Gambling.com Group’s revenue climbs 66% in Q2

| By Robin Harrison
Gambling.com Group chief executive Charles Gillespie described the business as “among the most profitable names in the online gambling industry” after the operator’s second quarter results revealed a 66.0% increase in revenue, and a $2.4m profit.
Charles Gillespie CEO Gambling.com Group new headshot

In the affiliate marketing giant’s first set of results since listing on the Nasdaq Global Market in July, revenue grew from $6.3m in Q2 2020 to $10.4m (£7.6m/€8.8m). 

This was driven predominantly casino referrals, with the vertical contributing $9.1m of the total (up 63.1%), though the biggest hike in revenue was recorded for sports betting. 

Following the launch of sites such as EmpireStakes, BetArizona and IllinoisBet, as well as the acquisition of two domain portfolios targeting the US, sports betting revenue was up 125.9%, to $1.2m. There was a slight decline in revenue from other sources to $135,000. 

The Gambling.com Group’s revenue came predominantly from the UK and Ireland, which accounted for $5.4m, with a further $2.8m generated from other European markets. North America’s contribution also grew, rising 28.4% to $1.4m, while a further $752,000 came from the rest of the world. 

In terms of where this revenue was generated, hybrid commission deals made up the majority, bringing in $4.6m, followed by cost-per-acquisition commissions, at $3.6m. Revenue share accounted for a further $1.1m, with the final $1.2m coming from other sources, mainly down to the business hitting performance targets for operator clients. 

Turning to outgoings, sales and marketing expenses for the second quarter rose significantly, to $3.1m, with technology outgoings growing to $944,000. The biggest rise was recorded for general and administrative expenses – most likely related in part to its public offering – to $3.4m. 

After $240,000 credited in relation to allowances for credit losses, Gambling.com Group’s operating profit was down marginally, falling 3.2% to $3.2m. 

However, its bottom line was positively impacted by reduced finance-related costs. For example, the business recorded a $2.8m loss on financial liability at fair value through profit or loss in the prior year, with no such charge in the Q2 2021 figures. 

Finance income also rose significantly, from $23,000 to $394,000, and finance expenses declined marginally to $524,000. This resulted in a swing from a $128,000 loss before tax to a pre-tax profit of $3.0m. 

After $582,000 in income taxes, the Gambling.com Group’s net profit for the quarter came to $2.4m, compared to a $428,000 loss for the prior year. Once a further $490,000 credit from foreign exchange translations was factored in, its total profit came to $2.9m. 

Adjusted earnings before interest, tax, depreciation and amortisation (EBTIDA), which also factors back in non-recurring bonuses, one-off accounting costs related to its listing and share-based payments, came to $5.5m, up 46.0%. 

Chief financial officer Elias Mark noted that the second quarter results came in at the high end of its projections. “We also continue to produce strong free cash flow and we remain in a solid financial position after the public offering last month,” he said. 

Chief executive Charles Gillespie (pictured above) added: “Our second quarter results (which were our first interim financial results as a public company) were highlighted by continued strong top-line growth, and, based on our adjusted EBITDA margins, we are among the most profitable names in the online gambling industry.” 

“Since our founding in 2006, we have built an affiliate marketing powerhouse with recognisable brands around the globe,” he continued. “Players trust our services to help them find a safe, fun and legal betting experience while our B2C operator clients utilise our best-in-class technology platform to support their increasingly important customer acquisition initiatives. 

“We are incredibly excited about the next step in this journey as a public company and look forward to sharing the success with our new investors.”

The strong second quarter contributed to revenue for the six months to 30 June more than doubling to $21.9m. After sales and marketing, technology, general and administrative expenses and credit allowances, operating profit for this period also rose significantly, up 149.9% year-on-year to $8.4m.

Once finance income and expenses were factored in, its pre-tax profit climbed to $8.2m, with net profit coming to $6.9m – up 60.5%. With foreign exchange translations factored in, this rose to $5.7m. 

“We are carrying encouraging momentum into the second half of the year,” CFO Mark added. “As a result, we are expecting to achieve or exceed our revenue growth target and adjusted EBITDA margin target for the full year 2021 before the effects of any acquisitions and without incurring further borrowings.”

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