Bragg Gaming Group has published its fourth quarter and full-year 2021 financial results, reporting new revenue records in both measuring periods, including a yearly revenue increase of 25.6% to $64.7m.
Updating investors, Chief Strategy Officer Yaniv Spielberg added that the group expects to go live with its games in the US and Canada later this year. The group also predicts a full-year revenue for 2022 in the range of $76m to $80m.
In Q4 2021, Bragg declared a revenue increase of 14.4% to $17.5m (Q4 2020: $15.3m). For the year, the group saw a 25.6% improvement in revenue to $64.7m (2020: $51.5m).
Wagering revenue generated by customers decreased by 8.8% in Q4 2021 to $3.4bn (Q4 2020: $3.8bn). Bragg noted this was because of “changes in the product mix, towards PAM, managed services and proprietary content” which improved gross profit and adjusted EBITDA.
Meanwhile, over the full year, the group witnessed a 21.1% growth in wagering revenue generated by customers to $15.9bn (2020: $13.1bn). The number of unique players using Bragg games via its Oryx Hub distribution platform and content went up as well by 11.2% to 6.5 million (2020: 5.9 million).
Bragg’s gross profit in Q4 rose by 33.3% to $8.9m (Q4 2020: $6.7m), reflecting higher revenue and a 720 basis point margin improvement to 51%. The group claimed that the margin expansion was a “result of the continued shift towards a higher proportion of revenues from igaming and turnkey services”.
Gross profit increased by 40.3% over 2021 to $31.4m (2020: $22.4m), reflecting a 510 basis point margin gain to 48.6%.
Q4 2021 saw a net loss for the firm of $1.8m, an improvement on Q4 2020’s net loss of $5.9m thanks to “higher gross profit and a reduction in costs related to deferred consideration payable, partially offset by the incremental increase in employee costs and professional fees as a result of the Nasdaq listing”.
For 2021, the group reported a net loss of $8.3m, an improvement from the net loss of $16.2m in 2020.
Adjusted EBITDA in Q4 2021 was $1.7m, a 22.2% improvement YoY (Q4 2020: $1.4m), while adjusted EBITDA margin increased by 70 basis points to 9.8% during the period.
For the full-year, adjusted EBITDA was $8m, a 29.8% growth YoY (2020: $6.1m), while adjusted EBITDA margin rose by 40 basis points to 12.3%. Cash and cash equivalents, as of December 31, 2021, was $17.8m.
Commenting on the results, Spielberg, stated: “The 2021 fourth quarter concluded an active and productive year for Bragg as continued execution on our key strategic initiatives drove significant operational accomplishments and strong financial results.”
Alongside going live in the UK and the Netherlands with its igaming offering in Q4, Bragg also introduced player-popular content in six regulated European markets, increasing its total addressable market by more than $10bn to approximately $13.5bn.
Bragg also made significant progress towards entry into additional new markets and later this year, it expects its games to go live in the US and Canada. It also began offering more high-performing proprietary and third-party online content via its Wild Streak acquisition. The group saw a 42% growth in new customers in 2021.
Spielberg continued: “Our strong margin performance in the quarter highlights the significant progress we’ve made against our goal to grow gross profit margin to approximately 60% by 2024.”
Bragg is also near to closing its acquisition of Spin Games, having completed all of its regulatory requirements. It is now awaiting final review by the sole remaining regulatory body, which it expects to be complete in the next few months.
The group is also continuing to work on the integration of the Spin Games technology platform with its ORYX platform, submitting the integrations for certification by approved US gaming laboratories.
Bragg expects to introduce its igaming content in several US states very quickly once it receives the remaining required regulatory approval to complete the acquisition.
Looking ahead into 2022, Bragg expects full-year revenue in the range of $76m to $80m and adjusted EBITDA between $10.5m to $11.7m. The midpoints of the 2022 revenue and adjusted EBITDA guidance ranges represent growth of 20% and 39%, respectively, over the reported full-year 2021 revenue and adjusted EBITDA.
“Our planned entry into the US and Canada, as well as additional regulated European markets this year, has Bragg on track to grow our year-end 2022 TAM to more than $21 billion,” Spielberg added.
“The strong performance we have achieved in a number of our recently entered markets as well as our existing markets in the early months of 2022, and the ongoing roll-out of our new proprietary games, amplifies our confidence for continued operating momentum.
“We believe the ongoing execution of our operating priorities favorably positions Bragg to both further accelerate this growth in 2023 and create new near- and long-term shareholder value.”