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Gambling.com Group Revenue Grows 63% to a Q2 Record of $26.0 Million, Net Income Rises to $0.3 Million, and Adjusted EBITDA Increases to a Q2 Record of $9.4 Million

Raises 2023 Revenue Guidance to $100-$104 Million and Adjusted EBITDA Guidance to $36-$40 Million; Mid-Points Imply Revenue Growth of 33% and Adjusted EBITDA Growth of 58% over the Full Year 2022

Gambling.com Group Limited (Nasdaq: GAMB) (“Gambling.com Group” or the “Company”), a leading provider of digital marketing services for the global online gambling industry, today reported record second quarter financial results for the three months ended June 30, 2023. The Company also increased its guidance for full-year revenue and Adjusted EBITDA.

Second Quarter 2023 vs. Second Quarter 2022 Financial Highlights

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

 

Three Months Ended June 30,

 

Change

 

2023

 

2022

 

%

Revenue

25,972

 

 

15,924

 

 

63

%

Net income for the period attributable to shareholders (1)

278

 

 

56

 

 

396

%

Net income per share attributable to shareholders, diluted (1)

0.01

 

 

0.00

 

 

100

%

Net income margin (1)

1

%

 

%

 

 

Adjusted net income for the period attributable to shareholders (1)(2)

6,535

 

 

3,065

 

 

113

%

Adjusted net income per share attributable to shareholders, diluted (1)(2)

0.17

 

 

0.08

 

 

113

%

Adjusted EBITDA (1)(2)

9,424

 

 

3,617

 

 

161

%

Adjusted EBITDA Margin (1)(2)

36

%

 

23

%

 

 

Cash flows generated by operating activities

4,586

 

 

3,368

 

 

36

%

Free Cash Flow (2)

8,526

 

 

2,822

 

 

202

%

(1) For the three months ended June 30, 2023, Net income and Net income per share include, and Adjusted net income and Adjusted net income per share exclude, adjustments related to the Company's 2022 acquisitions of RotoWire and BonusFinder of $6.1 million, or $0.17 per share. Similarly, these adjustments totaled $3.0 million, or $0.08, per share for the three months ended June 30, 2022. See “Supplemental Information - Non-IFRS Financial Measures” and the tables at the end of this release for an explanation of the adjustments.

(2) Represents a non-IFRS measure. See “Supplemental Information - Non-IFRS Financial Measures” and the tables at the end of this release for reconciliations to the comparable IFRS numbers.

Charles Gillespie, Chief Executive Officer and Co-Founder of Gambling.com Group, commented, “The business performed phenomenally in the second quarter with record operating results reflecting another quarter of significant organic revenue growth and strong Free Cash Flow generation. The growth highlights our success in scaling our North American operations as well as continued growth in our more established markets. New depositing customers rose 60% year-over-year to over 91,000, which helped drive a 63% revenue increase to $26.0 million, 161% growth in Adjusted EBITDA to $9.4 million, and $8.5 million of Free Cash Flow.

“Despite North America already being our largest reporting market, it still represents a significant growth opportunity for Gambling.com Group and we remain very confident in our ability to continue to increase market share in existing states as they continue to grow. This expected growth will be complemented by an overall expansion of the addressable market as new states such as North Carolina and Kentucky come online with sports betting, and iGaming is authorized in additional states. As we continue to scale our North American operations, Gambling.com Group will benefit from other attractive near- and long-term growth drivers, including valuable media partnerships with leading domestic digital media publishers, McClatchy and Gannett, and the significant long-term global opportunity provided by the recently launched Casinos.com. In addition, we are well positioned to continue growing in our more established markets where we continue to take market share and have signed our first international media partnership with The Independent for the U.K. market.

“With each quarter of consistent profitable organic growth delivered by Gambling.com Group, we are demonstrating the benefits of what we believe to be the most attractive business model in the industry as we leverage our many growth drivers and capital efficiency. Our excellence in SEO and proprietary data science allows us to consistently generate top-line growth, Adjusted EBITDA margins that exceed 30%, and strong Free Cash Flow conversion. As a result, we are confident Gambling.com Group will continue to create added value for our shareholders, clients and our valued team members.”

