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Galaxy Gaming Reports Q2 2022 Financial Results

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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 $5,676K
  • Adjusted EBITDA increased 10% to $2,358K
  • Net loss of $(1,116)K vs. net income of 550K

1H 2022 vs. 1H 2021

  • Revenue increased 28% to $11,595K
  • Adjusted EBITDA increased 31% to $5,032K
  • Net loss of $(1,130)K vs. net income of 639K

Balance Sheet Changes (vs. December 31, 2021)

  • Cash increased 7% to $17,250K
  • Total long-term debt1 (gross) decreased to $59,868K from $60,500K
  • Stockholders’ deficit increased to $(18,0297)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 $190K in revenue in the quarter (as compared to what we would have realized using the rates that applied in Q2 2021). We have seen very little benefit from the new rates on the expense side, as most of our expenses are denominated in dollars. The increase in inflation has affected us as we have seen significant increases in travel expenses and are having to offer increased salaries and wages to hire new employees and to retain existing ones. Finally, the floating interest rate on which our long-term debt is based has risen by 116 basis points from January to July.”

“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 24% in the quarter and the 32% in the first half as compared to the same periods in 2021.  And we have some exciting things happening in the second half. In Galaxy Core (our land-based business), one of our high-end UK customers will launch the first three-meter progressive, with a top side bet of £100 – the first in the world. We started installations of our new Triton 1.0 progressive platform in the US in the third quarter and will demonstrate Triton 2.0 at G2E in October.  Galaxy Digital (our online business) continues to do well. With our partner SPIN Games, we launched the first online 21+3 Progressive, and we will release our own online roulette and baccarat titles in the second half of 2022 to complement our strong position in blackjack side bets.   I’m excited about the fundamentals of our business and am confident we’ll manage through the wider macroeconomic issues. We focus on the things we can control.”

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Despite the headwinds, our liquidity and balance sheet remain in good shape,” continued Hagerty. “We had more than $17 million in cash at quarter-end and were comfortably in compliance with the net leverage covenant in the Fortress Credit Agreement.

“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 $22.5-$23.5 million and Adjusted EBITDA in a range of $10-11 million.   This forecast assumes no new lockdowns from COVID-19, no impact to our business from the war in Ukraine, and no economic recession.”

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

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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

 

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    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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Galaxy Gaming® Highlights Galaxy Operating System™ and EZ Baccarat® at IGA 2024

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LAS VEGAS, April 02, 2024 (GLOBE NEWSWIRE) — Galaxy Gaming, Inc. (OTC: GLXZ), the world’s leading independent developer and distributor of casino table games and technology, will showcase their innovative new table game operating system and player-favorite table games at this year’s Indian Gaming Association (“IGA”) Trade Show & Convention from April 10 – 11 in booth 770 at Anaheim Convention Center.

President and CEO of Galaxy Gaming, Matt Reback shared his excitement, stating, “We look forward to showcasing our premier table games and innovative solutions with our tribal partners at IGA 2024. We’re proud to offer the largest library of category-leading brands that players love enhanced by technology to elevate their gaming experience. This powerful combination can transform the gaming floor for operators.”

Galaxy Operating System™ – The Smartest Table Management System

Upgrade your casino floor with Galaxy Operating System (GOS), the cutting-edge game management system of the future. Boasting innovative progressive jackpot options, eye-catching Nebula LED sensors, and groundbreaking digital tracking capabilities, GOS is a pioneer and the best way for operators to offer enhanced table games on their floors.

GOS’ flexible electronic bonusing platform powers the world’s first Dynamic Progressive. Unlike any other progressive, Dynamic Progressive blends our most popular games with an exhilarating experience for those players looking for a thrill by adding volatility to the game without changing the play experience on the player-favorite base game. Visit the Galaxy Gaming booth to see the latest version of Dynamic Progressive complete with new themes, animations, and celebrations.

