GAMB - Earnings call transcript Q2 2021 | Gambling.com Group Limited

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Operator

Hello, everyone, and welcome to Gambling.com Group Second Quarter 2021 Earnings Results Call. I'm joined by Charles Gillespie, Chief Executive Officer and Co-Founder; as well as Elias Mark, Chief Financial Officer. This call is being webcast live within the Investor Relations section of our website at gambling.com/corporate/investors, and a downloadable version of the presentation is available there as well. A replay will also be available on the website after the conclusion of this call.

You may also contact Investor Relations support by emailing investors@gdcgroup.com. statements remind including the guidance any provided, of to this contained to like securities consists call, by conference financial forward-looking would you information that in be laws. I defined as and related in These statements. opportunities us involve statements from to cause or differ risks to and performance expressed could and future that materially are results, information or uncertainties business available these on actual based implied currently by and prospects those and

differences such Securities are in important factors cause Some Gambling.com's the could Factors Risk with of and discussed section that the Commission. filings Exchange

speak the to other the forward-looking information, made, obligation are as laws. assumptions actual statements extent Forward-looking assumes update factors affecting required to only in of in reflect date the no changes to company securities the today, except results, statements applicable statements by forward-looking changes and or

also this will directly description included discussion now to included tab there appendix issued release of call, reconciliations our and I'll their measures the presentation non-IFRS to non-IFRS A in financial these the call the the of in be measures release, is of available these of morning. financial are comparable both press IFRS measures. to press financial Investor a During And the which website. the Charles. are most over turn measure of on

Charles Gillespie

thank quarter online our our forward you the incredibly Group. To last future of interest on end. as other quarter We year, sharing And of like growth compared grew quarter the Revenue year. reviewing XX% we in our Thank shareholders, to revenue events from history. for growing last income look company. you. XXX%. our you. we gambling half compared month And quarter opportunities online event for welcome, prospective the Net Global the The doubled notable our success share, the in about everyone, was million in that quarter and the with by I'd was more excited subsequent a organic highlights the earnings Most first diluted the second to ahead and Gambling.com fastest of the us. industry $X.XX a the increasing lie monumental public first gambling has your start and shares to fast company's to $X.X support listing to the Through call all and companies XXXX, better to growing Market among our new are results the than second successful for industry. in significantly year. was prior per impressively, of are our than and NASDAQ or

U.S. increase capitalized which of flow growing Our our down presence slightly names market. adjusted purchase -- XXXX. expenditures was of EBITDA related due totaled with capital the strategy development cash to $X.X in a which the $X.X XX% aligned costs million from XX% higher million, was U.S. was to and our Free domain of

safe up-to-date and them place new during IllinoisBet help best launched and legal provides quarter BetArizona EmpireStakes, wagers. information bettors including also We to sportsbook online the with and trusted find the websites state-specific which to

symbol in our as and S&P will member International a created as our publicly the is Dan completed we growth end, after of hospitality CFO G-A-M-B, team Malta execute also asset, the have the most I Dan the our as the we now Market was be Channel public known from of MGM completed a Global We after under of of company announced successful what that the of And July, strategy experience invaluable mentioned a we the quarter the casino the Jersey XXX the of business public shortly as the listing as BetMGM. and D’Arrigo company. Board May. as served to traded addition Directors. recently Dan’s of an Resorts CFO late shares to in redomiciliation of on NASDAQ Island ordinary ticker

our the spend presenting IPO, to Given of I'd some of like recency time Gambling.com an Group. overview

provider operators, sites functions two critically ecosystem. offer in services a gambling for online the our of acquisition but basic online services and As leading gambling important player

we First, with online make providing online experience players that gambling ensuring the quality their players choice simultaneously information targets they help responsible when player them tools And online up-to-date gambling choosing an BXC them. to entertainment company, help sports by online from help betting get operators those referring acquisition we and achieve to company. and by a casino right second, them a

compounded or we serve of as our of have service of an available agreements, roughly revenue testament of a top-line to year-on-year. $XX XXXX, sent that share which the and XX% we free million the those are gambling organic proprietary to and generated margin ongoing technology a of future is where we our of high-quality to gambling destinations. which hybrid we from are growing either net We In as grew all industry, result. financial by the derived players XXXX and EBITDA XX%. a status the branded our $XX.X of At XX% same $XX.X well. have validated generated operator million clients. at we share XXXX, unlike our operators organic. the entitled of XXXX, rate extremely the performance to was From million, we platform XXXX, flow of the time, In each was BXC annualized an adjusted leadership in as XX% referred revenue our to total in importance achieved at cash Our content have revenue of many Again, growth These figures profitable.