Second Quarter 2023 and Recent Business Highlights

  • Grew North American revenue 115% to $13.4 million
  • Delivered more than 91,000 new depositing customers
  • Entered into first international media partnership with The Independent, one of the U.K.’s largest digital media publishers with more than 20 million unique monthly users
  • Negotiated a final, deferred consideration payment of €18 million related the acquisition of BonusFinder in exchange for the early termination of the earn-out period, providing the Company with the ability to accelerate the realization of synergies
  • Repurchased 77,683 ordinary shares at an average price of $9.83 per share

Elias Mark, Chief Financial Officer of Gambling.com Group, added, “The operating leverage we generated on 63% year-over-year revenue growth and 161% Adjusted EBITDA growth in the second quarter grew Free Cash Flow growth of 202% to $8.5 million. As a result, we have significant flexibility to simultaneously continue to strategically invest in growth opportunities, including the buildout of Casinos.com and the development of our media partnerships, and to evaluate strategic transactions that we believe create new shareholder value. Reflecting our strong operating results through the first six months of the year, which outperformed our expectations, and our confidence for continued strong performance over the balance of 2023, we are raising our full year revenue and Adjusted EBITDA outlook with the mid-point of the new ranges representing year-over-year growth of 33% and 58%, respectively.”

2023 Outlook

The Company raised its full-year 2023 revenue guidance to between $100 million and $104 million, and Adjusted EBITDA guidance to between $36 million and $40 million. The Company’s guidance assumes:

  • Kentucky goes live on September 28th with online sports betting
  • Beyond Kentucky, no online sports betting or iGaming going live in any additional North American markets for the balance of 2023
  • No contribution from any new acquisitions
  • New investments throughout 2023 for the development of Casinos.com and support to our media partners, including Gannett, McClatchy and The Independent
  • An average EUR/USD exchange rate of 1.095 throughout the remainder of 2023

First Half 2023 vs. First Half 2022 Financial Highlights

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

 

Six Months Ended June 30,

 

Change

 

2023

 

2022

 

%

Revenue

52,664

 

 

35,509

 

 

48

%

Net income for the period attributable to shareholders (1)

6,873

 

 

4,542

 

 

51

%

Net income per share attributable to shareholders, diluted (1)

0.18

 

 

0.12

 

 

50

%

Net income margin (1)

13

%

 

13

%

 

 

Adjusted net income for the period attributable to shareholders (1)(2)

14,086

 

 

7,551

 

 

87

%

Adjusted net income per share attributable to shareholders, diluted (1)(2)

0.37

 

 

0.21

 

 

76

%

Adjusted EBITDA (1)(2)

20,097

 

 

10,719

 

 

87

%

Adjusted EBITDA Margin (1)(2)

38

%

 

30

%

 

 

Cash flows generated by operating activities

11,669

 

 

6,944

 

 

68

%

Free Cash Flow (2)

14,732

 

 

4,186

 

 

252

%

(1) For the six months ended June 30, 2023, Net income and Net income per share include, and Adjusted net income and Adjusted net income per share exclude, adjustments related to the Company's 2022 acquisitions of RotoWire and BonusFinder of $7.0 million, or $0.19 per share. Similarly, these adjustments totaled $3.0 million, or $0.09, per share for the six months ended June 30, 2022. See “Supplemental Information - Non-IFRS Financial Measures” and the tables at the end of this release for an explanation of the adjustments.

(2) Represents a non-IFRS measure. See “Supplemental Information - Non-IFRS Financial Measures” and the tables at the end of this release for reconciliations to the comparable IFRS numbers.

Conference Call Details

Date/Time:

Thursday, August 17, 2023, at 8:00 a.m. ET

Webcast:

https://www.webcast-eqs.com/gamb20230817/en

U.S. Toll-Free Dial In:

877-407-0890

International Dial In:

+1-201-389-0918

To access, please dial in approximately 10 minutes before the start of the call. An archived webcast of the conference call will also be available in the News & Events section of the Company’s website at gambling.com/corporate/investors/news-events. Information contained on the Company’s website is not incorporated into this press release.

