GAMB - Earnings call transcript Q1 2022 | Gambling.com Group Limited

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Greetings. And welcome to Gambling.com Group First Quarter 2022 Earnings Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. to Investor conference Relations like host, to now Carroll, Josh for would turn over the your I Gambling.com Group. you. Thank

begin. may You

Josh Carroll

Hello, available at is by available Gambling.com results to Elias Mark, Officer everyone. quarter Officer. the Investor replay and live on presentation And earnings This within Financial downloadable is XXXX call and there Group’s Co-Founder; version call. webcast Gillespie, conclusion call. Charles well. a first website joined Chief Chief being of Executive I’m will Relations section the be gambling.com/corporate/investors of the after of and our webcast as website A this the welcome

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

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

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

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

Charles Gillespie

reported Josh, our financial you, Thank history. we showed that results performance morning best quarter Group’s quarter the first the XX-year in This and welcome, everyone. single

following deck, with am I four. the along If you’re now on slide slide

business core quarter. all performs Our brilliantly

our growth growth organic XX% are drive combined against offset was with as QX which strong helped growth delivered consistent prior to the investments best our organization quarter. performance substantially initiatives. we organic with revenue recent year, XXXX, acquisitions the in support Continued higher revenue adjusted EBITDA our the increased the We making previous

and delivered flow, data Our XX% This increase adjusted a portfolio. the EBITDA XX% we and an expansion customers, in was cash despite positive continued new free websites wide. our margin continue and domain us XXXX. record are QX of investments organization against in making sites. increase we quarter science the delivered XX,XXX depositing driven in names, our technology investments benefit portfolio The to partner by of was domain We

Now I’m slide five. on

revenue. which of we customers empirestakes.com information market websites the among believe will of driver market U.S. was the in XXX% successfully New where for continue bettors of XXXX. terms Gambling.com. trading, followed Shortly we Trading delivered the solid been in continue two and strategic complement presence Louisiana QX EmpireStakes. key Online we over on depositing developed on especially representing period the state’s trusted, time launch after We new the of state. can The saw seen York and sports Group U.K. launch, sports majority of a North to American North a up-to-date betting grow the These find in when our $XX.X year, in leaders newyorkbets.com levels be restrictive York, January, of We American increases to in in market, and deliver our measures. launches that end. also million, Ontario the saw Booking.com revenue comfortably launched number quarter have According coming date first during shortly new North objective sports them. growth after COVID to over the during well performance and the and years. specific revenue by growing ahead we website the to anticipated York to class master comprehensive America clients, additional New flagship our the outside entered was of anticipation temporary we launch of betting a demand in strong sports last betting of considered New launch comparable delivered In ahead our to with the

providing Work preparation strong Our a in the great acquisition, beyond. applying media a platform delivering delivered a seasonally well start partnership and is positioned to customers. in and Likewise, RotoWire stronger platform of to incremental where new recent announced and the the the acquired also BonusFinder.com is proving to acquisition meaningful off U.S. for January, sports on marketing nicely the in is QX new expand progressing performance fall of market in to quarter RotoWire.com be in Canadian to and beginning quarter at in revenue customer drive our great revenue. our the season got already numbers with depositing depositing McClatchy strong

slide six. on Now

investments North we’re quarter in has growth the of drive making validation America. organic to first a Our served strong

portfolio possess market sports of betting on legalization Our names names premier of assets awaiting in its domain has for iGaming and already many value additional more online standby we domain and U.S. states. demonstrated the

which over our investments New will premium capital these time. sites maximize ROI on the developed on domains platform, being are in-house these for technology

seven. slide on Now

state few new total the greatly market. we have the in expand seen addressable past launches the Over months, U.S.

