Gambling.com Group Limited, a leading provider of digital marketing services active exclusively in the global online gambling industry, today announced its operating and financial results for the second quarter ended June 30, 2021.

Second Quarter 2021 Financial Highlights

·         Revenue of $10.4 million; grew 66% compared to $6.3 million in the same period for the prior year

·         Net income of $2.4 million, or $0.08 per diluted share, compared to a net loss of $0.4 million, or a loss of $0.02 per diluted share, in the same period for the prior year

·         Adjusted EBITDA of $5.5 million; grew 46% compared to $3.8 million in the same period for the prior year, representing an Adjusted EBITDA margin of 53%[1]

·         Free cash flow of $3.1 million; decreased 3% compared to $3.2 million in the same period for the prior year[2]

Second Quarter 2021 Business Highlights

·         Completed redomiciliation from Malta to the Channel Island of Jersey in May

·         Successful launches of EmpireStakes.com, BetArizona.com and IllinoisBet.com which provides bettors with trusted and up-to-date state-specific gambling information to help them place safe and secure legal wagers

·         Completed acquisition of two domain portfolios suitable for targeting the US market

·         Subsequent to quarter end, completed successful public listing of common shares on the Nasdaq Global Market under the ticker symbol “GAMB”

·         Subsequent to quarter end, announced appointment of Mr. Daniel D’Arrigo to Board of Directors

“Our second quarter results (which were our first interim financial results as a public company) were highlighted by continued strong top-line growth, and, based on our Adjusted EBITDA margins, we areamong the most profitable names in the online gambling industry,” said Charles Gillespie, Chief Executive Officer and co-founder of Gambling.com Group. “Since our founding in 2006, we have built an affiliate marketing powerhouse with recognizable brands around the globe. Players trust our services to help them find a safe, fun and legal betting experience while our B2C operator clients utilize our best-in-class technology platform to support their increasingly important customer acquisition initiatives. We are incredibly excited about the next step in this journey as a public company and look forward to sharing the success with our new investors.”

Second Quarter 2021 vs. Second Quarter 2020 Financial Highlights

 

THREE MONTHS ENDED

JUNE 30,

CHANGE

2021

2020

$

%

(in thousands USD, except for share and per share data, unaudited)

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) DATA

Revenue

$

10,392

$

6,259

$

4,133

66.0

%

Operating expenses

(7,235

)

(2,997

)

(4,238

)

141.4

%

Operating profit

3,157

3,262

(105

)

(3.2

)%

Income (loss) before tax

3,027

(128

)

3,155

n/m

Net income (loss) for the period attributable to the equity holders

$

2,445

$

(428

)

$

2,873

n/m

Net income (loss) per share attributable to ordinary shareholders, basic

0.09

(0.02

)

n/m

n/m

Net income (loss) per share attributable to ordinary shareholders, diluted

0.08

(0.02

)

n/m

n/m

 

n/m = not meaningful

 

THREE MONTHS ENDED

JUNE 30,

CHANGE

2021

2020

$

%

(in thousands USD, unaudited)

NON-IFRS FINANCIAL MEASURES

Adjusted EBITDA

5,518

3,779

1,739

46.0

%

Adjusted EBITDA Margin

53.1

%

60.4

%

n/m

n/m

Free Cash Flow

3,122

3,229

(107

)

(3.3

)%

 

n/m = not meaningful

 

THREE MONTHS ENDED

JUNE 30,

CHANGE

2021

2020

Amount

%

(in thousands, unaudited)

OTHER SUPPLEMENTAL DATA

New Depositing Customers (1)

26

25

1

3.8

%

 

(1) 

We define New Depositing Customers, or NDCs, as unique referral of a player from our system to one of our customers that satisfied an agreed metric (typically making a deposit above a minimum threshold) with the customer, thereby triggering the right to a commission for us.

AS OF

JUNE 30,

AS OF

DECEMBER 31,

CHANGE

2021

2020

$

%

(Unaudited)

(in thousands, USD)

CONSOLIDATED STATEMENTS OF FINANCIAL POSITION DATA

Cash and cash equivalents

$

17,168

$

8,225

$

8,943

108.7

%

Working capital (2)

17,203

10,059

7,144

71.0

%

Total assets

55,139

45,383

9,756

21.5

%

Total borrowings

6,062

5,960

102

1.7

%

Total liabilities

14,052

11,171

2,881

25.8

%

Total equity

41,087

34,212

6,875

20.1

%

 

(2) 

Working capital is defined as total current assets minus total current liabilities.

 

Revenue

Total revenue in the second quarter increased 66% to $10.4 million compared to $6.3 million in the comparable period in 2020. On a constant currency basis, revenue increased $3.5 million, or 52%.The increase was driven by improved monetization of NDCs that we attribute to a combination of technology improvements and changes in product and market mix. NDCs increased 4% to 26,000 compared to 25,000 in the prior year.

Our revenue disaggregated by market is as follows:

 

THREE MONTHS ENDED

JUNE 30,

CHANGE

2021

2020

$

%

(in thousands USD, unaudited)

U.K. and Ireland

$

5,410

$

3,489

$

1,921

55.1

%

Other Europe

2,822

969

1,853

191.2

%

North America

1,408

1,097

311

28.4

%

Rest of the world

752

704

48

6.8

%

Total revenues

$

10,392

$

6,259

$

4,133

66.0

%

 

Revenue increases were primarily driven by organic growth in our U.K. and Ireland, Other Europe, and North American markets.