About Gambling.com Group Limited

Gambling.com Group Limited (Nasdaq: GAMB) (the "Group") is a multi-award-winning performance marketing company and a leading provider of digital marketing services active in the online gambling industry. Founded in 2006, the Group has offices globally, primarily operating in the United States and Ireland. Through its proprietary technology platform, the Group publishes a portfolio of premier branded websites including Gambling.com, Bookies.com, Casinos.com and RotoWire.com. Gambling.com Group owns and operates more than 50 websites in seven languages across 15 national markets covering all aspects of the online gambling industry, including iGaming and sports betting, and the fantasy sports industry.

Use of Non-IFRS Measures

This press release contains certain non-IFRS financial measures, such as Adjusted Net Income, EBITDA, Adjusted EBITDA, Adjusted EBITDA Margin, Free Cash Flow, and related ratios. See “Supplemental Information - Non-IFRS Financial Measures” and the tables at the end of this release for an explanation of the adjustments and reconciliations to the comparable IFRS numbers.

Cautionary Note Concerning Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995, that relate to our current expectations and views of future events. All statements other than statements of historical facts contained in this press release, including statements relating to our expectation of continued growth in the North American market and other established markets, whether strategic transactions will create new shareholder value, and our 2023 outlook, are all forward-looking statements. These statements represent our opinions, expectations, beliefs, intentions, estimates or strategies regarding the future, which may not be realized. In some cases, you can identify forward-looking statements by terms such as “believe,” “may,” “estimate,” “continue,” “anticipate,” “intend,” “should,” “plan,” “expect,” “predict,” “potential,” “could,” “will,” “would,” “ongoing,” “future” or the negative of these terms or other similar expressions that are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Forward-looking statements are based largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy, short-term and long-term business operations and objectives and financial needs. These forward-looking statements involve known and unknown risks, uncertainties, contingencies, changes in circumstances that are difficult to predict and other important factors that may cause our actual results, performance, or achievements to be materially and/or significantly different from any future results, performance or achievements expressed or implied by the forward-looking statement. Important factors that could cause actual results to differ materially from our expectations are discussed under “Item 3. Key Information - Risk Factors” in Gambling.com Group’s annual report filed on Form 20-F for the year ended December 31, 2022 with the U.S. Securities and Exchange Commission (the “SEC”) on March 23, 2023, and Gambling.com Group’s other filings with the SEC as such factors may be updated from time to time. Any forward-looking statements contained in this press release speak only as of the date hereof and accordingly undue reliance should not be placed on such statements. Gambling.com Group disclaims any obligation or undertaking to update or revise any forward-looking statements contained in this press release, whether as a result of new information, future events or otherwise, other than to the extent required by applicable law.

Consolidated Statements of Comprehensive Income (Loss) (Unaudited)

(USD in thousands, except per share amounts)

The following table details the consolidated statements of comprehensive income for the three and six months ended June 30, 2023 and 2022 in the Company's reporting currency and constant currency.

 

Reporting Currency

 

Constant

Currency

 

Reporting Currency

 

Constant

Currency

 

Three Months Ended

June 30,

Change

 

Change

 

Six months ended

June 30,

Change

 

Change

 

2023

 

2022

%

 

%

 

2023

 

2022

%

 

%

Revenue

25,972

 

 

15,924

 

63

%

 

60

%

 

52,664

 

 

35,509

 

48

%

 

49

%

Cost of sales

(896

)

 

(495

)

81

%

 

77

%

 

(1,887

)

 

(1,724

)

9

%

 

10

%

Gross profit

25,076

 

 

15,429

 

63

%

 

59

%

 

50,777

 

 

33,785

 

50

%

 

51

%

Sales and marketing expenses

(8,403

)

 

(8,454

)

(1

)%

 

(2

)%

 

(16,441

)

 

(15,816

)

4

%

 

4

%

Technology expenses

(2,447

)

 

(1,499

)

63

%

 

60

%

 

(4,670

)

 

(2,862

)

63

%

 

64

%

General and administrative expenses

(7,286

)

 

(4,804

)

52

%

 

49

%

 

(13,067

)

 

(9,632

)

36

%

 

36

%

Movements in credit losses allowance

(118

)

 

(72

)

64

%

 

60

%

 

(767

)

 

(597

)

28

%

 

29

%

Fair value movement on contingent consideration

(6,087

)

 

(2,849

)

114

%

 

110

%

 

(6,939

)

 

(2,849

)

144

%

 