launch in online customer The for Louisiana been was pipelines. Shortly given develop around March Initial expectations of time previously York Bowl been same Xth on in online highly Xth. market market expectations. the launches. anticipated out Likewise, sports the New our successful in sports did we live see casino the Arkansas has of in Group date are in in but launch available to well York’s online and betting betting as market exceeded have betting quarter our in The below on and we the New mobile the launched than end one well new in operators managed our Ontario officially Madness. time newly state the followed slow operators of launch demand April successful its the XXth positioned, had acquisition for Louisiana. rates Arkansas a spike typically and by launched In seen January launch time sports Ontario has earlier March conversion happened partners Super after for their QX on regulated with online been work U.S. kinks launch. at years, with gambling in that Canada only Ontario, in readily not launch

With the the expect market at acquisition Canada of and thrive BonusFinder.com we well positioned to scale. are across

of We of rest the in their focus expect Ohio the and Maryland, do now that but legislated all XXXX not already yet For either the regulated on launched have for NFL time which state betting, launch not season XXXX. these is Kansas, QX the markets. at or previously is the have even QX Likewise, sports date yet as legislated, betting of we clear. the see which sports We year. of had online launching late launch of states recently in will not anticipated in start in September,

to financial our turn I our CFO, to would the quarter first to in greater over Elias call Now Mark discuss performance like detail.

Elias Mark

Charles, Thank everyone. and you, welcome

the half mentioned, history. quarterly delivered we Charles best our As in start second the a saw Group’s during business we pay in performance really investments to the XXXX of off and

media constant primarily revenue currency new North recognizing to quarter increase XX% driven market This by operating well First currency to growth partnerships $X.X American expenses January our cost [ph] Sports. driven of of a year from We million In sales and consensus. million. ahead our amortization million. on operating first as basis additional we recent related with primarily functions, incurred recent basis, headcount of of constant recently million was as the our by to customers and new sales a acquisition. as $X.X in prior growth $XX.X our was increased was marketing, RotoWire.com. within Total depositing $X.X The On across The increase quarter organic of increased revenue the increased result growth expenses XX% in increased subscription the a primarily acquired the product by million. business in compared acquisition. or complemented vertical began $XX.X

During incur to XXXX, to related $X.X additional we expect op of billion expenses the approximately acquisition.

operating We a have administrative expenses in also the associated increased Group. company public with as

our that’s years states path. into grow clear substantial see return business we existing to the continue coming investment that launch. a new and over states invest on There’s as We a

inflationary compared offset $X.X are share income revenue. or margin in $X.XX million, some as flow. those increasing We jurisdictions diluted Like This to by we do EBITDA million net income in higher prior pressures generating so $X.X to our the positive of adjusted and seek of organization expenses we and while XX%, able we of more the proportion $X.X retaining per diluted for per million are are high million $X.X adjusted EBITDA pressures the represents of year. share our rest efficient experiencing an of generated in cost prior investments with compared scaling world, the Net cash year. We totaled operating and by as the expand. mitigate margins free $X.XX the to

This generated as of to net American fair decreased in revenue on impacted earn-out adjusted longer of in quarter will end related the the Looking was of period. as well million XXXX. end for considerations Total driven income result this operations Like per average by present we forward, credit income diluted net QX $X.X beginning of the comparability, revaluing XXXX. contingents in acquisitions. second to until per be as because a share expansion proportion $X.X the slightly value we expect to movements net increased North primarily cash by income rapid income fair at movements and of compared million net period and value and growth, the with revenue continuing BonusFinder.com capital diluted the significantly working from share our the

generated expansion coming cash gradually and flow operating our We organic initiatives remain our and of portfolio. conversion remain continued positive. domain working expect from cash free $X.X free flows the investments We fund to still growth months. over flow cash capital to improved our despite cash in entirely million the able We

and decrease million. and offset a acquisitions The at of well was for by recent of compared flow. $XX million the acquisition the the as partly XX, in consideration quarter Ireland. as the as by retained $XX solid XX,XXX of North compared March in prior the balances XX% American XX,XXX, as U.K. year. We in as customers depositing to well RotoWire.com the totaling paid this year result cash Sports, driven the our end New as of performance last cash BonusFinder.com, to the cash XXXX, was domain This to and operating grew

