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Share Name | Share Symbol | Market | Type |
---|---|---|---|
NeoGames SA | NASDAQ:NGMS | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 29.45 | 29.43 | 27.98 | 0 | 01:00:00 |
Exhibit
|
Description
|
NEOGAMES S.A.
|
|||
By:
|
/s/ Moti Malul
|
||
Name: Moti Malul
|
|||
Title: Chief Executive Officer
|
|||
• |
The total of Revenues and the Company’s share of NPI revenues was $63.3 million during the third quarter of 2023, compared to $73.3 million during the third quarter of 2022. These figures reflect accounting for the majority of Aspire
Core revenues on a net basis in the third quarter of 2023 compared to historical figures in the third quarter of 2022, which were prepared on a gross basis, prompted by new commercial terms in certain Aspire Core contracts which went into
effect on January 1, 2023. If iGaming revenues had been accounted for on a gross basis for the Aspire Core, the total of Revenue and the Company’s share in NPI revenues would have been $81.7 million, which would have reflected 11.5%
year-over-year growth when measured in reporting currency. In addition to accounting for the new commercial terms, current year results reflect continued growth in the Company’s iLottery, Games and Sports business lines, partially offset
by a slowdown in Aspire Core revenues due to regulatory changes in the United Kingdom and a temporary pause in operations in Germany prior to the Company recently securing its local license to operate.
|
• |
iLottery revenues were $14.4 million during the third quarter of 2023, compared to $13.7 million during the third quarter of 2022, representing an increase of 5.6% year-over-year. In addition, the Company’s share in NPI revenues was
$17.0 million during the third quarter of 2023, compared to $11.1 million during the third quarter of 2022, representing an increase of 53.3% year-over-year. The total of NeoGames’ iLottery revenue plus the Company’s share of NPI revenues
during the third quarter of 2023 was $31.4 million, up 26.9% year-over-year, primarily driven by continued positive growth trend across most major accounts and the jackpot in the US market during the third quarter.
|
• |
iGaming revenues were $31.9 million for the third quarter of 2023. These figures reflect accounting for the majority of Aspire Core revenues on a net basis compared to historical figures which were prepared on a gross basis, prompted
by new commercial terms in certain Aspire Core contracts which went into effect on January 1, 2023. If iGaming revenues had been accounted for on a gross basis for the Aspire Core, total revenue would have been $50.5 million for iGaming
primarily driven by continued growth in Games and Sports business lines, partially offset by a slowdown in Aspire Core revenues due to regulatory changes in the United Kingdom and a temporary pause in operations in Germany prior to the
Company recently securing its local license to operate, which would have reflected 4% year-over-year growth when measured in reporting currency.
|
• |
Net loss was $(3.6) million, or $(0.10) per share, during the third quarter of 2023, compared to a net loss of $(4.4) million, or $(0.13) per share, during the third quarter of 2022. Net loss during the third quarter of 2023 was
mainly due to costs attributed to the Aristocrat transaction and the amortization attributable to the Aspire business combination.
|
• |
Adjusted net income was $4.4 million, or $0.13 per share, during the third quarter of 2023, compared to $3.0 million, or $0.09 per share, during the third quarter of 2022.
|
• |
Adjusted EBITDA1 was $19.9 million during the third quarter of 2023, compared to $17.6 million during the third quarter of 2022, representing an increase of 12.9% year-over-year.
|
• |
Cash and cash equivalents balance as of the end of third quarter of 2023 was $27.1 million, compared to $41.2 million at the end of 2022, resulting in net negative cash of $14.1 million for the nine months of 2023. The difference in
cash flows is primarily attributable to a number of key factors including advisor payments related to the Aristocrat transaction, slowness in Aspire Core operations, a consideration for the acquisition of the remaining shares of GMS
Entertainment Ltd. from the managing director of Pariplay, and the impact from a bank guarantee required to secure the Company’s German license.
|
• |
Our Joint Venture, NPI, was selected by the West Virginia Lottery for a full turn-key iLottery program, representing the fifth state in which NPI will operate a full iLottery program in the U.S., growing our market share and
leadership.
|
• |
North Carolina Education Lottery was approved to expand its iLottery offering with eInstants and our teams together with NPI are making the necessary preparations to support the lottery towards launch in the near future.
|
• |
NeoGames Studio has expanded its offering into OPAP, the Greek Lottery Operator, through the relationship and integration provided through Pariplay.