145

%

Operating profit (loss)

735

 

 

(2,249

)

133

%

 

132

%

 

8,893

 

 

2,029

 

338

%

 

340

%

Finance income

606

 

 

3,491

 

(83

)%

 

(83

)%

 

706

 

 

4,319

 

(84

)%

 

(84

)%

Finance expenses

(420

)

 

(1,056

)

(60

)%

 

(61

)%

 

(983

)

 

(1,307

)

(25

)%

 

(24

)%

Income before tax

921

 

 

186

 

395

%

 

385

%

 

8,616

 

 

5,041

 

71

%

 

72

%

Income tax charge

(643

)

 

(130

)

395

%

 

386

%

 

(1,743

)

 

(499

)

249

%

 

251

%

Net income for the period attributable to shareholders

278

 

 

56

 

396

%

 

388

%

 

6,873

 

 

4,542

 

51

%

 

52

%

Other comprehensive income (loss)

 

 

 

 

 

 

 

 

 

 

 

 

 

Exchange differences on translating foreign currencies

(676

)

 

(6,559

)

(90

)%

 

(90

)%

 

692

 

 

(7,928

)

(109

)%

 

(109

)%

Total comprehensive income for the period attributable to shareholders

(398

)

 

(6,503

)

94

%

 

94

%

 

7,565

 

 

(3,386

)

323

%

 

325

%

 

Consolidated Statements of Financial Position (Unaudited)

(USD in thousands)

 

 

JUNE 30,

2023

 

DECEMBER 31,

2022

ASSETS

 

 

 

Non-current assets

 

 

 

Property and equipment

805

 

 

714

 

Right-of-use assets

1,615

 

 

1,818

 

Intangible assets

89,928

 

 

88,521

 

Deferred compensation cost

 

 

29

 

Deferred tax asset

6,220

 

 

5,832

 

Total non-current assets

98,568

 

 

96,914

 

Current assets

 

 

 

Trade and other receivables

13,249

 

 

12,222

 

Inventories

13

 

 

75

 

Cash and cash equivalents

31,311

 

 

29,664

 

Total current assets

44,573

 

 

41,961

 

Total assets

143,141

 

 

138,875

 

EQUITY AND LIABILITIES

 

 

 

Equity

 

 

 

Share capital

 

 

 

Capital reserve

73,952

 

 

63,723

 

Treasury shares

(1,107

)

 

(348

)

Share options and warrants reserve

6,009

 

 

4,411

 

Foreign exchange translation reserve

(6,383

)

 

(7,075

)

Retained earnings

33,271

 

 

26,398

 

Total equity

105,742

 

 

87,109

 

Non-current liabilities

 

 

 

Other payables

 

 

290

 

Deferred consideration

 

 

4,774

 

Contingent consideration

 

 

11,297

 

Lease liability

1,347

 

 

1,518

 

Deferred tax liability

2,212

 

 

2,179

 

Total non-current liabilities

3,559

 

 

20,058

 

Current liabilities

 

 

 

Trade and other payables

6,896

 

 

6,342

 

Deferred income

1,784

 

 

1,692

 

Deferred consideration

23,380

 

 

2,800

 

Contingent consideration

 

 

19,378

 

Other liability

282

 

 

226

 

Lease liability

542

 

 

554

 

Income tax payable

956

 

 

716

 

Total current liabilities

33,840

 

 

31,708

 

Total liabilities

37,399

 

 

51,766

 

Total equity and liabilities

143,141

 

 

138,875

 

 

Consolidated Statements of Cash Flows (Unaudited)

(USD in thousands)

 

 

Three Months Ended

June 30,

 

Six Months Ended

June 30,

 

2023

 

2022

 

2023

 

2022

 

 

 

 

 

 

 

 

Cash flow from operating activities

 

 

 

 

 

 

 

Income before tax

921

 

 

186

 

 

8,616

 

 

5,041

 

Finance expenses (income), net

(187

)

 

(2,435

)

 

277

 

 

(3,012

)

Adjustments for non-cash items:

 

 

 

 

 

 

 

Depreciation and amortization

480

 

 

1,952

 

 

1,025

 

 

3,778

 

Movements in credit loss allowance

118

 

 

72

 

 

767

 

 

597

 

