Gentoo Media Inc · OMXSTO:G2M
Gentoo Media — GiG (Gaming Innovation Group) — Q1 2019 Earnings Presentation
30 slides from Gentoo Media's earnings presentation, Feb 6, 2019
Slide 1: Q1 2019
Q1 2019 6 Feb 2019
Slide 2: Today's presenter
Today’s presenter “Opening up iGaming, to make it Robin Reed fair and fun for all” CEO
Slide 3: Outline
Outline • Overview • Highlights • Strategic & Business Update • Outlook • Q/A 3
Slide 4: GiG overview
GiG overview iGaming solutions based on innovative technology ~700 No of Employees Offices in Malta, Denmark, Gibraltar, Norway, Spain, USA 2012 2015 Present GiG founded Listed on the Dual-listing on Nasdaq Stockholm Licences in Malta, UK, Oslo Stock New Jersey, Germany exchange S-H, Sweden, Spain (
Slide 5: Underlying market growth & offline to online growth
Underlying market growth & offline to online growth CAGR Total Market 2018e - 2023e 2.5% CAGR Total Market 2003 - 2017 3.6% 5
Slide 6: GiG: iGaming solutions based on innovative technology
GiG: iGaming solutions based on innovative technology Products & services throughout the entire iGaming value chain The iGaming value chain Platform Services Content & Ancillary Marketing Operators Services Sports Betting, Media In-house Gaming Technical Platform Games & Ancillary Services Operators
Slide 7: Product categories & services
Product categories & services • In GiG we operate within two product categories: Casino and Sports. • We produce our own content such as Odds and Games, we build our own backend, we develop our own front end and we have a media network for distribution. • These are built as products for Rizk, our ca
Slide 8: The Global Operator and Partner for strong brands in iGaming
“The Global Operator and Partner for strong brands in iGaming”
Slide 9: Highlights
Highlights Transformational quarter with increased regulation and taxation, positive outlook and many opportunities • All-Time-High revenues in Media, continued solid and stable growth trend and largest contribution to group profits • Initial revenue impact from Sweden absorbed by March • Omni-chann
Slide 10: Stable development
Stable development 12 months rolling revenues 12 months rolling EBITDA EUR million EUR million 10
Slide 11: Q1 Financial Highlights
Q1 Financial Highlights €32.4m €6.4m €8.6m €13.3m €4.1m Revenues Cost of sales Marketing Other opex EBITDA -13% Y/Y -6% Y/Y -28% Y/Y -7% Y/Y -5% Y/Y 11
Slide 12: Strategic Update
Strategic Update GiG
Slide 13: Strategic focus areas
Strategic focus areas Strategic intent and development: • Stable growth in high margin media business • Expansion into high margin, low entry barrier markets with B2C operators • Long-term sustainability through increased share of regulated markets • Accelerate growth and reach through B2B turnkey p
Slide 14: B2C update
B2C update Strategic review in 2018 yielding positive results • Fewer and larger brands • Improved EBITDA despite reduced revenues • Growth in major brand Rizk (71% of B2C revenues) • Focus on Rizk for Casino and Guts under development for Sports Betting • Re-investing marketing spend in core and ne
Slide 15: B2B update
B2B update • Media Services’ stable profit generation continues to enable investments for growth • Awarded the top 5 position at EGR’s Power Affiliates list (up 7 places from 2018) • Opportunity to grow both Paid media and Publishing in current and new markets such as North & LatAm and Asia • Sports
Slide 16: Operations
Operations Continued strong focus on recruiting, training and empowering the best leadership Headcount – end of quarter Headcount distribution 742 734 706 700 695 Q1-18 Q2-18 Q3-18 Q4-18 Q1-19 16
Slide 17: Sustainability