|
• |
Pariplay entered Pennsylvania with Rush Street Interactive (NYSE: RSI), marking the fifth U.S. state entered by Pariplay.
|
• |
Pariplay signed 10 new operators during the quarter, including Hard Rock and Fortuna Entertainment Group.
|
• |
Aspire Global was awarded slots license in Germany by GGL and have launched a few partner brands to begin operations in that market.
|
• |
BtoBet entered into a long-term sportsbook partnership and went live with Alberta Gaming, Liquor & Cannabis (“AGLC"), through NPI, marking its successful entry into the North American market.
|
• |
NeoGames Studio launched its portfolio of eInstant games content with the Atlantic Lottery Corporation Canada.
|
September 30, 2023
|
December 31, 2022
|
|||||||
ASSETS
|
||||||||
CURRENT ASSETS
|
||||||||
Cash and cash equivalents
|
$
|
27,120
|
$
|
41,179
|
||||
Restricted deposits
|
486
|
489
|
||||||
Prepaid expenses and other receivables
|
5,908
|
5,789
|
||||||
Due from the Michigan Joint Operation and NPI
|
4,860
|
3,768
|
||||||
Trade receivables
|
39,228
|
38,537
|
||||||
Income tax receivables
|
277
|
536
|
||||||
Total current assets
|
$
|
77,879
|
$
|
90,298
|
||||
NON-CURRENT ASSETS
|
||||||||
Restricted deposits - Joint Venture and other
|
10,215
|
4,247
|
||||||
Property and equipment
|
3,467
|
3,992
|
||||||
Intangible assets
|
333,691
|
347,213
|
||||||
Right-of-use assets
|
8,040
|
7,973
|
||||||
Investment in Associates
|
5,478
|
4,770
|
||||||
Deferred taxes
|
1,456
|
2,451
|
||||||
Total non-current assets
|
362,347
|
370,646
|
||||||
Total assets
|
$
|
440,226
|
$
|
460,944
|
||||
LIABILITIES AND EQUITY
|
||||||||
CURRENT LIABILITIES
|
||||||||
Trade and other payables
|
$
|
16,731
|
$
|
16,042
|
||||
Royalty payables
|
9,787
|
10,838
|
||||||
Client liabilities
|
5,444
|
6,927
|
||||||
Income tax payables
|
9,124
|
7,396
|
||||||
Gaming tax payables
|
6,848
|
10,133
|
||||||
Lease liabilities
|
1,821
|
1,150
|
||||||
Contingent consideration on business combination and other
|
11,080
|
17,256
|
||||||
Employees' related payables and accruals
|
9,726
|
7,262
|
||||||
Total current liabilities
|
$
|
70,561
|
$
|
77,004
|
||||
NON-CURRENT LIABILITIES
|
||||||||
Liability with respect to Caesars' IP option
|
3,450
|
3,450
|
||||||
Loans from financial institution, net
|
208,616
|
209,287
|
||||||
Company share of Joint Venture liabilities, net
|
493
|
539
|
||||||
Lease liabilities
|
5,649
|
6,823
|
||||||
Accrued severance pay, net
|
1,117
|
1,033
|
||||||
Deferred taxes
|
15,283
|
17,469
|
||||||
Total non-current liabilities
|
$
|
234,608
|
$
|
238,601
|
||||
EQUITY
|
||||||||
Share capital
|
60
|
59
|
||||||
Reserve with respect to transaction under common control
|
(8,467
|
)
|
(8,467
|
)
|
||||
Reserve with respect to funding transactions with related parties
|
20,072
|
20,072
|
||||||
Accumulated other comprehensive income (loss)
|
(349
|
)
|
482
|
|||||
Share premium
|
176,918
|
173,908
|
||||||
Share based payments reserve
|
6,681
|
6,941
|
||||||
Accumulated losses
|
(59,858
|
)
|
(47,656
|
)
|
||||
Total equity
|
135,057
|
145,339
|
||||||
Total liabilities and equity
|
$
|
440,226
|
$
|
460,944
|
Quarter ended September 30,