strong to We are the expect and year business year the and Group, of another both core acquisitions record very pleased performing we by for continue to start are our well. our as performance the financial

balance XXXX, are exposure experienced As than American historically. we given of we subject seasonality look our the we to natural to have deeper calendar, to Sports patterns growing North

quarter with of is seasonally the into stronger March April of throughout seasonality first strongest This a the by the and with being September second the weakest launch third season followed the The period and seasonally month. months two sports the negative NFL is continuing continuing quarter. with starting

first in are Our of pull-forward very forcing April than of earlier The expected quality market affected the launches. and revenue initially New growth successful timing expected, the market York into some the also initially expectations we launched quarter. by new

pushes towards in revenue of the guidance rather Maryland into QX from occur On and Ohio year, of launches are slide we QX nine, likely XXXX of XXXX. than expect in QX XXXX. Looking we to or for looking market some and towards end more now reiterate QX our in This half that second to expected September. the the

to of We $XX of XX% to growth revenue in the XX%. expect million $XX representing range million

also between I adjusted $XX back With million representing $XX XX%. to million XX% EBITDA expect will We growth that, Charles. to turn of and call the

Charles Gillespie

Elias. you, Thank

see online I slightly time end the at legalize market A see with horizon of bit longer and developing with today exciting November deck a now slide will and where you betting. the California to medium-term. perspective a we additional in on we the developments are sports in of ballot leave the We initiative

the expansion legislature We’re also with market XXXX California TAM either professional be that the of some teams largest populous seriously state our sports in the U.S. most as consider to Texas very the Texas in will or states would significant to the betting in world, sports indeed. the when reconvenes hopeful include of

-- We and have websites strong we potential capitalize that the the would a and of very position in states, these of opportunities. we already there on launched BetCalifornia.com to be regulation believe in would the BetTexas.com anticipation be

like the I the Carolinas closely BXC model. how profitability also would to watching BetCarolina.com. we are we operators clear pay-for-performance positioned offer with to pure reiterate developments with are believe path also where we a our We across in U.S. to

deliver As our worth. can ROI interaction a perfect customer BXC have every operators come attribution to actually know the in heavily customers leading what reminder, With invest when online therefore to clients, their channel. clarity and on to traffic we confidence this where and are be operator gambling really they can tracked, affiliate from

remain years spend we among operators European We spend forward, robust marketing from to Going even where marketing expect trends is BXC overall affiliate reduced. in saw U.S. operators similar past.

marketing bet affiliate on of partners. their that the short confident efficiency spend, of will with to increasingly they thing increasingly are grow operators their choose a marketing We has conscious U.S.

to team up our ever. was be happy record quarter With we’d delivering Finally, that, thank fantastic line for for performance during to open absolutely busiest what another like I’d questions. our surely the

Operator

Our you. line the question Thank comes [Operator your Barry with Truist Instructions] Please Jonas of question. proceed first Securities. from with

Barry Jonas

Can quarter? from M&A recent you and about maybe talk were guys. you the EBITDA of Hey, same-store how contribution the trends maybe in saw level just Great.

Elias Mark

Yeah.

came more look gradually a contribution BonusFinder.com marketing if the with And margins affiliate And improve contribution acquisition performance through business our mature plan it marketing. has expected, organically Roto assets. as in lower margin their business. that and our other in we -- margin to line subscription applying developed acquired we about, have we talked our as contribution think I that previously is at in growth at

Barry Jonas

which And Is there the you that just can clarify and new is it. just the else timing in Got can -- jurisdictions difference low anything difference? between largely Got terms comment the it. then high of guidance, or you of could the end end? drive the

Charles Gillespie

of and is, in Maryland, Barry, land on biggest Ohio be based range. the eyes markets those and where all to really the It live, really determinant going are go on when that’s we

Barry Jonas

And you the could talk maybe Great. versus share can one Can mix versus I if in the you Okay. sneak hybrid quarter? just more. in -- give of CPA rev about