Sustainability In April, GiG published its inaugural Sustainability Report covering the Company’s key focus areas: “GiG builds a sustainable business to provide a fair and fun gambling environment for all stakeholders.” Initiatives in Q1 2019: • GiG formed a trade body in Norway in collaboration wit
Slide 18: Business Update
Business Update GiG
Slide 19: Gaming operators (B2C)
Gaming operators (B2C) EUR million 25.4 25.8 24.2 24.4 20.2 • Transformational regulatory and market conditions • EBITDA improved from €0.1m to €1.1m YoY • Rizk represents 71% of B2C revenues with a growth of 34% from Q1 2018 • Marketing costs decreased by 28% from Q1 1.4 0.8 1.1 2018 and represente
Slide 20: Media services (B2B)
Media services (B2B) EUR million 9.0 8.7 8.7 8.2 8.4 • ATH revenues increased by 10% compared to Q1 2018 – all organic 5.2 • 34,408 (32,382) FTD’s referred, 13% to own 4.9 4.4 4.7 4.3 brands and platform clients • The paid model, representing 15% of Media revenues, regained profitability in Q1 • 57%
Slide 21: Platform services (B2B)
Platform services (B2B) EUR million • Agreement signed with Megalotto to support its 7.2 6.8 6.8 entry and growth in the Lottery vertical 6.3 • Revenues decreased mainly due to the termination of a major customer negatively 4.9 impacting revenues in Q1 by ca €2 million • EBITDA impacted by negative
Slide 22: Sports betting services (B2B)
Sports betting services (B2B) EUR million 0.6 0.5 • Full omni-channel product launched in New 0.3 Jersey with partner Hard Rock in February 0.2 0.2 • Current burn-rate to be reduced throughout 2019 • Profitability expected from H1 2020 driven by promoting the Guts brand on sports betting, further de
Slide 23: Outlook
Outlook • Launch Rizk in Spain in Q3, initiating marketing in Q4 • Launch and market Rizk in selected Asian markets from Q2 and LatAm in H2 • Stable development and high margins for Media • Sign and launch one large B2B Turnkey contract in H1 • Launch sportsbook portfolio on Guts to position for gro
Slide 24: Q/A
Q/A GiG
Slide 25: Appendix
Appendix GiG
Slide 26: Largest shareholders
Largest shareholders Shareholder # shares % Bryggen Holding AS 11 817 839 13.1 % Swedbank Robur Ny Teknik 8 300 000 9.2 % Super Innovative Limited 6 446 427 7.2 % Andre Lavold 4 672 582 5.0 % Henrik Persson Ekdahl 4 522 582 5.0 % Hans Michael Hansen 4 360 445 4.8 % Skandinaviska Enskilda Banken nom.
Slide 27: Income statement
Income statement Condensed Statements of Operations in EUR 1 000 (Unaudited) Q1 2019 Q1 2018 2018 Revenues 32 423 37 339 151 372 Cost of sales 6 447 6 850 27 358 Gross profit 25 976 30 489 124 014 Gross profit margin 80% 82% 82% Marketing expenses 8 582 11 863 47 247 One-off expenses - - 2 619 Other
Slide 28: Cash flow
Cash flow In EUR 1 000 Q1 2019 Q1 2018 2018 Cash flow from operating activities 2 629 2 010 12 484 Cash flow from investment activities -4 180 -3 490 -12 386 Cash flow from financing activities - - 2 374 Translation (loss)/gain -32 86 133 Fair value movements 40 26 -15 Net change in cash and cash eq
Slide 29: Balance sheet
Balance sheet Condensed Balance Sheet in EUR 1 000 (Unaudited) 31 March 2019 31 March 2018 31 Dec 2018 Assets Goodwill 69 547 69 543 69 570 Intangibles assets 66 163 90 216 69 253 Deposits and other non-current assets 15 141 7 940 8 061 Total non-current assets 150 851 167 699 146 884 Prepaid and ot
Slide 30: Strong cash position
Strong cash position 2.6 14.7 0.0 0.0 13.1 -4.2 Cash and cash Cash flow from Cash flow from Cash flow from Translation gain Cash and cash equivalents at operating activities investment financing activities and fair value equivalents at 31 Dec 2018 activities movements 31 March 2019 30
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