Growth was evident across both the Media and Platform and Sportsbook arms. However, it was the former where GiG reported the most success, with GiG Media revenue rising 49.0% to €22.5m.
This ongoing growth is all the more impressive considering it is taking place amid significant changes at GiG. In February, the group announced a strategic review whereby its Media and Platform and Sportsbook divisions would split. Each will run independently as publicly listed companies.
Also add in that Richard Brown has stepped down as CEO, with Jonas Warrer taking on the role on an interim basis. Warrer has also agreed to serve as CEO of GiG Media, with Richard Carter to lead the Platform and Sportsbook division.
However, despite this disruption, growth continues at GiG. Chairman Petter Nylander says this is testament to the group’s long-term expansion plans.
“We continue our journey towards becoming world leaders in the igaming industry, focusing on our two core business areas, Media and Platform and Sportsbook,” Nylander said. “The third quarter of 2023 has proven to be another period of growth and achievement.
“GiG has demonstrated its resilience and commitment to excellence by achieving all-time high revenues in Q3 2023.
“As we reflect on the strong results of Q3, we are enthusiastic about the future. Our ambition to become and create world leaders in both Media and Platform and Sportsbook segments we believe is well within reach.
“The dedication and hard work of our team, combined with the strength of our strategy, have positioned GiG for an exciting journey ahead.”
Revenue rises despite seasonability effects
The revenue figure reported by GiG is adjusted for revenue from a platform client where GiG recognises the full operations in its profit and loss statement. These, is says, are partly offset by related cost of sales and site overheads.
Without this adjustment, full revenue in the three months to 30 September was €35.1m, which was 28.1% higher than last year. This is despite the impact of normal seasonality effects, due to the summer holidays and lack of larger sports events.
GiG also notes the impact of unfavourable sports results in Q3. It says these results caused an estimated €900,000 hit in revenue in September alone.
GiG Media continues focus on revenue share agreements
Breaking down this performance by segment, GiG Media was the main source of revenue at €22.5m for Q3. Paid media represented 25% of divisional revenue, with 63.0% coming from revenue share agreements, 9% cost per acquisition and 27% listing fees and other services.
GiG say it is continuing to focus on referring players on revenue share agreements. This, it says, allows it to secure further recurring revenue streams for the segment.
Among many highlights for GiG Media in Q3 was GiG Media securing approval to launch in Kentucky. This brings its total US licences and vendor registrations to 13, allowing it to operate in 25 states and Washington DC.
Platform and Sportsbook revenue up 19% in Q3
Turning to Platform and Sportsbook, revenue increased 19.2% year-on-year to €9.3m. Of this total, 82% came from platforms operated in locally regulated or soon-to-be regulated markets.
GiG also referenced geographical performance for the division. Some 58% of all operator revenue in Q3 came from Europe, 23% Latin America, 12% North America and the other 7% rest of world.
Q3 highlights were five new brands going live, including Crab Sports with both a platform and sportsbook in Maryland. GoldenPark also entered the Portuguese market and Betsson-owned brand Rizk went live in Serbia.
GiG net profit climbs to €8.8m as costs are reduced
Looking at spending, cost of sales edged down to €1.2m while operating costs were also cut by 40.4% to €10.4m.
As for other costs, depreciation and amortisation hit €3.1m and the amortisation of acquired assets was €3.4m. GiG also notes €4.5m in finance expenses and a further €1.3m in costs related to unrealised exchange loss on bond.
This left a pre-tax profit of €10.7m, up 723.1% year-on-year. GiG paid €1.6m in tax, took off €155,000 in profit from discontinuing operations and accounted for a €142,000 negative impact of foreign exchange.
GiG ended Q3 with a net profit of €8.8m, up 2,168.2% on last year. In addition, EBITDA was 187.2% higher at €23.1m.
Year-to-date revenue nears €100m
As to how Q3 impacted its year-to-date performance, GiG says revenue for the nine months to 30 September was €98.7m. This is 35.0% up from 2022 and just shy of the total €101.7m generated last year.
Operating expenses were level at €49.6m while, after accounting for all other costs, pre-tax profit was 307.6% higher at €21.6m for the period.
GiG paid €1.7m in tax, discounted €675,000 in profit from discounting operations and noted a negative impact foreign exchange of €142,000.
This left a net profit of €19.0m, an increase of 578.6% on 2023. EBITDA was also 114.8% up to €47.9m in the year-to-date.
“Together, we are shaping the future of the igaming industry and we look forward to sharing even more exciting milestones in the quarters to come,” Nylander added.