Fair value movement on contingent consideration

6,087

 

 

2,849

 

 

6,939

 

 

2,849

 

Share-based payment expense

1,253

 

 

885

 

 

2,099

 

 

1,609

 

Warrants repurchased

 

 

(800

)

 

 

 

(800

)

Income tax paid

(1,899

)

 

(783

)

 

(1,789

)

 

(783

)

Payment of contingent consideration

(4,621

)

 

 

 

(4,621

)

 

 

Cash flows from operating activities before changes in working capital

2,152

 

 

1,926

 

 

13,313

 

 

9,279

 

Changes in working capital

 

 

 

 

 

 

 

Trade and other receivables

1,971

 

 

2,456

 

 

(1,892

)

 

(2,639

)

Trade and other payables

401

 

 

(1,014

)

 

186

 

 

304

 

Inventories

62

 

 

 

 

62

 

 

 

Cash flows generated by operating activities

4,586

 

 

3,368

 

 

11,669

 

 

6,944

 

Cash flows from investing activities

 

 

 

 

 

 

 

Acquisition of property and equipment

(51

)

 

(99

)

 

(204

)

 

(242

)

Acquisition of intangible assets

(630

)

 

(447

)

 

(1,354

)

 

(2,516

)

Acquisition of subsidiaries, net of cash acquired

 

 

(4,114

)

 

 

 

(23,409

)

Payment of deferred consideration

 

 

 

 

(2,390

)

 

 

Payment of contingent consideration

(5,557

)

 

 

 

(5,557

)

 

 

Cash flows used in investing activities

(6,238

)

 

(4,660

)

 

(9,505

)

 

(26,167

)

Cash flows from financing activities

 

 

 

 

 

 

 

Treasury shares acquired

(759

)

 

 

 

(759

)

 

 

Interest payment attributable to third party borrowings

 

 

 

 

 

 

(120

)

Interest payment attributable to deferred consideration settled

 

 

 

 

(110

)

 

 

Principal paid on lease liability

(94

)

 

(79

)

 

(199

)

 

(165

)

Interest paid on lease liability

(40

)

 

(45

)

 

(87

)

 

(95

)

Cash flows used in financing activities

(893

)

 

(124

)

 

(1,155

)

 

(380

)

Net movement in cash and cash equivalents

(2,545

)

 

(1,416

)

 

1,009

 

 

(19,603

)

Cash and cash equivalents at the beginning of the period

33,564

 

 

33,069

 

 

29,664

 

 

51,047

 

Net foreign exchange differences on cash and cash equivalents

292

 

 

(551

)

 

638

 

 

(342

)

Cash and cash equivalents at the end of the period

31,311

 

 

31,102

 

 

31,311

 

 

31,102

 

 

Earnings Per Share

Below is a reconciliation of basic and diluted earnings per share as presented in the Consolidated Statement of Comprehensive Income for the period specified, stated in USD thousands, except per share amounts:

 

Three Months Ended

June 30,

 

Reporting

Currency

Change

 

Constant

Currency

Change

 

Six Months Ended

June 30,

 

Reporting

Currency

Change

 

Constant

Currency

Change

 

2023

 

2022

 

%

 

%

 

2023

 

2022

 

%

 

%

Net income for the period attributable to shareholders

278

 

56

 

396

%

 

388

%

 

6,873

 

4,542

 

51

%

 

52

%

Weighted-average number of ordinary shares, basic

37,082,794

 

35,443,258

 

5

%

 

5

%

 

36,757,214

 

35,176,469

 

4

%

 

4

%

Net income per share attributable to shareholders, basic

0.01

 

0.00

 

100

%

 

100

%

 

0.19

 

0.13

 

46

%

 

46

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income for the period attributable to shareholders

278

 

56

 

396

%

 

388

%

 

6,873

 

4,542

 

51

%

 

52

%

Weighted-average number of ordinary shares, diluted

38,462,183

 

36,534,091

 

5

%

 

5

%

 

38,123,560

 

36,608,017

 

4

%

 

4

%

Net income per share attributable to shareholders, diluted

0.01

 

0.00

 

100

%

 

100

%

 

0.18

 

0.12

 

50

%

 

50

%

Supplemental Information

Rounding

We have made rounding adjustments to some of the figures included in the discussion and analysis of our financial condition and results of operations together with our consolidated financial statements and the related notes thereto. Accordingly, numerical figures shown as totals in some tables may not be an arithmetic aggregation of the figures that preceded them.

