Gaming Realms on track to post 2017 profit as EBITDA losses narrow
Operator’s H1 revenues climb 5% although analysts suggest the period of easy growth is “likely over”
Gaming Realms this morning reported a 5% jump in H1 revenues to £15.7m, with the London-listed firm buoyed by its new white label sites based on TV programmes.
The company recently launched real-money gambling sites based on Deal or No Deal and Love Island in partnership with ITV and Storm games.
It also signed agreements to provide its Slingo games to five operators in New Jersey, including Caesars, GVC and Resorts Digital, with those deals expected to provide incremental revenues in H2.
“We are pleased with the progress made on a number of fronts, but particularly in real money gaming, the licencing of our Slingo Originals portfolio to third parties and the way we are managing cost, all of which means that we are in line with our plan and should deliver a profitable outcome for the year as a whole,” group CEO Patrick Southon said.
EBITDA losses narrowed by £2.7m to £0.9m, partly as a result of integrating the social business, with the firm claiming to be on track for a profitable year.
“The Board anticipates the Company will achieve significant positive EBITDA in the second half of the financial year with increased revenues, seasonal marketing costs reduced, and a full period of benefits from the integration of the social business,” a statement said.
The operator said it plans to raise approximately £1m from investors in “the relatively short-term”.
Regulus Partners said the results suggested “the shift from very small to small is much easier than from small to medium-sized”.
“Very few gambling companies and almost no gaming companies break though this barrier, especially when focused on a single real-money market (even a big one such as the UK),” the analysts said.
“Execution risk on this transition is very high and M&A is often seen as a desired alternative. Given Gaming Realms’ innovative product and platform capabilities, its future as part of a successful growth strategy remains likely, though the period of easy growth appears to be over.”