual results in Galaxy Gaming's performance to differ materially from those expressed or implied by such forward looking statements. These risks and uncertainties include, but are not limited to, the ability of Galaxy Gaming to enter and maintain strategic alliances, product placements or installations, in land based casinos or grow its iGaming business, garner new market share, secure licenses in new jurisdictions or maintain existing licenses, successfully develop or acquire and sell proprietary products, comply with regulations, have its games approved by relevant jurisdictions, and adapt to changes resulting from the COVID-19 pandemic and other factors. All forward-looking statements made herein are expressly qualified in their entirety by these cautionary statements and there can be no assurance that the actual results, events or developments referenced herein will occur or be realized. Readers are cautioned that all forward-looking statements speak only to the facts and circumstances present as of the date of this press release. Galaxy Gaming expressly disclaims any obligation to update or revise any forward-looking statements, whether because of new information, future events or otherwise.
About Galaxy Gaming
Headquartered in Las Vegas, Nevada, Galaxy Gaming (galaxygaming.com) develops and distributes innovative proprietary table games, state-of-the-art electronic wagering platforms and enhanced bonusing systems to land-based, riverboat, and cruise ship and casinos worldwide. In addition, through its wholly owned subsidiary, Progressive Games Partners LLC, Galaxy licenses proprietary table games content to the online gaming industry. Connect with Galaxy on Facebook, YouTube and Twitter.
Non-GAAP Financial Information
Adjusted EBITDA includes adjustments to net loss/income to exclude interest, taxes, depreciation, amortization, share based compensation, gain/loss on extinguishment of debt, foreign currency exchange gains/losses, change in estimated fair value of interest rate swap liability and severance and other expenses related to litigation. Adjusted EBITDA is not a measure of performance defined in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”). However, Adjusted EBITDA is used by management to evaluate our operating performance. Management believes that disclosure of Adjusted EBITDA allows investors, regulators and other stakeholders to view of our operations in the way management does. Adjusted EBITDA should not be considered as an alternative to net income or to net cash provided by operating activities as a measure of operating results or of liquidity. Finally, Adjusted EBITDA may not be comparable to similarly titled measures used by other companies.
Contact:
Media: | Phylicia Middleton (702) 936-5216 |
Investors: | Harry Hagerty (702) 938-1740 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||
Adjusted EBITDA Reconciliation: | 2022 | 2021 | 2022 | 2021 | |||||||||
Net (loss) income | $ | (1,115,641) | $ | 550,455 | $ | (1,129,603) | $ | 639,192 | |||||
Interest expense | 1,697,435 | 140,142 | 3,384,457 | 321,052 | |||||||||
Share redemption consideration | - | 195,482 | - | 390,964 | |||||||||
Interest income | (2,259) | (388) | (4,492) | (771) | |||||||||
Depreciation and amortization | 725,258 | 720,488 | 1,449,720 | 1,437,742 | |||||||||
Share-based compensation | 315,408 | 441,444 | 625,410 | 758,084 | |||||||||
Foreign currency exchange loss (gain) | 174,638 | (11,355) | 234,901 | (2,271) | |||||||||
Change in fair value of interest rate swap liability | - | (16,187) | - | (66,009) | |||||||||
Provision for income taxes | 194,977 | 47,136 | 53,003 | 28,186 | |||||||||
Severance expense | 6,750 | - | 28,477 | 3,750 | |||||||||
Special project expense (benefit) - Triangulum | - | 79,317 | (86,959) | 296,227 | |||||||||
Special project expense - Other | 361,821 | 893 | 476,904 | 33,419 | |||||||||
Adjusted EBITDA | $ | 2,358,387 | $ | 2,147,427 | $ | 5,031,818 | $ | 3,839,565 |
Currency Reconciliation - Q2 2022 | |||||||||||||
Realized | Actual | Realized | Pro Forma | ||||||||||
Revenue in | Exchange | Reporting | Revenue in | Exchange | Reporting | ||||||||
Local | Rate | Currency | Local | Rate | Currency | ||||||||
Currency | Q2 2022 | Revenue | Currency | Q2 2021 | Revenue | ||||||||
EUR | € | 1,351,616 | $ | 1.11 | $ | 1,493,892 | € | 1,351,616 | $ | 1.19 | $ | 1,608,423 | |
GBP | £ | 598,009 | $ | 1.27 | $ | 761,739 | £ | 598,009 | $ | 1.40 | $ | 837,213 | |
USD | $ | 3,420,564 | $ | 1.00 | $ | 3,420,564 | $ | 3,420,564 | $ | 1.00 | $ | 3,420,564 | |
$ | 5,676,195 | $ | 5,866,200 | ||||||||||
Currency Reconciliation - 1H 2022 | |||||||||||||
Realized | Actual | Realized | Pro Forma | ||||||||||
Revenue in | Exchange | Reporting | Revenue in | Exchange | Reporting | ||||||||
Local | Rate | Currency | Local | Rate | Currency | ||||||||
Currency | 1H 2022 | Revenue | Currency | 1H 2021 | Revenue | ||||||||
EUR | € | 2,993,518 | $ | 1.13 | $ | 3,373,581 | € | 2,993,518 | $ | 1.21 | $ | 3,622,157 | |
GBP | £ | 1,273,821 | $ | 1.31 | $ | 1,671,219 | £ | 1,273,821 | $ | 1.39 | $ | 1,770,611 | |
USD | $ | 6,549,994 | $ | 1.00 | $ | 6,549,994 | $ | 6,549,994 | $ | 1.00 | $ | 6,549,994 | |
$ | 11,594,794 | $ | 11,942,762 | ||||||||||
1 Includes current portion.
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