Gentoo Media Inc · OMXSTO:G2M
Gentoo Media — Gaming Innovation Group — Q2 2019 Earnings Presentation
31 slides from Gentoo Media's earnings presentation, Aug 14, 2019
Slide 1: Q2 2019 – 14 August 2019
Q2 2019 14 August 2019
Slide 2: Today's presenter
Q2 2019 - Quarterly Results Today’s presenter Robin Reed CEO 2
Slide 3: Outline
Q2 2019 - Quarterly Results Outline • Overview & Business Case • Highlights • Strategic & Business Update • Outlook • Q/A 3
Slide 4: GiG Overview & Business Case
Q2 2019 - Quarterly Results GiG Overview & Business Case Global technology provider of products and ~700 services in iGaming No of Employees • Online Gambling is an attractive industry with more than €50bn in revenues growing at 6% compound annual rate • The industry is being transformed as countrie
Slide 5: GiG: iGaming solutions based on innovative technology
Q2 2019 - Quarterly Results 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 &
Slide 6: The Global Operator and Partner for strong brands in iGaming
Q2 2019 - Quarterly Results “The Global Operator and Partner for strong brands in iGaming” 6
Slide 7: Stable development
Q2 2019 - Quarterly Results Stable development 12 months rolling revenues 12 months rolling EBITDA EUR million EUR million 7
Slide 8: Q2 Financial Highlights
Q2 2019 - Quarterly Results Q2 Financial Highlights €31m €6.6m €8.9m €13m €2.5m Revenues Cost of sales Marketing Other opex EBITDA -16% Y/Y +3% Y/Y -32% Y/Y -17% Y/Y +49% Y/Y 8
Slide 9: Q2 Operational Highlights
Q2 2019 - Quarterly Results Q2 Operational Highlights Positive outlook with many opportunities in both B2C and B2B • GiG entered a new continent, signing and launching a turnkey online casino with SkyCity Entertainment Group, the largest leisure, entertainment and tourism company in New Zealand • St
Slide 10: Strategic Update
Q2 2019 - Quarterly Results Strategic Update 10
Slide 11: Strategic focus areas
Q2 2019 - Quarterly Results Strategic focus areas Strategic intent: The global operator and partner for strong brands in iGaming • Enable cost and scale advantages for the industry by connecting operators, suppliers and end users through the GiG platform • Develop the technology and product to enabl
Slide 12: B2B update
Q2 2019 - Quarterly Results B2B update • GiG signed with New Zealand’s largest casino and entertainment group SkyCity Entertainment Group, to provide a fully managed online casino to consumers in New Zealand, the site was launched on 8 August 2019 • Healthy pipeline of potential customers supported
Slide 13: Highroller.com divested for €7 million
Q2 2019 - Quarterly Results Highroller.com divested for €7 million B2C brand Highroller divested • GiG is focusing marketing spend on Rizk.com in order to improve earnings quality by increasing brand equity in target markets • Highroller has been returning strong KPIs and is therefore divested to a
Slide 14: B2C development
Q2 2019 - Quarterly Results B2C development Strategic review in 2018 yielding positive results • Fewer and larger brands: now operating 4 brands • Improved EBITDA driven by lower marketing spend • Strong growth in the Group’s leading brand Rizk (73% of B2C revenues) Healthy margins and earnings qual
Slide 15: Sustainability
Q2 2019 - Quarterly Results Sustainability Sustainable and long-term profitable growth is at the core of all aspects of GiG’s corporate strategy. GiG focuses its sustainability strategy on areas most relevant to its business, at the heart of which is responsible gambling. Initiatives in Q2 2019: • C
Slide 16: Operations
Q2 2019 - Quarterly Results Operations Continued strong focus on recruiting, training and empowering the best leadership and team Headcount – end of quarter Headcount distribution 16
Slide 17: Business Update
Q2 2019 - Quarterly Results Business Update 17