|
Year to date September 30,
|
|||||||||||||||
2023
|
2022
|
2023
|
2022
|
|||||||||||||
Revenues
|
$
|
46,336
|
$
|
62,174
|
$
|
143,777
|
$
|
96,476
|
||||||||
Distribution expenses
|
23,087
|
41,255
|
71,072
|
52,160
|
||||||||||||
Development expenses
|
4,193
|
2,085
|
12,583
|
7,656
|
||||||||||||
Selling and marketing expenses
|
2,188
|
1,345
|
7,329
|
2,547
|
||||||||||||
General and administrative expenses
|
8,042
|
6,436
|
24,160
|
14,329
|
||||||||||||
Business combinations related expenses
|
1,474
|
835
|
5,879
|
17,217
|
||||||||||||
Depreciation and amortization
|
14,361
|
14,348
|
41,694
|
23,353
|
||||||||||||
53,345
|
66,304
|
162,717
|
117,262
|
|||||||||||||
Loss from operations
|
(7,009
|
)
|
(4,130
|
)
|
(18,940
|
)
|
(20,786
|
)
|
||||||||
Interest expenses with respect to funding from related parties
|
-
|
-
|
-
|
2,867
|
||||||||||||
Finance expenses
|
6,286
|
4,702
|
17,346
|
6,356
|
||||||||||||
The Company's share in profits of Joint Venture and associated companies
|
10,210
|
5,525
|
26,708
|
13,978
|
||||||||||||
Loss before income tax expense
|
(3,085
|
)
|
(3,307
|
)
|
(9,578
|
)
|
(16,031
|
)
|
||||||||
Income tax expenses
|
(478
|
)
|
(1,061
|
)
|
(2,624
|
)
|
(2,141
|
)
|
||||||||
Net loss
|
$
|
(3,563
|
)
|
$
|
(4,368
|
)
|
$
|
(12,202
|
)
|
$
|
(18,172
|
)
|
||||
Net loss per common share outstanding, basic
|
$
|
(0.10
|
)
|
$
|
(0.13
|
)
|
$
|
(0.36
|
)
|
$
|
(0.64
|
)
|
||||
Net loss per common share outstanding, diluted
|
$
|
(0.10
|
)
|
$
|
(0.13
|
)
|
$
|
(0.36
|
)
|
$
|
(0.64
|
)
|
||||
Weighted average number of ordinary shares outstanding:
|
||||||||||||||||
Basic
|
33,683,107
|
33,453,706
|
33,598,543
|
28,447,179
|
||||||||||||
Diluted
|
33,683,107
|
33,453,706
|
33,598,543
|
28,447,179
|
||||||||||||
Adjusted EPS2
|
$
|
0.13
|
$
|
0.09
|
$
|
0.33
|
$
|
(0.37
|
)
|
YTD
September 30, 2023
|
||||
Cash flows from operating activities:
|
||||
Net loss
|
$
|
(12,202
|
)
|
|
Changes in other financial assets and liabilities
|
(6,707
|
)
|
||
Amortization and depreciation
|
41,694
|
|||
Finance expenses
|
17,346
|
|||
Share based compensation
|
2,543
|
|||
Other
|
(191
|
)
|
||
Net cash generated from operating activities
|
$
|
42,483
|
||
Net cash used in investing activities
|
$
|
(34,731
|
)
|
|
Net cash used in financing activities
|
$
|
(22,001
|
)
|
|
Net decrease in cash and cash equivalents
|
(14,249
|
)
|
||
Cash and cash equivalents – beginning of period
|
41,179
|
|||
Currency exchange differences on cash and cash equivalents
|
190
|
|||
Cash and cash equivalents – end of period
|
$
|
27,120
|
Quarter ended September 30,
|
Year to date September 30,
|
|||||||||||||||
2023
|
2022
|
2023
|
2022
|
|||||||||||||
Net loss
|
$
|
(3,563
|
)
|
$
|
(4,368
|
)
|
$
|
(12,202
|
)
|
$
|
(18,172
|
)
|
||||
Income tax expenses
|
478
|
1,061
|
2,624
|
2,141
|
||||||||||||
Finance expenses
|
6,286
|
4,702
|
17,346
|
9,223
|
||||||||||||
E(L)BIT
|
3,201
|
1,395
|
7,768
|
(6,808
|
)
|
|||||||||||
Depreciation and amortization
|
14,361
|
14,348
|
41,694
|
23,353
|
||||||||||||
EBITDA
|
17,562
|
15,743
|
49,462
|
16,545
|
||||||||||||
Business combination related expenses
|
1,474
|
835
|
5,879
|
