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Golden Matrix eyes US and Canada launches after “constructive” FY22

| By Robert Fletcher
Online game developer and licensor Golden Matrix Group (GMGI) set out plans to enter the US and Canada via its pending acquisition of MeridianBet Group, following a “constructive” 2022 in which it reported significant revenue growth.
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GMGI earlier this month revealed that it had struck a deal to purchase B2C sports betting and gaming business MeridianBet for approximately $300.0m (£242.7m/€276.5m), which would mark its entrance into the B2C market.

With the deal expected to complete before the end of the first half, GMGI chief executive Brian Goodman said the the addition of MeridianBet to GMGI would enable the business to grow its global operations, with a particular focus on North America.

“This will significantly advance GMGI’s global footprint with numerous B2B and B2C product offerings on most continents and, we believe, create the opportunity for us to participate in online gambling markets in the US and Canada,” Goodman said.

“Combined pro forma revenue of Golden Matrix and MeridianBet is expected to be greater than $100.0m for FY2022, with adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) estimated to be greater than $22.0m for the pro forma year ended 31 October 2022, making the combination financially appealing and earnings-accretive.”

Revenue increase

Goodman’s comments came as GMGI published its 2022 financial year results, with revenue for the 12 months to 31 October amounting to $36.0m. This was a 218.6% increase on the $11.3m posted in the comparable period in 2021, with GMGI switching to an October year-end date from the previous 31 December.

This increase was driven by the acquisition of a majority holding in UK-based prize draws brand RKings in November 2021, with GMGI having purchased the remaining shares in the business in November of last year, taking full control of the business.

In terms of spending, total operating expenses for the year reached $9.0m. This included $5.4m in general and administrative costs, which were some 315.4% higher than in FY21 due to spending related to the RKings segment.

After including $270,585 worth of other income, primarily foreign exchange gain, this left a pre-tax profit of $463,077. GMGI paid $419,049 in income tax and also noted a $294,066 net loss from a non-controlling interest, meaning it ended the year with a $250,038 net loss.

Though GMGI did not publish full figures for the comparable period in the previous year, it did reveal non-GAAP adjusted EBITDA for the 2022 financial year was $3.5m, up 45.8% from the comparable 12 months.

“This has been a highly constructive year for our rapidly growing company,” Goodman said. “We believe the increased costs incurred and investments made in our B2B and B2C platforms have positioned GMGI to sustain and even accelerate our strong revenue growth. 

“To remain competitive in the worldwide gaming industry, we are continually upgrading our systems and gaming content offerings to support the needs of our millions of participants.”

Mexican launch

Goodman also noted the potential for growth in Mexico, with GMGI in November launching a new, proprietary B2C online casino in the country. GMGI is expected to begin generating considerable revenue in the first half of this year from the Mexican site, which is offering online casino, sports betting and the RKings Tournament product.

“We believe it should serve as the first major step toward GMGI’s planned expansion throughout Latin America,” Goodman said.

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