Non-IFRS Financial Measures

Management uses several financial measures, both IFRS and non-IFRS financial measures in analyzing and assessing the overall performance of the business and for making operational decisions.

Adjusted Net Income and Adjusted Net Income Per Share

Adjusted net income is a non-IFRS financial measure defined as net income attributable to equity holders excluding the fair value gain or loss related to contingent consideration, unwinding of deferred consideration, and certain employee bonuses related to acquisitions. Adjusted net income per diluted share is a non-IFRS financial measure defined as adjusted net income attributable to equity holders divided by the diluted weighted average number of common shares outstanding.

We believe adjusted net income and adjusted net income per diluted share are useful to our management as a measure of comparative performance from period to period as these measures remove the effect of the fair value gain or loss related to the contingent consideration, unwinding of deferred consideration, and certain employee bonuses, all associated with our acquisitions, during the limited period where these items are incurred. We expect to incur gains or losses related to the contingent consideration and expenses related to the unwinding of deferred consideration and employee bonuses until December 2023. See Note 5 of the consolidated financial statements for the three months ended June 30, 2023 for a description of the contingent and deferred considerations associated with our acquisitions.

Below is a reconciliation to Adjusted net income attributable to equity holders and Adjusted net income per share, diluted from net income for the period attributable to the equity holders and net income per share attributed to ordinary shareholders, diluted as presented in the Consolidated Statements of Comprehensive Income (Loss) and for the period specified stated in the Company's reporting currency and constant currency:

 

Reporting Currency

 

Constant

Currency

Reporting Currency

 

Constant

Currency

 

Three Months Ended

June 30,

 

Change

 

Change

Six Months Ended

June 30,

 

Change

 

Change

 

2023

 

2022

 

%

 

%

2023

 

2022

 

%

 

%

Revenue

25,972

 

 

15,924

 

 

63

%

 

60

%

52,664

 

 

35,509

 

 

48

%

 

49

%

Net income for the period attributable to shareholders

278

 

 

56

 

 

396

%

 

388

%

6,873

 

 

4,542

 

 

51

%

 

52

%

Net income margin

1

%

 

%

 

 

 

 

13

%

 

13

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income for the period attributable to shareholders

278

 

 

56

 

 

396

%

 

388

%

6,873

 

 

4,542

 

 

51

%

 

52

%

Fair value movement on contingent consideration (1)

6,087

 

 

2,849

 

 

114

%

 

110

%

6,939

 

 

2,849

 

 

144

%

 

145

%

Unwinding of deferred consideration (1)

55

 

 

160

 

 

(66

)%

 

(66

)%

109

 

 

160

 

 

(32

)%

 

(31

)%

Employees' bonuses related to acquisition (1)

115

 

 

0

 

 

100

%

 

100

%

165

 

 

0

 

 

100

%

 

100

%

Adjusted net income for the period attributable to shareholders

6,535

 

 

3,065

 

 

113

%

 

109

%

14,086

 

 

7,551

 

 

87

%

 

87

%

Net income per share attributable to shareholders, basic

0.01

 

 

0.00

 

 

100

%

 

100

%

0.19

 

 

0.13

 

 

46

%

 

46

%

Effect of adjustments for fair value movements on contingent consideration, basic

0.16

 

 

0.08

 

 

100

%

 

100

%

0.19

 

 

0.08

 

 

138

%

 

138

%

Effect of adjustments for unwinding on deferred consideration, basic

0.00

 

 

0.00

 

 

%

 

%

0.00

 

 

0.00

 

 

%

 

%

Effect of adjustments for bonuses related to acquisition, basic

0.00

 

 

0.00

 

 

%

 

%

0.00

 

 

0.00

 

 

%

 

%

Adjusted net income per share attributable to shareholders, basic

0.18

 

 

0.09

 

 

100

%

 

100

%

0.38

 

 

0.21

 

 

81

%

 

81

%

Net income per share attributable to ordinary shareholders, diluted

0.01

 

 

0.00

 

 

100

%

 

100

%

0.18

 

 

0.12

 

 

50

%

 

50

%

Adjusted net income per share attributable to shareholders, diluted

0.17

 

 

0.08

 

 

113

%

 

89

%

0.37

 

 

0.21

 

 

76

%

 

76

%

(1) There is no tax impact from fair value movement on contingent consideration, unwinding of deferred consideration or employee bonuses related to acquisition.