Our revenue disaggregated by monetization is as follows:

 

THREE MONTHS ENDED

JUNE 30,

CHANGE

2021

2020

$

%

(in thousands USD, unaudited)

Hybrid commission

$

4,611

$

3,238

$

1,373

42.4

%

Revenue share commission

1,054

825

229

27.8

%

CPA commission

3,558

2,130

1,428

67.0

%

Other revenue

1,169

66

1,103

1,671.2

%

Total revenues

$

10,392

$

6,259

$

4,133

66.0

%

 

Revenue increases were driven primarily by additional Hybrid commission, CPA commission and Other revenue. The increase in Other revenue was driven primarily by bonuses related to achieving certain operator NDC performance targets in the quarter.

Our revenue disaggregated by product type from which it is derived is as follows:

THREE MONTHS ENDED

JUNE 30,

CHANGE

2021

2020

$

%

(in thousands USD, unaudited)

Casino

$

9,087

$

5,570

$

3,517

63.1

%

Sports

1,170

518

652

125.9

%

Other

135

171

(36

)

(21.1

)%

Total revenues

$

10,392

$

6,259

$

4,133

66.0

%

 

Revenue increases were driven by growth in revenue from casino and sports products.

Operating Expenses

 

THREE MONTHS ENDED

JUNE 30,

CHANGE

2021

2020

$

%

(in thousands USD, unaudited)

Sales and marketing expenses

$

3,144

$

1,598

1,546

96.7

%

Technology expenses

944

510

434

85.1

%

General and administrative expenses

3,387

875

2,512

287.1

%

Allowance for credit losses

(240

)

14

(254

)

n/m

Total operating expenses

$

7,235

$

2,997

4,238

141.4

%

 

n/m = not meaningful

Total operating expenses increased by $4.2 million to $7.2 million compared to $3.0 million in the prior year. On a constant currency basis, operating expenses increased by $3.9 million to $7.2 million compared to $3.3 million in the prior year.

Sales and Marketing expenses totaled $3.1 million, an increase of $1.5 million compared to 2020, driven by increased wages and salary expenses associated with increased headcount as well as investments in the Company’s organic growth initiatives.

Technology expenses totaled $0.9 million compared to $0.5 million in 2020, mainly the result of higher wages and salary expense associated with increased headcount partially offset by capitalized development costs.

General and Administrative expenses totaled $3.4 million compared to $0.9 million in the prior year, mainly driven by non-recurring expenses related to the public offering totaling approximately $1.5 million and the expansion of the senior management team.

Earnings

Adjusted EBITDA increased by 46% to $5.5 million compared to $3.8 million in the prior year representing an Adjusted EBITDA margin of 53%.

Operating profit in the second quarter decreased 3% to $3.2 million compared to $3.3 million in 2020. Operating profit was affected by non-recurring expenses related to the public offering totaling approximately $1.5 million.

Net income in the second quarter totaled $2.4 million, or $0.08 per diluted share, compared to a net loss of $0.4 million, or a loss of $0.02 per diluted share, in the prior year. The increase was the result of significant growth in pre-tax income compared to the prior year.

Free Cash-flow

Total cash generated from operations of $4.7 million increased 47% compared to $3.2 million in the prior year. The increase was driven by improved operating profit and net income compared to the prior year. Free cash flow, totaled $3.1 million compared to $3.2 million in the prior year. The decline was the result of increased capital expenditures consisting primarily  of the acquisition of two domain portfolios, partially offset by the increase in cash generated from operations.

Balance Sheet

Cash balances as of June 30, 2021 totaled $17.2 million, an increase of $9.0 million compared to $8.2 million as of December 31, 2020. Working capital as of June 30, 2021 totaled $17.2 million, an increase of $7.1 million compared to $10.1 million as of December 31, 2020.

Total assets as of June 30, 2021 were $55.1 million compared to $45.4 million as of December 30, 2020. Total borrowings, including accrued interest, totaled $6.1 million compared to $6.0 million as of December 31, 2020. Total liabilities stood at $14.1 million compared to $11.2 million as of December 31, 2020.

Total equity as of June 30, 2021 was $41.1 million compared to $34.2 million as of December 31, 2020.

2021 – 2023 Financial Targets

Total Revenue Growth

˃ Average 40%

Adjusted EBITDA Margin[3]

≥ Average 40%

Leverage[4]

< Net Debt to Adjusted EBITDA 2.5x[5]

2021 Outlook

Elias Mark, Chief Financial Officer of Gambling.com Group, added, “Our financial results for the second quarter came in at the high end of our previously provided ranges as we reported strong growth in revenue, adjusted EBITDA, and net income compared to the prior year. We also continue to produce strong free cash flow and weremain in a solid financial position after the public offering last month. We are carrying encouraging momentum into the second half of the year. As a result, we are expecting to achieve or exceed our Revenue Growth target and Adjusted EBITDA margin target for the full year 2021 before the effects of any acquisitions and without incurring further borrowings.”