matched and the year, the cash of Through we of results six nearly generated through adjusted of have first XXXX. first months flow. the million those $X.X already free half of We $XX.X million have EBITDA

in global and offices global members. are than Charlotte And team Dublin, employ Tampa. a more We workforce a full-time Malta, we company with of XXX

and accounts our depositing gambling online X markets XX in websites clients We operator different different languages, XXXX. over new referred across we in have to launched customer and over XXX,XXX XX

For those along now following slides, X. of I'm on with the you Slide

we as since be While been may in first rapidly the XXXX player this established had in company, an and our earnings business are public industry. global a expanding we a call

built powerhouse We marketing brands. online for recognized industry an global widely the affiliate gambling with have

brands, and leveraged these Gambling.com the establish premium markets. have including to iconic across Bookies.com We positions leading our

world in in to customer market market. share in to what U.S., our support particularly be across several Our Ireland, the this grow segments, priority, the as growth U.S. our and growth operators We're largest online one XXX legislative as number the our in is Netherlands which expected main markets excited United And their of use different market services online include Over expect gambling the currently as gambling the is online to and our efforts, very DraftKings, critical We've recognized our momentum well Other we experienced names the gambling North such most has to European Kingdom, America. come success Europe now our also to technology-first build BetMGM, later recent all and many the Slide the industry, and with X. strategy. markets. FanDuel, piece in acquisition year. Canada, online strong Caesars, A about PointsBet including I'm been expected of as on other growth continues more.

from It developed Our platform This one mainly and components, an developed of investment built distinct in of to efficiently has growth of scale. resulted revenue is us operate to moat was differentiates platform was competition. which drives offers and consists organic in internally us the in terms us that outperformance our technology what proprietary over internally, years four our our purpose compared continue wide help a our solutions each peers. and to

that system content as specific We the we and management of have a for gambling all central publish. repository acts content produce the

We publishing engine have high optimization consistent strategies. execution system, makes and which our quality ensures search an of website in-house and ultra-fast our

is strategy. server, our process and user generation power also us technology, and advertising years. have the system, has appearance help which from our optimized to efficiently based us players flow determine operator control of of carefully that network intent next across business finally, allow optimization clients manage And through over these manage traffic and BXC data which and customer data these and offers the the risks behavior understand We player gamblers our Critically, websites. machine timing a refined like XX sophisticated across past we have combined, the our network modern science, most the When of that for bespoke on each tools online intelligence our gambling been clean visits to a the learning websites, concentration. profitable path we us to tools our refer helps

Slide to on X. Now

The U.S. as Our growth is global a and the on level, in United the as our of online our core national to future one assets adding pursuing by gambling three is content strategy centers share both based planned well initiatives. destinations. deploying priority. States, international expansion our main U.S. market state Number the and is around industry,

with our Netherlands. potential, that countries growth our such into the growing includes online entrance and global new UK, targeting is Italy, It our Second markets Australia, strategic increasing regulated share as as Switzerland significant Austria, mature in come Germany. more markets also presence, such the and

particularly areas also of comes of market-agnostic, largest evaluating where user a people, which pursue online digital gambling XX regulation And third, world the a like provinces. our strategic the We plan a under-monetized about The is strong fifth U.S. line starting more position across in In new Latin targeting in and excited are regulation us than Pennsylvania, in more opportunistic bottom acquisitions a media affords variety we of is is equivalent there's of assets the million strategy platform technology population We're population to alone, the Ontario America. state of online. Canadian strong that growth the to markets, with engagement.

