Gentoo Media Inc · OMXSTO:G2M
Gentoo Media — Gaming Innovation Group — Q1 2017 Earnings Presentation
32 slides from Gentoo Media's earnings presentation, May 2, 2017
Slide 1: Gaming Innovation Group Q1 2017
Gaming Innovation Group Q1 2017 02 May 2017 Robin Reed, CEO Tore Formo, CFO
Slide 2: An iGaming eco-system
GAMING INNOVATION GROUP AN iGAMING ECO-SYSTEM APPLICATION ECONOMY MARKETING CLIENT ECO-SYSTEMS ‘GAMING SERVICES PROVIDED. 878 CLIENTS, DUNDER oan PAYMENT SERVICES PROVIDED. oo. Scoe 1820 BRANDS a0 TECHNOLOGY _
Slide 3: Creating a leading iGaming company
Creating a leading iGaming company 23.1 Revenues in EUR million 21.5 14.5 9.7 19 64 48 3.7 j |] Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017
Slide 4: Highlights Q1 2017
Highlights Q1 2017 e All time high revenues for the group - maintaining full year guiding of EUR 120 million e Securing funding for future growth through SEK 400 million bond issue e Largest affiliate acquisition to date - creating a leading affiliate company e All time high Revenues for iGamingClou
Slide 5: Financial highlights Q1 2017
Financial highlights Q1 2017 REVENUES COST OF SALES |MARKETING EXPENSES | OTHER OPEX €23.1M | €4.4M €10.9M | €8.1M (7% Q/Q) (8% Q/Q) (56% Q/Q) (24% Q/Q) (193% Y/Y] (237% Y/Y) (227% Y/Y) (144% Y/Y) EBITDA €(0.4)M 3.9M (Q4 16) (0.1M) (Q1 16)
Slide 6: Operational update
Operational update
Slide 7: B2C segment
B2C The B2C segment include Gaming Innovation Groups gaming operators EUR million Q1 2017 Q1 2016 5 - Revenues up 178% Y/Y and 3% Q/Q Revenue 18.5 6.7 42.4 Marketing cost 1.4 34 20.0 - Betit contributed with EUR 7.5 mill. in Q1, EBITDA (2.5) (0.7) (1.1) unchanged from Q4 tes » Q1 EBITDA margins affe
Slide 8: Betit growth back on track after migration
Betit growth back on track after migration Revenue dip during migration Increasing revenues post migration EURmillion EURmillion 12 000 4500 4000 10 000 3500 8000 3.000 2500 6000 2000 4000 1500 1000 2000 500 0 0 Q2 Q3 Q4 Qi Q2 G3 Q4 ai G2 G3 Q4 QI Q2 @ a Ql Jan.17 Feb. 17 Mar. 17 Apr.17 2013 2013 20
Slide 9: High growth strategy - targeting regulated markets
High growth strategy - targeting regulated markets 4 » Focus on growth in core markets: Nordics: Nordics, Central- and Western Europe 61% of B2C revenues: - Inthe process of obtaining Danish license (ETA Q4) - Targeting Dutch and Swedish licenses when available (01.01.2019) Western Europe: 9 - Reven
Slide 10: Months payback on marketing
7 months payback on marketing Marketing return on investment 2016 (Of Q1 17 marketing 70% up-front and 30% perpetual revenue share] 2 3 i im 4 Jan Feb Revenues covering marketing expenses within 7 months 17:17 15 ” 14 "1 7 _ i a | Mar Apr May Jun Jul = Aggregated NGR from new customers NGR: Net Gami
Slide 11: High correlation between EBITDA margin and marketing spend
High correlation between EBITDA margin and marketing spend Marketing spend vs EBITDA margin +» Largest investment to date ( EUR 7.6m) towards up front marketing in Q1 - Main focus on Nordics, increasing focus on UK 4% 42% - Revenue share constant, up front marketing increased 104% from Q4 2016 35% 3
Slide 12: Increased deposits from active players
Increased deposits from active players Active real money players Deposits B2C revenues 1000 players . EURmillion EUR million 184* 189 73.2* 17.9* 18.5° 66.9* 6.0 82 82 76 31.1 8.2 27.7 22.8 11.4 - 82 - mg - 24.0 26.1 64 Q12016 =Q22016 Q32016 Q42016 12017 =GIG = Historic Betlt players on 100% basis B
Slide 13: Developing the next generation online casino
Developing the next generation online casino e Codenamed Brand X e Designing the ultimate user experience - Social, personalised and gamified - All technology, design, sound effects and html5 content is proprietary - Atruly differentiated and future oriented casino - Music and RNG games outsourced e
Slide 14: Q1 2016 - Q1 2017
• • - • - Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017
Slide 15: Live / Not live
Live Not live Q2 15 Q3 15 Q4 15 Q1 16 Q2 16 Q3 16 Q4 16 Q1 17