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The Smart Bet – Galaxy Gaming’s Ultimate Table Games Library

Boasting the most robust table games library in the industry, Galaxy Gaming fuses established classics with exciting novelties. Level up your casino floor with player favorites like 21+3®, Perfect Pairs®, and Heads Up Hold’em® now amplified with Dynamic Progressive™, powered by GOS™. Don’t miss the #1 commission-free baccarat brand in North America, EZ Baccarat® now featuring the exciting new Panda 8 and Dragon 7 Progressive – the newest baccarat progressive on the market offering an individual jackpot.

Also featured in-booth is Roulette Up™, an inventive game with an optional side bet and progressive wager where players can wager that the outcome will provide an increasing sequence from each spin. Tracking is now seamless, with GOS powering digital tracking for the Roulette Up progressive wager.

Operators are invited to explore the possibilities at booth 770 and discover how Galaxy can elevate their gaming operations.

About Galaxy Gaming 
Headquartered in Las Vegas, Nevada, Galaxy Gaming (galaxygaming.com) develops and distributes innovative games, bonusing systems, and technology solutions to physical and online casinos worldwide. Galaxy Gaming offers games proven to perform developed by gaming experts and backed by the highest level of customer support. Galaxy Gaming Digital is the world’s leading licensor of proprietary table games to the online gaming industry. Connect with Galaxy Gaming on Facebook, YouTube, Instagram, and Twitter. 

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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, including changes in gaming related and non-gaming related statutes and regulations that affect the revenues of our customers in land-based casino and, online casino markets, have its games approved by relevant jurisdictions, and adapt to changes resulting from the COVID-19 or other pandemics including without limitation, government imposed shut downs, travel restrictions and supply chain interruptions, unfavorable economic conditions in the US and worldwide, our level of indebtedness, restrictions and covenants in our loan agreement, dependence on major customers, protection of intellectual property and our ability to license the intellectual property rights of third parties, failure to maintain the integrity of our information technology systems, including without limitation, cyber-attacks or other failures in our telecommunications or information technology systems, or those of our collaborators, third-party logistics providers, distributors or other contractors or consultants, could result in information theft, data corruption and significant disruption of our business, 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 report. Galaxy Gaming expressly disclaims any obligation to update or revise any forward-looking statements, whether because of new information, future events or otherwise.

Actual results could differ materially from those expressed or implied in our forward-looking statements. Our future financial condition and results of operations, as well as any forward-looking statements, are subject to change and to inherent known and unknown risks and uncertainties. You should not assume at any point in the future that the forward-looking statements in this report are still valid. We do not intend, and undertake no obligation, to update our forward-looking statements to reflect future events or circumstances.

Contact: 

Media: 
Phylicia Middleton (702) 938-1753 
Investors:         
Harry Hagerty (702) 938-1740 

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Galaxy Gaming Announces its Annual Meeting of Stockholders For 2024-

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LAS VEGAS, March 27, 2024 (GLOBE NEWSWIRE) — Galaxy Gaming, Inc. (OTCQB: GLXZ) (“Galaxy” or the “Company”), a developer and distributor of online and land-based casino table games and enhanced systems, announced today that its annual meeting of stockholders will be held virtually on May 29, 2024, for stockholders of record as of April 2, 2024. The Notice of Stockholders Meeting will be provided to stockholders of record as of April 2, 2024, in accordance with applicable statutes and regulations.

Forward-Looking Statements

Certain statements in this release may constitute forward-looking statements, which involve a number of risks and uncertainties. Galaxy cautions readers that any forward-looking information is not a guarantee of future performance and that actual results could differ materially from those contained in the forward-looking information due to a number of factors, including those listed from time to time in reports that Galaxy files with the Securities and Exchange Commission.

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 casinos worldwide. In addition, directly and 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.

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Contact:

Media:   Phylicia Middleton (702) 936-5216
Investors:   Harry Hagerty (702) 938-1740

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Galaxy Gaming Provides Update to Earnings Release

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LAS VEGAS, March 26, 2024 (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 corrections to certain financial information provided in the earnings release issued on March 25, 2024.