Elias Mark

Yeah.

revenue, CPA. an U.S. increasing the higher proportion of of of have which on a by largely back proportion We is CPA driven

Barry Jonas

Okay. trend continue? Presumably that expect we should to

Elias Mark

change And than where the movements exclusively But they. over at yeah, market U.S., almost we next That the coming years. it could when Europe, the why we look that’s CPA. starts is in dynamics more the -- market well have market

Charles Gillespie

by And will U.S. add, quarters, I be which will more are seasonally more heavy. the heavy for sports thus definition kind CPA of

of be QX So less sports parts it driven. QX happening, and CPA with less would

Barry Jonas

Got it. Thanks so much, guys.

Operator

Thank you.

Our comes with Please proceed Stifel. line question of Stantial question. from with Jeff next your

Jeff Stantial

marketing as the the to accelerating on just a for if to I around to I RotoWire conservatism guidance morning, Thanks. wanted coming specifically the With drill implies, in and that decision there assets. that Good should Intuitively, a -- fairly front, nice mind, the a into the seasonality is curious front stable, considering? and questions X% you into stays or bit tax, margins, on this more in just be quarter we quarters acquired which should headwinds on roll we that out guys. cost quarter. to on would Hey. not the in are XX% in leave Thanks here. think, performance came I reiterate guidance congrats the think decision you margin taking XX%

Charles Gillespie

HX end RotoWire really which plan in With to roll improvements the it margin we up the closer. for margin season, Yeah. will effect definitely might and same NFL the an be that out verticals, gradual. that quite we business towards we regards We our be of but are business, that’s the really for should year, lot on a a so this other the to would contribution the be time expect we to not

compare We XXXX, QX have run to at we significantly been scaling OpEx we higher a already. If QX rate. XXXX are

would rates the did look throughout to to if flagging collectively, delighted we quarters, and lower be the same revenue to our invest flagging, negative that that see we think… would we next in that seasonality, growth are imply margin, XXXX. they’re into continue subject We hire you expect of to should natural which I fixed imply couple not we’re But XXXX that and be cost to we’re going

Jeff Stantial

Got Understood. it.

Charles Gillespie

that’s -- understood. largely expectations market factored into It’s Yeah.

Jeff Stantial

recessionary Understood. you maybe thematic And more in Thank a on advertising tangible taking see ROI in you. back space in one, step then a more take That’s environment given just helpful. that prevailing marketing share view broader that performance digital a marketing spend. a there’s market should just the

your any across of some we’re curious markets. think of Just argument in kind the panic you reacting base equity of far and that seeing thus evidence your if the seeing client on behavior that you’re to thoughts

Charles Gillespie

affiliate but relationships. that it’s expect can it lot of I are then a by makes of only war our really we operators see what perfect kind day-to-day outbid turns when to model clients, not and a lot -- being sense, their exactly maximize of we not, bidding so the those already up. -- can come much, think kind to virtually it see, prices prioritize and Jeff, you they’re of and all clients the with everything they It’s yeah, into a doing would other thrive perhaps, our main and

marketing care the investors seem marketing just market an choice easy I think get marketing prioritize such these the departments affiliate is you there. right in to is now performance profitability for to and a path how it’s to U.S. about clearly really really, and

Jeff Stantial

Thanks, That’s Charles. awful. Great.

be I U.K. to just thoughts pending then, latest review. regulatory get if I more, can squeeze on your the So maybe in curious one just

any you’re be just would the but lawmakers the approach potential on latest taking helpful? rational a like there hearing color are changes, to Sounds pretty what’s

Charles Gillespie

about But begin is with. watered it’s being that down. it concerned weren’t particularly The to chatter have we latest seen I

are story about finally relaxed the ending kind of can suggest So recent and about everyone even headlines that. questions coming. can it’s relaxed and never be Hopefully they’ll with it like this. release it’s more we when asking something stop just But the we that quite

Jeff Stantial

Great. pass you it Helpful on. I’ll Thank both. and encouraging.