Slide 18: Gaming operators (B2C)
Q2 2019 - Quarterly Results Gaming operators (B2C) EUR million • Revenues impacted by the Swedish market and lower than average casino margin • Rizk represents 73% of B2C revenues with a YoY growth of 17% • EBITDA improved YoY to €0.4m from €-2.8m • Marketing costs decreased YoY by 37% and represent
Slide 19: Media services (B2B)
Q2 2019 - Quarterly Results Media services (B2B) EUR million • Solid development, Q2 2018 was boosted by the football World Cup • 29,435 (31,445) FTD’s referred, 5% to own brands and platform customers • The paid model, representing 16% of Media revenues, regained profitability in Q1 and showed all-
Slide 20: Platform services (B2B)
Q2 2019 - Quarterly Results Platform services (B2B) EUR million • Revenues declined YoY due to the termination of a major customer impacting revenues in Q2 by ca €2.2 million • Short-term impact moving from the white label model to a turnkey partnership model to support land-based operators into dig
Slide 21: Sports betting services (B2B)
Q2 2019 - Quarterly Results Sports betting services (B2B) EUR million • Break even (incl contribution from B2C NGR) is expected in H1 2020 • 4 external customers live with GiG’s Sports Betting Services and 2 internal • Legacy sportsbook platform phased out with the migration of Guts Revenue EBITDA 2
Slide 22: Bond structure & loans
Q2 2019 - Quarterly Results Bond structure & loans Gaming Innovation Group Plc. issued a new SEK400 million senior secured bond with a SEK1,000 million borrowing limit on 28 June 2019. The bond matures in June 2022 and will be listed on Nasdaq Stockholm in H2 2019. SEK350 million of the new bond was
Slide 23: Guidance & Outlook
Q2 2019 - Quarterly Results Guidance & Outlook • Sequential growth in revenues and EBITDA in H2 2019 • Accelerate B2B sales, both turnkey solutions and modular sales • New Front End framework launched with SkyCity, migration of all GiG hosted brands to follow suit in coming quarters will improve eff
Slide 24: Q/A
Q2 2019 - Quarterly Results Q/A 24
Slide 25: Appendix
Q2 2019 - Quarterly Results Appendix 25
Slide 26: Largest shareholders July 2019
Q2 2019 - Quarterly Results Largest shareholders 31 July 2019 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 4,978,982 5.4 % Henrik Persson Ekdahl 4,522,582 5.0 % Hans Michael Hansen 4,360,44
Slide 27: Income statement
Income statement Q2 2019 - Quarterly Results Condensed Statements of Operations in EUR 1 000 (Unaudited) Q2 2019 Q2 2018 6M 2019 6M 2018 2018 Revenues 30 971 36 885 63 394 74 224 151 372 Cost of sales 6 574 6 364 13 021 13 214 27 358 Gross profit 24 397 30 521 50 373 61 010 124 014 Gross profit marg
Slide 28: Cash flow
Q2 2019 - Quarterly Results Cash flow In EUR 1 000 Q2 2019 Q2 2018 6M 2019 6M 2018 2018 Cash flow from operating activities 3 189 8 249 5 818 10 259 12 484 Cash flow from investment activities -3 469 -3 068 -7 649 -6 558 -12 386 Cash flow from financing activities 2 446 - 2 446 - 2 374 Translation (
Slide 29: Balance sheet
Q2 2019 - Quarterly Results Balance sheet Condensed Balance Sheet in EUR 1 000 (Unaudited) 30 June 2019 30 June 2018 31 Dec 2018 Assets Goodwill 69 525 69 653 69 570 Intangibles assets 63 012 88 217 69 253 Deposits and other non-current assets 26 208 8 175 8 061 Total non-current assets 158 745 166
Slide 30: Strong cash position
Q2 2019 - Quarterly Results Strong cash position 30
Slide 31: Legal disclaimer
Q2 2019 - Quarterly Results Legal disclaimer Gaming Innovation Group Inc. gives forecasts. Certain statements in this report presentation are forward-looking and the actual outcome may be materially different. In addition to the factors discussed, other factors could have an impact on actual outcome
Gaming Innovation Group — Q2 2019 Earnings Presentation on 6ix