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Scout Gaming AB cites that more ‘transformative work’ is required for the company to become a profitable cash-generating business.
The Nasdaq Nordic listed real money fantasy sports software supplier saw its full-year 2022 net losses stand at SEK 60m (- €5.5m), with bottom-line results reflecting a 27% decrease on FY2021 losses of SEK 82m (-€7.4m).
The narrowing of year losses was primarily attributed to Scout Gaming applying strict cost reduction measures that saw the company halve its staff headcount from 125-to-64 employees – as group operating expenses were reduced from SEK 122m to 94m (€8.3m).
Applying cost reduction measures, Scout Gaming registered a FY2022 deficit in headline revenues to SEK 25m, down 20% on FY2021 comparative results of SEK 32m.
The downturn in corporate revenues reflected the company tightening its B2B contracts, in which it terminated non-effective partnerships, which reduced its B2B portfolio to 13 remaining clients – “eight which are active and the remaining under integration”.
Elsewhere, the firm’s B2C unit saw revenues decrease by 47% to SEK 11.7m (FY2021: SEK22m) – as Scout Gaming reduced investment in the unit’s flagship FanTeam brand, which is currently under review “to generate profitable growth under controlled measures.”
Taking on board a new business model, Scout Gaming saw its FY2022 EBITDA reduced to SEK 68m, down 19% on 2021 comparative results of SEK 84m.
2022 financial developments saw the company raise SEK 101m via a share issue settlement, a transaction that diluted the group’s shareholding by approximately 90%.
Scout Gaming governance detailed that the transaction was necessary to see the business through its ongoing corporate transformation to apply new cost controls.
Acting CEO Niklas Jönsson commented: “To continue the transition to become a profitable company and to create shareholder value a lot of work remains, more efficiencies to achieve and sharp focus and engagement from all of us in the organisation is required.
“As we execute on our plans a profitable cash generative company is a possibility and a target, even if more transformative work is needed. I am determined to continue this fight.”