In the table that provided guidance for fiscal 2024, the growth rate for Net Revenue was miscalculated. The calculated growth rate at the midpoint of the guidance range is 6.1%, not the 2.4% that was in the original release. A corrected table is presented below.

(mm) 2023 Actual   2024 Range   Midpoint Change
Recurring License Revenue $ 28.0     $34.0 – $35.0   23.2 %
Sale of Perpetual Licenses   3.7     1.0 – 1.5   (66.2 )%
Gross Revenue $ 31.7     $35.0 – $36.5   12.8 %
Royalties Netted against Gross Revenue   (3.9 )   (6.0 – 6.5)   60.3 %
Net Revenue $ 27.8     $29.0 – $30.0   6.1 %
           
Adjusted EBITDA4 $ 10.6     $12.0 – $13.0   17.9 %
 

In the Disaggregation of Revenue table in Exhibit 1, Recurring License Revenue in GG Digital for Q4 2022 was incorrect. That error flowed through to the consolidated revenue figures for that period. A corrected Exhibit 1 is attached hereto.

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, including changes in gaming related and non-gaming related statutes and regulations that affect the revenues of our customers in land-based casino and, online casino markets, have its games approved by relevant jurisdictions, and adapt to changes resulting from the COVID-19 or other pandemics including without limitation, government imposed shut downs, travel restrictions and supply chain interruptions, unfavorable economic conditions in the US and worldwide, our level of indebtedness, restrictions and covenants in our loan agreement, dependence on major customers, protection of intellectual property and our ability to license the intellectual property rights of third parties, failure to maintain the integrity of our information technology systems, including without limitation, cyber-attacks or other failures in our telecommunications or information technology systems, or those of our collaborators, third-party logistics providers, distributors or other contractors or consultants, could result in information theft, data corruption and significant disruption of our business, 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 report. Galaxy Gaming expressly disclaims any obligation to update or revise any forward-looking statements, whether because of new information, future events or otherwise.

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Actual results could differ materially from those expressed or implied in our forward-looking statements. Our future financial condition and results of operations, as well as any forward-looking statements, are subject to change and to inherent known and unknown risks and uncertainties. You should not assume at any point in the future that the forward-looking statements in this report are still valid. We do not intend, and undertake no obligation, to update our forward-looking statements to reflect future events or circumstances.

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 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

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Exhibit 1
 
Disaggregation of Revenue
 
(mm) Q4 23 Q4 22 FY 23 FY 22
Consolidated        
Recurring License Revenue $ 8.0   $ 6.5   $ 28.0   $ 25.6  
Sale of Perpetual Licenses   0.4     0.2     3.7     0.3  
Gross Revenue $ 8.4   $ 6.7   $ 31.7   $ 25.9  
Royalties Netted against Gross Revenue   (1.7 )   (0.8 )   (3.9 )   (2.5 )
Net Revenue $ 6.7   $ 5.9   $ 27.8   $ 23.4  
         
GG Core        
Recurring License Revenue $ 5.0   $ 3.7   $ 16.6   $ 15.1  
Sale of Perpetual Licenses   0.4     0.2     3.7     0.3  
Gross Revenue $ 5.4   $ 3.9   $ 20.3   $ 15.4  
Royalties Netted against Gross Revenue   (0.8 )       (0.9 )    
Net Revenue $ 4.6   $ 3.9   $ 19.4   $ 15.4  
         
GG Digital        
Recurring License Revenue $ 3.0   $ 2.8   $ 11.4   $ 10.5  
Royalties Netted against Gross Revenue   (0.9 )   (0.8 )   (3.0 )   (2.5 )
Net Revenue $ 2.1   $ 2.0   $ 8.4   $ 8.0  
 

4 It is not possible to provide a reconciliation of Adjusted EBITDA to Net Income without undue burden, as certain factors such as interest rates and tax rates are not knowable.

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