to Slide X. Now on

We world's expect grow be and positioned United States. share to the what gambling are online we to ultimately market largest market, the uniquely

been more than other of team nationality. American management an since company any co-founders culturally have American our and inception American with senior We members

with unique McCrystle, competing defining essential. we and in We regulation is pre-registration start and Arizona online all licensed name for market. The active the an of we inception the COO. to this track is in in Gambling.com have expect and recognition will destination in asset the historic we leading profitable a Gambling.com. a the look been and category the is betting Gambling.com XX and and content Bookies.com kind my online large in seek intend the before states Co-Founder with U.S. currently domain CEO Similarly, visibility the and and the record. management are there possess with a experienced a since where competitive Saturday. Myself been and world, trust licensing for to industry of positioned a is And market, sports viable only also We has position. Kevin forward mainstay as to legal to affiliate U.S. team states, to of of since we lastly, the and same elevate have one be When in consumers highly It already gambling a Bookies.com flawless a one U.S. operate gambling business

years of position will On our years to Slide to experience We in to in in online leverage the leading XX market the XX. come. U.S. a gambling achieve the global industry

to the largest billion nearly the the have there of the online global Clearly, a in is online years. in XXXX. per believe expectation total gambling gambling established transition the the starting are global reach by in from the is constitutes of for in is what The For XX% markets annual XXXX to Today the to expected U.S. UK, the continue U.S. online just opportunity -- grow context, to time, uptake same top market coming at our market industry high and and highly is in expected online high-quality market of forecast We of XX% today, an to a in the That at the profitable is XX% gambling grow industry. possibly global between share U.S. are expected massive and the XX% online in gambling the of just gambling to in revenue expected over rate player U.S. to overall XX% of billion Industry is And the grow by UK maturity. land-based that where expect for is that, over online short, away comes to segment and growing compound the rapidly grow for nearly growth expanding XXXX. period. year grow most potential in mature gambling. is from $XX UK at gambling tiny X% to which and a the the world. market to proxy total gambling roughly operated our fastest and for to we the time we a share that the growth to online as XXXX. and the X% On massive. potential proportion $XX In longest, be serves the we the to compares online

I'd proven a U.S. acute Mark. particularly market we are prudent technology knowledge a model, Mr. is prevail and solutions as The backed as as drive to market, management area massive U.S. have And call which turn thrive to our leaders. by an have market, of like that to presence. the regardless online we scalable growth. global with And our With We operators and the an uniquely of proprietary of Elias success. gambling global market, the the online that, team positioned the over gambling CFO, well

Elias Mark

offering, second financial will higher to free initiatives. quarter welcome, quarter. salary in fair revenue result and The was in period was well a rate loss expenses the by financing $X.X $X.X This result diluted Operating Net expenses profit in XXXX. on the to support increase increase to in growth of our non-recurring to the our The growth the as the invest to value salary operating compared in year. technology both increased million, share, Slide initiatives. expenses by was prior U.S. to growth expenses headcount, the generated development the movements share in second $X.X in year. In XXXX. to currency is driven in of associated from EBITDA compared $X.X support by million, result approximately expenses decline million improvements increased mainly $X.X before period of second XXXX, start associated of with wages U.S. everyone. $X quarter increased monetization Free driven to the the from of organic prior result minus increased we totaled million prior increased to per of with totaled to wages as product and as $X.X XX. the performance and loss as review development. new expenditures, to $XX.X XX% comparative million was cash improved Sales cash market the was capitalized Total associated compared of $X.X we're million million primarily prior Technology the in portfolios expansion compared the our prior quarter EBITDA impacted compared with $X.X improved strategy to the $X.X quarter $X.X million totaled The assets the driven lower company's cash marketing adjusted the generated of year. XX% two expenses, And net total and headcount as defined capital income compared the million outlook. well Adjusted second to driven XX% mix. compared operations increased and of in and totaled XXXX. million million to in domain Charles, the offering revenue product in mainly of consistent million increase million totaled we of cash public $X.X by was a to which growth in $X.X expenditures year. $X.X the $X.X Thank depositing expanding in the the the XXXX. million XX%. expenses and increase year. prior cost, to with flow, increased compared operations $X.X the the management affecting as you, increased to comparable prior the diluted in senior decreased by as as related prior year, million public to second which million, million related in compared Operating administrative the The expenses Total to in with Total company's was in million our customers, million or in year. flow discussing capital compared stock, million, X% to of $X.X $X.X which of a of was acquisition per $X.XX compared I an $X.X expenses profit the attribute totaled The or in changes General compared million year. constant team. the non-recurring well to quarter our $X.X to increase $X.XX

the compared end as New $XX.X prior depositing year. of June million to to end, offering. at And compared customers compared increased public in XX of as $X.X million we XX. to $X XX,XXX XX, December totaled balances the December of $X.X quarter the in quarter the X% quarter XXXX. $X.X before XXXX. to $XX million totaled end expenses subsequent Total an million, million to raised increase million On of of roughly Slide Cash borrowings second as to operating

the For of expenditures. our the flow, adjusted of capital nearly cash half than our despite XXXX. as half our first to the free EBITDA year, compared tripled revenue the first Meanwhile, more doubled increased

customers New in the depositing Slide totaled to XX,XXX first six comparable XX,XXX in period months in the compared the prior XX. roughly year.

