Bragg Gaming believes that a strong start to the year could see the business outperform its 2022 guidance, with market expansion, proprietary games development initiatives and customer growth leading the group to a record Q1.
Continued business momentum was heavily praised by the B2B gaming tech and content provider, as revenue through the year’s first quarter increased 36.4 per cent to €19.4m (2021: €14.2m).
Wagering revenue remained consistent year-on-year at €3.8bn, reflecting changes in product mix towards PAM, managed services and proprietary content, which Bragg says drove improved gross profit and adjusted EBITDA.
Elsewhere, gross profit soared 50.7 per cent to €10m (2021: €6.6m), which is aligned to a “continued shift towards a higher proportion of revenues from igaming and turnkey services, which have lower associated cost of sales when compared to games and content”.
Net loss lowered to €700,000 from €1.1m one year earlier due to higher gross profit and lower transaction costs, partially offset by an incremental increase in employee costs, professional fees, sales and marketing expense; and higher depreciation and amortisation.
Adjusted EBITDA closed the three month period at €3m, up 26.2 per cent from €2.3m (USD $2.4 million) in Q1 2021, with its margin down to 15 per cent which it attributed to “higher investments in software development, product, and senior management functions to execute the growth initiatives implemented in mid-2021”.
“Our momentum continued in the first quarter as the successful execution of our growth initiatives focused on offering more higher-margin proprietary and third-party exclusive games and our igaming PAM, combined with ongoing expansion into new regulated igaming markets, drove strong growth in our operating results,” said Yaniv Spielberg, Chief Strategy Officer for Bragg Gaming.
Adding: “These record financial results reflect, in part, growing revenue from higher gross margin in-house content and platform revenue which together drove record quarterly gross profit margin of 51.8 per cent, an 80 basis point improvement over our prior gross profit margin record achieved in 4Q 2021.
“The record quarterly margin supports our confidence that we have the right operating plan in place to achieve our goal of growing gross profit margin to approximately 60 per cent by 2024.”
Furthermore, the company has reiterated its outlook for the full-year, despite Spielberg suggesting that “we believe our continuing business momentum positions Bragg for the potential of another strong year of outperformance relative to this outlook“.
This sees revenue expected to fall into the range of €68m-€72m with adjusted EBITDA to come at €9.5m-€10.5m. These midpoints would represent growth of 20 per cent and 39 per cent.