Full year results 2020

Online shift helps Elys post record turnover and revenue for 2020

| By Robert Fletcher
Elys Game Technology, the online gambling operator and supplier previously known as Newgioco Group, for its 2020 financial year, reported record turnover and revenue for 2020, though rising costs saw the business post a net loss of $9.4m (£6.9m/€7.9m).

The business said it benefitted from customers shifting online in 2020. This helped online turnover, from its B2C Italian operations, jump 53.9% to $505.4m, with land-based facilities closed as a result of the novel coronavirus (Covid-19) pandemic.

As such, land-based turnover – again from Italy – fell 45.2% to $68.9m.

However its online growth saw total turnover reach $574.3m, up 26.5% on the previous year, setting a new full-year record for the business.

Players won a total of $530.3m in 2020, with this split $473.8m for online and $56.5m at land-based facilities.

Revenue for the 12 months to 31 December amounted to $37.3m, an increase of 4.8% from $35.6m in the previous year. This was comprised predominantly of B2C revenue, which totalled $37.1m, with a further $144,764 attributed to its betting platform services and software business.

“I am very pleased to report that Elys not only achieved record revenue for 2020 but also broke through a major milestone by surpassing our half-billion dollar objective—reaching almost $575m in gaming turnover despite the challenges brought on by the global pandemic,” Elys executive chairman Mike Ciavarella said.

“These results reflect the success of our omni-channel approach, and combining the best of both online and land-based retail betting, with balanced product diversification backed by our committed management teams.”

However, as operating expenses were up 16.1% to $44.8m, this saw the business’ operating loss widen to $7.5m for the year, compared to $3.0m in 2019.

Other expenses, including interest, amortisation of debt discount and loss on the extinguishment of convertible debt, amounted to $1.5m, which resulted in a loss before tax of $9.0m, which was higher than the $5.7m loss posted in the previous year.

Elys paid $906,644 in income tax, meaning it ended the year with a net loss of $9.9m, compared to $9.3m in 2019.

However, chief financial officer Mark Korb was upbeat about the operator’s prospects for 2021 and beyond.

“We believe that we are very well positioned heading into 2021 to execute our vision of building a premier, end-to-end sports betting solution for European and US gaming operators,” he said.

“We continue to carefully manage expenses and have a solid balance sheet with over $18.9m of cash as of December 31, 2020, which we expect will be more than sufficient to fund our planned geographic expansion in North America.”

Other major developments for Elys in 2020 included its rebrand from Newgioco, to reflect its shifting focus towards to developing US sports betting market.

Prior to the name change, Elys also established a new US-facing operating subsidiary with the aim of expanding its sports betting operations throughout the country.

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