Records continue to tumble for Bragg Gaming as the company reported a new revenue high of €24.7m in the second quarter of 2023.
Commenting on the results, CEO Yaniv Sherman noted that the performance reflects a “continued shift towards a revenue mix of higher-margin products” for the igaming provider, which has also tightened its 2023 revenue and adjusted EBITDA guidance range.
New revenue high for Bragg
Publishing its Q2 results, Bragg declared revenue of €24.7m, up 18.9 per cent year-over-year (Q2 2022: €20.8m) and an improvement on Q1’s €22.9m. Gross profit also improved by 18.9 per cent in comparison to the previous year to €13.8m (2022: €11.6m).
Meanwhile, the provider’s adjusted EBITDA rose by 51.3 per cent in Q2 to €4.7m (2022: €3.1m) with a new quarterly high AEBITDA margin of 19.2 per cent, up 410-basis points YoY (2022: 15.1 per cent).
By the end of Q2, cash flow from operations stood at €5.2m (2022: €7.6m) while cash and cash equivalents came in at €10.7m and net working capital, excluding deferred consideration, was €8.3m.
Sherman noted that the gains seen by Bragg in Q2 can be attributed to “initiatives to focus the business to be a leading content-driven igaming B2B provider combined with disciplined expense management”.
The CEO also stated the results benefited from a “continued shift towards a revenue mix of higher-margin products including in-house created proprietary and exclusive third-party content, turn-key Player Account Management and managed services partnerships,” which helped to drive the quarterly record for AEBITDA margin.
Content roll out & 2023 guidance updated
Wagering revenue generated by Bragg games and content also rose by 31.2 per cent during Q2 to €5.5bn (2022: €4.2bn) as the provider continued to roll out content and services across North America and Europe.
In North America, content and RGS technology went live across several US states, including Rush Street Interactive in Pennsylvania, FanDuel in Michigan and Connecticut and WynnBet in New Jersey.
Bragg has also recently entered into global distribution deals with 888 Holdings and PokerStars, bringing content to the European markets of the UK, Italy, Portugal, Spain, Denmark and Sweden, as well as New Jersey, Michigan and Pennsylvania in the US.
Elsewhere in Europe, the provider launched for the first time in Georgia with Adjarabet and expanded in Switzerland and Spain with six new customers.
Bragg added that since April 1, the company has made four monthly cash payments to the Lind Global Fund II LP in the “aggregate amount of $2m, in lieu of conversion into common shares, avoiding further dilution”. As of August 10, the total outstanding balance of the convertible security is $6m, with the company stating that it expects to “utilise cash flow from operations to make similar monthly payments to further reduce the Lind convertible security”.
In reaction to the momentum in Q2 and the first half of the year, Bragg has updated and tightened its 2023 guidance to revenue in the range of €95m to €97m (previously €93m to €97m) and AEBITDA between €15.5m to €16.5m (previously €14.5m to €16.5m).
The midpoints of the full-year guidance now reflect a YoY revenue growth of 13 per cent and an AEBITDA growth of 32 per cent.
Sherman concluded: “With significant and ongoing progress on our key strategic initiatives Bragg is positioned to deliver further year-over-year revenue and cash flow growth in the second half of 2023 and beyond.
“Our balance sheet and strong cash flow has us well capitalised to execute on our growth initiatives. We are confident we have the right strategies and infrastructure in place to continue fortifying our position as a leading B2B igaming content provider and that our business momentum will create new value for our shareholders.”