EBITDA, Adjusted EBITDA and Adjusted EBITDA Margin

EBITDA is a non-IFRS financial measure defined as earnings excluding interest, income tax (charge) credit, depreciation, and amortization. Adjusted EBITDA is a non-IFRS financial measure defined as EBITDA adjusted to exclude the effect of non-recurring items, significant non-cash items, share-based payment expense, foreign exchange gains (losses), fair value of contingent consideration, and other items that our board of directors believes do not reflect the underlying performance of the business including acquisition related expenses, such as acquisition related costs and bonuses. Adjusted EBITDA Margin is a non-IFRS measure defined as Adjusted EBITDA as a percentage of revenue.

We believe Adjusted EBITDA and Adjusted EBITDA Margin are useful to our management team as a measure of comparative operating performance from period to period as those measures remove the effect of items not directly resulting from our core operations including effects that are generated by differences in capital structure, depreciation, tax effects and non-recurring events.

While we use Adjusted EBITDA and Adjusted EBITDA Margin as tools to enhance our understanding of certain aspects of our financial performance, we do not believe that Adjusted EBITDA and Adjusted EBITDA Margin are substitutes for, or superior to, the information provided by IFRS results. As such, the presentation of Adjusted EBITDA and Adjusted EBITDA Margin is not intended to be considered in isolation or as a substitute for any measure prepared in accordance with IFRS. The primary limitations associated with the use of Adjusted EBITDA and Adjusted EBITDA Margin as compared to IFRS results are that Adjusted EBITDA and Adjusted EBITDA Margin as we define them may not be comparable to similarly titled measures used by other companies in our industry and that Adjusted EBITDA and Adjusted EBITDA Margin may exclude financial information that some investors may consider important in evaluating our performance.

Below is a reconciliation to EBITDA, Adjusted EBITDA from net income for the period attributable to shareholders as presented in the Consolidated Statements of Comprehensive Income and for the period specified:

 

Reporting Currency

 

Constant

Currency

 

Reporting Currency

 

Constant

Currency

 

Three Months Ended

June 30,

 

Change

 

Change

 

Six Months Ended

June 30,

 

Change

 

Change

 

2023

 

2022

 

%

 

%

 

2023

 

2022

 

%

 

%

 

(USD in thousands)

 

 

 

 

(USD in thousands)

 

 

 

Net income for the period attributable to shareholders

278

 

 

56

 

 

396

%

 

388

%

 

6,873

 

4,542

 

 

51

%

 

52

%

Add back (deduct):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expenses on borrowings and lease liability

44

 

 

185

 

 

(76

)%

 

(77

)%

 

87

 

355

 

 

(75

)%

 

(75

)%

Income tax charge

643

 

 

130

 

 

395

%

 

386

%

 

1,743

 

499

 

 

249

%

 

251

%

Depreciation expense

63

 

 

44

 

 

43

%

 

41

%

 

120

 

87

 

 

38

%

 

39

%

Amortization expense

417

 

 

1,908

 

 

(78

)%

 

(79

)%

 

905

 

3,691

 

 

(75

)%

 

(75

)%

EBITDA

1,445

 

 

2,323

 

 

(38

)%

 

(39

)%

 

9,728

 

9,174

 

 

6

%

 

7

%

Share-based payment expense

1,253

 

 

885

 

 

42

%

 

39

%

 

2,099

 

1,609

 

 

30

%

 

31

%

Fair value movement on contingent consideration

6,087

 

 

2,849

 

 

114

%

 

110

%

 

6,939

 

2,849

 

 

144

%

 

145

%

Unwinding of deferred consideration

55

 

 

160

 

 

(66

)%

 

(66

)%

 

109

 

160

 

 

(32

)%

 

(32

)%

Foreign currency translation losses (gains), net

(303

)

 

(2,833

)

 

(89

)%

 

(90

)%

 

24

 

(3,606

)

 

