GIG prepares for future as “full service provider” after strong Q3

GIG prepares for future as “full service provider” after strong Q3

Tuesday, November 6, 2018 Posted by News Team
Financial
Suppler signed first poker and sportsbook supply agreements during reporting period

Gaming Innovation Group (GIG) chief executive Robin Reed has talked up his company’s future prospects after completing its efforts to offer a solution for all iGaming verticals during the third quarter of 2018. 

Revenue for the period ended September 30th was up 21% year-on-year to €37.3m, with the majority coming from GIG’s customer-facing business.

The B2C division generated €24.4m, up 11% year-on-year, with 44% of this total coming from regulator and soon-to-be regulated markets. The vast majority (73%) came from Nordic markets, with a further 4% coming from Western Europe, 18% from central Europe and the remaining 5% from non-core territories.

This was complemented by a further €15.4m from GIG’s B2B business, up 33% from Q3 2018. The Media Services division, comprising affiliate and third-party marketing solutions, generated €8.4m of total B2B revenue, referring 29,288 first-time depositors to operators in the quarter. 

A further €6.8 came from GIG’s platform business GIG Core, with four new brands launching on the system in Q3. There are now 37 brands active on the platform in total, including GIG’s 7 proprietary brands. 

Sports betting services, which are now reported as a stand-alone division, contributed a further €0.2m. During the quarter GIG signed its first external sportsbook supply agreement, with the MRG-owned 11.lv. 

MRG’s core Mr Green brand also became the first operator to sign up for GIG’s compliance tool GIG Comply during the quarter. 

Among a range of other strategic achievements in the quarter, the company launched the first proprietary game from its GIG Games studio, signed its first poker supply deal, and inked sportsbook supply agreements with Hard Rock International and Metal Casino. 

“In the third quarter, we have delivered the last building blocks to our ecosystem, our own games and omni-channel solution, to cover all verticals in iGaming,” GIG chief executive Reed said. “We have created a base from where now, with full force, we can drive forward as the full service provider which every company serious about iGaming must be part of. 

“GiG sees strong interest for its services and products with an increasingly healthy pipeline of opportunities.”

The company eliminated €2.6m of the total revenue, though did not give reasons for doing so. 

Cost of sales for the quarter rose 28% year-on-year to €6.3m, with gaming taxes for the three-month period amounting to €1.2m, or 3.1% of total revenue. As a result gross profit amounted to €30.9m, with marketing expenses falling to €10.6m, down 11% from Q3 2017. 

Other operating expenses jumped 40% to €15.3m, with personnel expenses climbing to €10.0m. 

Earnings before interest, tax, depreciation and amortisation came in at €5.0m, a 66% increase from the prior year, largely as a result of increased gross profit and lower marketing spend. 

GIG posted a net loss of €2.6m for the quarter, resulting primarily from foreign exchange losses and interest of €1.2m from the company’s bond.  

Looking ahead to the final quarter of the year, Reed said: “We have a pipeline of opportunities and ambitious geographical expansion plans to build on our key strengths, both towards our full year 2018 targets and to accelerate both our roster of customers and iGaming solutions from our ecosystem from 2019 onwards.”

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