GiG rides high ahead of big split decision

Gaming Innovation Group (GiG) states that it is on track to declare 2023 as its best year in business, following the results and achievements of a record breaking Q2 trading performance.

Publishing its latest corporate update, GiG achieved ‘all-time high’ Q2 2023 group revenues of €31m, up 40% on corresponding 2022 results of €22m.

The headline growth of the igaming media and sportsbook technology provider was further underscored by a 68% surge in adjusted EBITDA to €14m (Q2 2022: €8.3m).

The all-time earnings result was further strengthened by GiG maintaining a Q2 EBITDA margin at 45% – reflecting progress towards achieving the headline target of generating a 50% margin from business activities.

A breakdown of unit performance saw GiG Media declare a record breaking Q2 revenue result of €21.7m, up 47% on corresponding 2022 results of €14.8m, combined with an EBITDA of €10.3m.

Media growth reflected ‘operational and commercial strides’ as the unit registered 109,400 First Time Depositors (FTDs) during the Q2 period (+38%).

Bolstering GiG’s media portfolio, new property AskGamblers (acquired in Q1) posted a ‘45% revenue upsurge and 40% increase in new customer’ under its new ownership.

Of significance, GiG noted an improved diversification in revenue and earnings results, as its Platform and Sportsbook unit achieved revenues of €9.3m (Q2 2022: €7.8m).

Period trading saw GiG complete the successful migration of all GiG legacy Sportsbook clients to the Sportnco solution, helping the Platform and Sportsbook unit deliver a Q2 EBITDA of €3.7m.

The commercial capacity of GiG Platform and Sportsbook will be broadened by securing new wagering licences in the US states of Pennsylvania and Maryland, and a B2B supplier licence for Sweden.

Group CEO Richard Brown detailed his satisfaction at Q2 trading results, which emphasised the company’s focus on scalability and efficiency.

He said: “The second quarter of 2023 has proven another step forward for Gaming Innovation Group, with the business reaching another all-time high in revenues, increasing 40% year-over-year to over €31m.

“Not only am I pleased with the growth of the revenues but our focus on scalability and efficiency continues to move forward with an adjusted EBITDA of €14m with a margin of 45%, progressing well towards our long-term financial target of a +50% margin, and significant EBIT growth of 173% year-over-year.”

Year-to-date, GiG tracks consolidated revenues of €60m, up 44% on YTD 2022 results of €41m.  YTD EBITDA stands at €25m up 75% on 2022 EBITDA of €14.2m, attributed to an EBITDA margin of 41.8%

The group’s operating costs have risen by 20% to €21.4m, as YTD expenses reflect Sportnco integration costs and acquisition of AskGamblers.

Maintaining 2023’s record breaking momentum, the company forecasts revenues between €125-130m and an adjusted EBITDA margin ranging from 47-50%.

As announced in Q1, GIG has launched a strategic review of the business to elevate profits for shareholders in which a potential split of some units is anticipated for the first half of 2024, awaiting shareholder approval.

Brown concluded: “Progress towards the strategic review has moved well and we believe operationally the group will be ready to execute the planned spin off by year end, targeting execution, dependent on market conditions, in the first half of 2024.

“We now look into the second half of the year with total focus on ensuring strong growth mechanics, continued operational improvement and long-term scalability for GiG. I truly believe there is a strong and clear path to continued success for the business units both operationally and strategically and we are fixated on achieving it.”