Interactive
Canada – Bragg booms by 34.2 per cent as it accelerates new game releases
By Phil - 11 August 2022
Bragg Gaming’s revenue increased by 34.2 per cent to €20.8m (USD $21.3m) in the second quarter, setting a new quarterly record for the betting and gaming company.
Wagering revenue generated by customers of €4.2bn increased from €3.8bn, reflecting a change in product mix towards PAM, managed services and proprietary content, resulting in improved gross profit and Adjusted EBITDA.
Gross profit increased 65.5 per cent to €11.6m, reflecting higher revenue and a 1,060 basis point year-over-year margin improvement to a quarterly record 55.9 per cent.
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. The higher mix of iGaming revenues includes an increase in revenues from proprietary games which have no cost of sales.
“Our strong second quarter results include significant year-over-year growth, as well as quarterly-sequential improvements for revenue, gross profit, gross profit margin and Adjusted EBITDA,” said Yaniv Sherman, Chief Executive Officer for Bragg Gaming Group. “In the 2022 second quarter, we generated quarterly records for revenue of €20.8m, gross profit of €11.6m, gross profit margin of 55.9 per cent, and Adjusted EBITDA of €3.1m. Our operating momentum highlights our continued success in serving a growing base of customers in an expanding number of regulated global iGaming markets, with turnkey iGaming solutions that power their businesses, including proprietary and exclusive third-party content.
“Following the completion in June of our acquisition of Spin Games, Bragg possesses the product development capabilities, industry expertise and licensed footprint across Europe and North America to achieve further and consistent progress on our content and market expansion growth initiatives. Our content development and distribution efforts, led by our four in-house game studios, are focused on leveraging proprietary design, game mechanics and math capabilities to develop games that address local player preferences across European and North American markets. We expect to release approximately 22 proprietary games this year representing a 120 per cent increase from 2021, with our game development roadmap poised to accelerate our new game releases next year and beyond. In addition, we will supplement our internal game development efforts with agreements for Bragg to exclusively distribute games from established popular third-party studios. We expect our execution against our content development and distribution strategy will result in a higher level of desirable ‘real estate’ allocation on leading iGaming operators’ sites, leading to higher player engagement that drives further top-line growth and margin improvement.
“The North American iGaming market continues to grow. We expect to leverage our expertise and differentiated product and technology advantages to drive consistent growth with leading operators in these markets. This includes content localization and customization that addresses popular online and land-based themes.”
Mr. Sherman concluded, “Reflecting our strong performance through the first half of the year and our ongoing business momentum, we are raising our guidance for 2022 full year revenue and Adjusted EBITDA to new ranges of €76m and €10 to 11m respectively. As demonstrated by our operating results to-date in 2022, our success with these efforts is driving strong top-line growth and margin improvement, highlighting our ability to deliver near- and long-term shareholder value.”