(101

)%

 

(101

)%

Other finance results

18

 

 

53

 

 

(66

)%

 

(67

)%

 

57

 

79

 

 

(28

)%

 

(27

)%

Secondary offering related costs

733

 

 

 

 

100

%

 

100

%

 

733

 

 

 

100

%

 

100

%

Acquisition related costs (1)

21

 

 

180

 

 

(88

)%

 

(89

)%

 

243

 

454

 

 

(46

)%

 

(46

)%

Employees' bonuses related to acquisition

115

 

 

 

 

100

%

 

100

%

 

165

 

 

 

100

%

 

100

%

Adjusted EBITDA

9,424

 

 

3,617

 

 

161

%

 

156

%

 

20,097

 

10,719

 

 

87

%

 

89

%

(1) The acquisition costs are related to historical and potential business combinations of the Group.

Below is the Adjusted EBITDA Margin calculation for the period specified stated in the Company's reporting currency and constant currency:

 

Reporting Currency

 

Constant

Currency

 

Reporting Currency

 

Constant

Currency

 

Three Months Ended

June 30,

 

Change

 

Change

 

Six Months Ended

June 30,

 

Change

 

Change

 

2023

 

2022

 

%

 

%

 

2023

 

2022

 

%

 

%

 

(USD in thousands, except margin)

 

 

 

 

(in thousands USD, except margin)

 

 

 

Revenue

25,972

 

 

15,924

 

 

63

%

 

60

%

 

52,664

 

 

35,509

 

 

48

%

 

49

%

Adjusted EBITDA

9,424

 

 

3,617

 

 

161

%

 

156

%

 

20,097

 

 

10,719

 

 

87

%

 

89

%

Adjusted EBITDA Margin

36

%

 

23

%

 

 

 

 

 

38

%

 

30

%

 

 

 

 

 

In regard to forward looking non-IFRS guidance, we are not able to reconcile the forward-looking non-IFRS Adjusted EBITDA measure to the closest corresponding IFRS measure without unreasonable efforts because we are unable to predict the ultimate outcome of certain significant items including, but not limited to, fair value movements, share-based payments for future awards, acquisition-related expenses and certain financing and tax items.

Free Cash Flow

Free Cash Flow is a non-IFRS liquidity financial measure defined as cash flow from operating activities adjusted for non-recurring items within operating cash flow less capital expenditures.

We believe Free Cash Flow is useful to our management team as a measure of financial performance as it measures our ability to generate additional cash from our operations. While we use Free Cash Flow as a tool to enhance our understanding of certain aspects of our financial performance, we do not believe that Free Cash Flow is a substitute for, or superior to, the information provided by IFRS metrics. As such, the presentation of Free Cash Flow is not intended to be considered in isolation or as a substitute for any measure prepared in accordance with IFRS.

The primary limitation associated with the use of Free Cash Flow as compared to IFRS metrics is that Free Cash Flow does not represent residual cash flows available for discretionary expenditures because the measure does not deduct the payments required for debt service and other obligations or payments made for business acquisitions. Free Cash Flow as we define it also may not be comparable to similarly titled measures used by other companies in the online gambling affiliate industry.

Below is a reconciliation to Free Cash Flow from cash flows generated by operating activities as presented in the Consolidated Statement of Cash Flows for the period specified in the Company's reporting currency:

 

Three Months Ended

June 30,

 

Change

 

Six Months Ended

June 30,

 

Change

 

2023

 

2022

 

%

 

2023

 

2022

 

%

 

(in thousands USD, unaudited)

 

 

 

(USD in thousands, unaudited)

 

 

Cash flows generated by operating activities

4,586

 

 

3,368

 

 

36

%

 

11,669

 

 

6,944

 

 

68

%

Payment of contingent consideration

4,621

 

 

 

 

100

%

 

4,621

 

 

 

 

100

%

Capital Expenditures (1)

(681

)

 

(546

)

 

25

%

 

(1,558

)

 

(2,758

)

 

44

%

Free Cash Flow

8,526

 

 

2,822

 

 

202

%

 

14,732

 

 

4,186

 

 

252

%

(1) Capital expenditures are defined as the acquisition of property and equipment and the acquisition of intangible assets, and excludes cash flows related to business combinations.

 

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