Slide 16: Innovation Labs - lead generation in iGaming
Innovation Labs- lead generation in iGaming Two main revenue models Innovation Labs (IL) is a performance marketing agency referring paying users to affiliated operators on two business models 1. Perpetual revenue share - IL receive a perpetual revenue share for every first time depositor (“FTD”) -
Slide 17: Internal/iGC brand vs external brands
14 000 12 000 10 000 8 000 6 000 4 000 2 000 0 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Internal/iGC brand External brands
Slide 18: Financial update
Financial update
Slide 19: Secured funding for future growth
Secured funding for future growth e SEK 400 million senior secured bond, with a SEK 1,250 million borrowing limit e Acquire and invest into marketing businesses and distribution channels e Increase GIG’s traffic handling capability in a rapidly expanding eco-system - Higher volumes benefit all stake
Slide 20: Revenue and EBITDA by quarter
23.1 21.5 14.5 9.7 7.9 3.9 1.0 1.1 -0.1 -0.4 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017
Slide 21: Cash Flow development
Cash Flow development EUR 1 000 41016 6035 153 51312 e Strong cash balance - Cash increased by EUR 45.3 million, includes EUR 41.0 million from bond financing Cash flow from financing activities Cash flow from investment activities Cash andcash Cash flow from equivalents at 31 operating activities D
Slide 22: Assets, equity and liabilities
EUR million 140 120 100 80 60 40 20 0 Assets Equity and liabilities
Slide 23: Summary and outlook
Summary and outlook
Slide 24: Outlook
Outlook e The company is well positioned for organic and acquired growth across all three major business areas e Reiterates guiding of EUR 120 million in revenues for 2017 e Re-designing iGC platform architecture to support the scale of any operator in the industry - Timeline of 18 months, improveme
Slide 25: Q&A - 2nd quarter 2017
Q&A 2nd quarter 2017 08.08.2017
Slide 26: Appendix
Appendix
Slide 27: Largest shareholders as of April 2017
Largest shareholders as of 30 April 2017 Shareholder #shares % Optimizer Invest Ltd 131 173 297 16.0% Bryggen Holding AS 104 446 123 12.8% Swedbank Robur Fonder - Ny Teknik 65 566 502 8.0% Super Innovative Limited (Robin Reed] 58 414 881 7.1% Hans Michael Hansen 39101 744 4.8% Frode Fagerli 36 001 1
Slide 28: Income statement
Income statement Condensed Statements of Operations in EUR 1 000 (Unaudited) Q1 2017 Q1 2016 2016 Revenues 23 074 7 886 53 605 Cost of sales 4367 1294 9 285 Gross profit 18 708 6592 44 320 Gross profit margin 81% 84% 83% Marketing expenses 10 930 3.339 19.094 Other operating expenses 8129 3.325 1941
Slide 29: Cash flow
Cash flow Q1 2017 Q1 2016 2016 In EUR 1 000 Cash flow from operating activities 6061 -1 603 2221 Cash flow from investment activities -1951 -73 -5 061 Cash flow from financing activities 41016 3 805 7052 Translation gain 153 -36 -200 Net change in cash and cash equivalents 45 277 2218 3943 Cash and
Slide 30: Balance sheet
Balance sheet Condensed Balance Sheet in EUR 1 000 (Unaudited) 31.03.17 31.03.16 2016 Assets Goodwill 64.119 15 691 63.955 Intangibles and other non-current assets 42 958 12 948 43 638 Total non-current assets 107 077 28 639 107 593 Other current assets 12 166 8 682 12 680 Cash and cash equivalents
Slide 31: Several markets moving towards regulation
Several markets moving towards regulation Unregulated markets = @ 606 Regulated markets 0 SGSEQ000e Taxation » No tax for offshore operators » Revenue not officially generated in the country Tax ranging from ~10-25% of Gross Gaming Revenue (GGR]} Differences in tax rates between countries and type o
Slide 32: Gaming Innovation Group Inc. structure
32 GAMING INNOVATION GROUP INC. DELAWARE GAMING INNOVATION GROUP LTD. GO Listed on the Oslo Bors B2B B2C AFFILIATE MARKETING CLOUD SERVICES CANDID GAMING LTD. ZECURE GAMING LTD. Innovation Labs Ltd. iGaming Cloud Ltd. | Malta } | Malta } (Malta) {Malta} @ lan (®vetspin RIZK INNOVATION GO —— Labs iGA
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