At we from our scale important that to deviate the of our the market margin time, no support investments are over expansion. that than maybe from note in margin target to we less average XX%. EBITDA For our target an It's targeting long-term. U.S. exceed as market annual same we're European the the the a an cycle. actor business overall we to year In revenue to share and expect gambling to business market XXXX growth average faster XX%. to become targeting take over United we In significant than States, European the time-to-time, XXXX, adjusted EBITDA adjusted growth

have following Slide At IPO. significant debt net Lastly, of On XX. ratio debt-to-EBITDA cash and under the we negative the net a we X.Xx. leverage moment target balances

in important the and It's track information either to target quarters sporting events. and exceed our potential XX% the XXXX, on on to factor acquisitions to to international or of also based target. us margin not is and weather our stronger available in achieve outlook year are full does seasonally that we're revenue our borrowings. and Northern the on first fourth keep For The adjusted in additional expected mind XX% currently Hemisphere growth based quarters calendar EBITDA

of growth the the regulated after that’s in are maintain very entering and also, and our of Netherlands Europe penetration which executing share in strong on footprint our focused our a Ontario of includes gaming gambling and markets increasing position; current market We while Australasia, U.S. market; we online legalization strategy, market coming. markets

As over you are very fit years. comments, we With step eager opportunities be ecosystem. the successful U.S. company. business take questions. we in a very We’ve listed will can profitable very tell public to about from we our gambling of the excited are to us, we And the global highly as several and built that, past our next a ahead happy and why take

Operator

[Operator Instructions].

your Our David the first Jefferies. of Katz from Please line question comes with questions. proceed with

David Katz

wanted I questions, two please. --

more and NDCs The first and around detail bit is, revenue a perspective just little per.

your on some advice us nascent give to how input helpful? the really or stage given would business, Just might how you of model be those

Charles Gillespie

David. Hi,

quarter, end market. in year our and the measures through QX the in look year-on-year, which the related is XXXX, way If you we of and back X% COVID-XX ago, place a UK, particularly you really from look the at significant to QX grew NDCs very 'XX, they had largest in if all

effect largely did almost gone is is demand as comparable measures QX. And period. gone, over those entirely of drive So, that increased the

bit of end of the we that much. So And for terms attribute NDCs we the that still into despite positive we quarter that really most outlook of to the interesting NDC year. and on -- grew we about things. revenue per so one the But the are the was two in that grew things NDCs a

little main of is bigger types, a First, But better technology. they revenue a driver onboarded other cetera. the sales. bit team, fixies have et so harder the They've of We’ve with and clients. pushed quite things tenancies, a slowed kind

increase optimum traffic have model We the sophisticated higher science revenue on than and a bets of out operators combination the traffic to of the some apply understanding yields the and websites NDC to able to for through of behavior before. drive our data been

David Katz

us the of M&A, the number front There over together, And my a the say guidance, demand days? quarters a and on the et second of question helpful? any terms putting right? couple in it has is would wire is and changed, around be listening And valuation past really of the you. even we're of If and some looking for cetera. M&A qualitative there let's anything been suggests of pieces How have in that XX commentary give them, next picture to deals to that at

Charles Gillespie

put in base get Yes. occasion and was soon perfect focused conversations the the are close as Well, as the variety touch are were a them a on we IPO, of touch we the and to begin industry the were And greatest off thing. And with extremely know was we we've IPO and coming next spoken people really let back obviously the to contact the for done, we the dust M&A to people into as also in the that past it time the in in list. that lot on of of looking with a to ice. number IPO in market of a

positive. at to conversations that really we've say in safe And So, been of progress. this point, it's a has that variety got

purposes of easier we many our of IPO fewer our We bigger general, In is have We to that tedious. can one we been that of simply in-depth conversations to have it's now transaction But peers as a options we do Lots and on. some pipeline. be Generally outlook the trying would and options of great small that to have favor are just deals deals stages -- we're is execute it's more that on different doing as pipeline M&A not was within -- completed. the as [outlift]. speaking, done. at of have the deals to

David Katz

and Do in the much the back they you perspective pretty up things on gone interesting you follow picking just that post it are left have IPO. or sense price right are up, you change can again, I them? where that up If any perspective

Charles Gillespie

do this. in specifics. Nugget size. that get expected price into deal yes, the few looking last But, three can't can't I'd at deal any been a we're and the the of in weeks. hasn't turned Score any say, obviously meaningful hate there heads. not Golden I anything I change But obviously,

Operator

Thank you.