Operator

you. Thank

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

David Katz

us my morning, going We you tailwind and somewhat Other to one that delve is And of if sort Netherlands Good just respect guidance the be in a be a help seem what into would Hi. Europe the Other remember taking that to little U.K.? everyone. Europe. wanted for I helpful? was of point just non-U.S. questions. to at embedded could Thanks for deeper with portion, to unpack

Charles Gillespie

performance Yes. we our very less we U.K. exceptionally the a and compared our to strong revenue look at If performance in an solid QX, in XXXX. QX was had Ireland, in where

Our of We on changes Other that that the back was were continuing. Germany that’s doing see is business U.K. Europe very in the in well. and implemented kind down July. of regulatory

The Sweden strong. particularly other within components Europe, Other was

in I’ve in they guidance operator of uptick We in expected get they’re not it it still it who business potential QX, in seen remains of remains stage, is small seen. an part the unclear going a still in the have trading this future. have big market our or those when QX some expected Netherlands, that don’t The licenses, of the the the are very in really to a has at seen leaders some there but Netherlands Netherlands be lot the to

David Katz

if it Netherlands, upside about that up you’re accelerate, that, that right, can follow the right, come what that your guidance point potential to is be is in pass it were effectively, think, the So baked with occur? if discussion suggesting if would I does and and I to to conservatively that just

Charles Gillespie

Yeah.

business Netherlands in have guidance. any from any factored not the We significant in

David Katz

like, And I for think you’re It which Charles, I understand, And if unusual Ontario your a little the said, comparable just what to have underperformed really has Ontario, expectations that you? an frankly, be may market, may, U.S. you in to -- seem are seeing back wanted to right? bit, expectations doesn’t help to the Perfect. for it’s we’re is, it what us Okay. go I

Charles Gillespie

as and U.S. the the that was expectations. unique underperformed saw seen conversion teething that Canadian were it’s just that first operator there’s when have rates operators regulated said Basically, our it’s kind first the in And just been have because, launching the states and market, market, of some work U.S., you new partners kinks say, and a in frankly, with out. pains we had that this I the have we to the

and things improved, So fixed all then issues money. go conversion and get everybody up are those minor makes rates and more

of we’re our -- But equally So York, for and very Canada. positive very it the what numbers healthy. New a but wasn’t expectations are future pretty we’re healthy Ontario it’s are future confident the and -- the like and blowout about

David Katz

or Understood. into next can you One last bit whether one, us any a more if window could or I would more give M&A may, there be XX just wouldn’t months?

Charles Gillespie

do on any providing say very M&A fantastic deals were we that, last think M&A guidance at happy and we’ve specific this two We’re those year focused on point. very are will we the deals. were not I to and done

specific and this to we another one feel opportunistic we very any to be don’t point, at do. the next we’re So about deal and pressure picky do going

course, got two recently. of full hands just the our we’ve we integrate up, businesses We’re, thought we’re

So be one. the possibly successful those is before as focus on after they deals the next can race making we as really

David Katz

Understood.

Elias Mark

I think that…

David Katz

Okay.

Elias Mark

we carefully next expect would of monitor up the close anything environment be industry, I opportunities very in in continue and open this market the be to that I quarters. to wouldn’t couple think that but

David Katz

Perfect. Thank you.

Operator

Thank turn any back you. I’ll question-and-answer that comments. floor gentlemen, Ladies our the final concludes for Gillespie session. and Mr. to

Charles Gillespie

outside U.S. us the the and absolutely for your joining about Gambling.com fantastic appreciate we year, our of the today. prospects had We an and Thanks again in record the quarter extremely for everyone Group. rest year, in excited to the U.S. to interest We’ve are both support and start

we Thank to very in August. you QX report when again much. everybody updating we So forward look

Operator

today’s Thank concludes This you. conference.

for participation. this You Thank your time. at may disconnect your you lines

Gambling.com Group Limited (GAMB) 31 May 222022 Q1 Earnings call transcript