17,217
|
||||||||||||
Share-based compensation
|
753
|
883
|
2,543
|
2,476
|
||||||||||||
Company share of NPI depreciation and amortization
|
57
|
113
|
158
|
170
|
||||||||||||
Adjusted EBITDA
|
$
|
19,846
|
$
|
17,574
|
$
|
58,042
|
$
|
36,408
|
Quarter ended September 30,
|
Year to date September 30,
|
|||||||||||||||
2023
|
2022
|
2023
|
2022
|
|||||||||||||
Royalties from turnkey contracts
|
$
|
7,930
|
$
|
7,195
|
$
|
23,152
|
$
|
21,381
|
||||||||
Royalties from games contracts
|
545
|
389
|
1,404
|
1,283
|
||||||||||||
Use of IP rights
|
4,464
|
3,903
|
13,714
|
10,139
|
||||||||||||
Development and other services - Aspire
|
-
|
439
|
-
|
1,286
|
||||||||||||
Development and other services - NPI
|
1,120
|
1,328
|
3,307
|
4,409
|
||||||||||||
Development and other services - Michigan Joint Operation
|
362
|
407
|
1,006
|
1,165
|
||||||||||||
Revenues
|
$
|
14,421
|
$
|
13,661
|
$
|
42,583
|
$
|
39,663
|
||||||||
NeoGames' NPI revenues interest
|
$
|
16,994
|
$
|
11,086
|
$
|
45,883
|
$
|
30,512
|
||||||||
NeoGames revenues plus NPI revenues interest
|
$
|
31,415
|
$
|
24,747
|
$
|
88,466
|
$
|
70,175
|
||||||||
iGaming revenues
|
$
|
31,915
|
$
|
48,513
|
$
|
101,194
|
$
|
56,813
|
||||||||
Revenues plus NeoGames NPI revenues interest
|
$
|
63,330
|
$
|
73,260
|
$
|
189,660
|
$
|
126,988
|
Quarter ended September 30,
|
Year to date September 30,
|
|||||||||||||||
2023
|
2022
|
2023
|
2022
|
|||||||||||||
Net loss
|
$
|
(3,563
|
)
|
$
|
(4,368
|
)
|
$
|
(12,202
|
)
|
$
|
(18,172
|
)
|
||||
Amortization attributable to business combination, net of tax
|
7,939
|
7,356
|
23,379
|
7,772
|
||||||||||||
Adjusted net income (loss)
|
$
|
4,376
|
$
|
2,988
|
$
|
11,177
|
$
|
(10,400
|
)
|
|||||||
Adjusted net income (loss) per common share outstanding
|
$
|
0.13
|
$
|
0.09
|
$
|
0.33
|
$
|
(0.37
|
)
|
Quarter ended September 30,
|
$ Change
|
% Change
|
||||||||||||||||||||||||||
2023
|
2022
|
As reported
|
Foreign exchange impact
|
In constant currency
|
As reported
|
In constant currency
|
||||||||||||||||||||||
Aspire Core3
|
$
|
12,181
|
$
|
33,048
|
$
|
12,181
|
$
|
(924
|
)
|
$
|
11,257
|
(63.1
|
)%
|
(65.9
|
)%
|
|||||||||||||
Games
|
11,128
|
8,771
|
11,128
|
(822
|
)
|
10,306
|
26.9
|
%
|
17.5
|
%
|
||||||||||||||||||
Sports
|
8,606
|
6,694
|
8,606
|
(636
|
)
|
7,970
|
28.6
|
%
|
19.1
|
%
|
||||||||||||||||||
Net Revenues, as reported
|
$
|
31,915
|
$
|
48,513
|
$
|
31,915
|
$
|
(2,382
|
)
|
$
|
29,533
|
Year to date September 30,
|
$ Change
|
% Change
|
||||||||||||||||||||||||||
2023
|
2022
|
As reported
|
Foreign exchange impact
|
In constant currency
|
As reported
|
In constant currency
|
||||||||||||||||||||||
Aspire Core4
|
$
|
44,965
|
$
|
108,525
|
$
|
44,965
|
$
|
(917
|
)
|
$
|
44,048
|
(58.6
|
)%
|
(59.4
|
)%
|
|||||||||||||
Games
|
31,510
|
26,475
|
31,510
|
(701
|
)
|
30,809
|
19.0
|
%
|
16.4
|
%
|
||||||||||||||||||
Sports
|
24,719
|
16,844
|
24,719
|
(696
|
)
|
24,023
|
46.8
|
%
|
42.6
|
%
|
||||||||||||||||||
Net Revenues, as reported
|
$
|
101,194
|
$
|
151,844
|
$
|
101,194
|
$
|
(2,314
|
)
|
$
|
98,880
|
1 Year NeoGames Chart |
1 Month NeoGames Chart |
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