Our next with come from with Barry Securities. question of the line Truist questions. your Jonas proceed Please

Barry Jonas

guys Thanks on IPO first out. and and quarter congrats your

how So that first, in came can your talk QX for going you give market revenue about maybe outlook much Germany and from forward?

Charles Gillespie

Elias, you want to jump on that?

Elias Mark

CPA regulatory bit and the survive towards it we've to Yeah. fairly uncertainty though we in But I'll pressure the with like. regulatory into there's of agreements pretty based thrive, in of expect look has jump six performed obviously current shift bit -- under will months. comes regulations in. We even new that strongly well and some of and Germany been been bit from done There the environment away play, revenue little little first because share a pressures. with volatility coming a market a what

Europe at our segment, in the look that, in Germany you is of revenue. If Other terms largest component

Barry Jonas

Got it.

Okay. And question. a then second

Score Would think markets’ and that increasing to affiliate how take seeing You you progression? maybe and in consolidation your Golden and get mentioned the love the Nugget impacts U.S. on the operator we're you the the deal.

Charles Gillespie

to different if were them brands continue a worked big and phenomenon. they we many Entain, with We've and work consumer-facing gambling online you is those new for now. many, added This And before many hardly those Flutter with guys bigger look brands, seen conglomerates the of like operator to years. these to companies, we and consolidation with many are

that, drive change So, to want aggregated one consumer-facing lot corporate up within we'll us even to frankly acquisition in growth the owners get best those the organizations, to figures. different get as are these doesn't for player bottom kind a in cases, the umbrella, under line many because some put assets. it And of which is -- those really brands tend talking competing regardless to of be teams whole

Barry Jonas

clarification. Great. a Got just it. And quick

include does and for Your financial that targets 'XX, 'XX M&A?

Charles Gillespie

Yes.

Operator

you. Thank

the Stifel. line coming your is Our with Stantial of with question. next proceed from question Jeff Please

Jeff Stantial

Good your start morning, for to first nicer trends. here. demand in questions and wanted Thanks on Charles, taking I congrats near-term Elias. on earnings the results

a from talk heard peers of into Specifically, on growth, a of terms in the year-on-year QX? we've some compares. what us a give is July bit Can of business, you you're decal seeing let's that just mostly in about difficult your call

Charles Gillespie

comment is and slowest the don't tend some of and and but we want U.S. of the I to peers it summer, and launches height the months NFL July going in right? [New August are very I year. think our the to of the September think of on start specifically, of like. what be ourselves too to is focused the And Space] look

Jeff Stantial

if reopening, that further mostly QX, seen in this markets? early bit late think there, great. helpful. legal your has that the you something Is some seasonally QX, bars online the et operators That's talking and trend other potential risks from still demand. some hampered the the about various also sequential here? Do really we've there Understood. as that a note, Okay, heard over specifically options On have commentary UK, across reopen headwinds, you months, you've look some summer in the out cetera we've that are played of heard

Charles Gillespie

ahead, Go Elias.

Elias Mark

agree. I Yes,

I prospectus has the the increased effect XXXX. QX to we I reversal saw from the QX took that QX commentary provided think QX. we some flowing casino casino about mean, mid it of during headwinds that to played exacerbated COVID out. trend demands a in easening through and it's restrictions, XXXX demand We've see in of which of

a to say. normal of I than would massive drop a back more it's So

Charles Gillespie

the April. The UK around pubs early in reopened

been -- April. So -- it's present effect then, to that we that since -- it's since not -- has going

Operator

Gillespie back are There hand no the questions to at call I'd like you. further Thank comments. time. any to for closing this over Charles

Charles Gillespie

everyone great day. next to joining look appreciate Group, our again, on and for your We quarter. in forward Gambling.com you a to interest everyone support updating today. Have and us really Thank we

Gambling.com Group Limited (GAMB) 26 Aug 212021 Q2 Earnings call transcript