Nektan banks on technological edge as expansion – and losses – continue

Publishing its full-year results to June 30, 2018, gaming technology company Nektan has seen its revenue and reach grow, while losses – although reduced – continue.

Total revenue grew 52 per cent in the period, to £20.1m up from £13.3m, while net gaming revenue also increased significantly, up 48 per cent to £19.4m from £13.1m a year prior.

New first-time depositing players increased strongly, up 20 per cent year on year to 156,703. Total cash wagering was up markedly, by 43 per cent to £560m from £390m in the prior period.

However, losses continued even if adjusted EBITDA loss was reduced to £2.4m, down from a loss of £3.4m in FY 2017. The 12-month period also saw an operating loss of £5.5m, an increase on the £4.6m deficit posted in the previous period.

The figures include 12 months’ operation of Nektan’s US division, compared to six months in the prior year. Excluding the US, adjusted EBITDA loss in the period reduced to £1.4m from £2.7m, which saw an operating loss of £0.5m in H2 versus £0.9m in H1.

The figures paint a picture of a robust business presently able to roll with the punches. However, if new CEO Lucy Buckley is to help steer Nektan into smoother waters, the company will need to see those losses wiped out, and soon.

The company will raise some funds through the sale of 57.5 per cent of its US subsidiary Respin, for £2m in cash, and a further £1.5m through an equity placing and subscriptions for new ordinary shares at a price of 15p per share.

Gary Shaw, Nektan founder and executive director, called the year “transformative,” adding that the period had seen “substantial operational enhancements which have led to a significant increase in commercial opportunities for the group.

“During the year, Nektan continued to develop its mobile casino product offering, expanded into new geographic markets, launched new product offerings and grew significantly in each quarter,” he said.

“We believe that our proprietary technology is unique in the market place and we are now attracting major global partners who wish to use the feature rich gaming content we have worked so hard to populate our platforms with.

“By working closely with the best developers of casino games, we can provide our partners with engaging, socially responsible and compliant content. The growth we have seen during this financial year reflects the progress we have made in adding more content and providing this to a growing list of partners,” said Shaw.

“This is a growth trajectory that we continue to see not just domestically, but globally in emerging markets such as Asia.”