Gambling solutions provider GAN reported record revenue for the first quarter of its 2022 financial year, driven by a 70.6% increase in revenue from is B2C operations.
Group revenue for the three months to 31 March 2022 was $37.5m (£30.3m/€35.9m), up 38.4% from $27.1m in the corresponding period last year.
GAN said it experienced growth across both its B2B and B2C segments during the quarter, but it was the latter that contributed most to the overall increase in revenue.
B2C gaming revenue was up from $14.3m to $24.4m, helped by the acquisition of the Coolbet brand in January 2021. GAN said strong organic demand for the Coolbet product offering led to a 57.0% rise in the amount wagered by customers during the quarter.
Turning to B2B and revenue here was 4.7% higher at $13.0m. Platform and content fees for the quarter reached $10.7m and development services and other revenue $2.4m, though GAN noted that the prior year included $3.0m worth of patent licence revenue, which did not recur in Q1 of this year.
Looking at spending during the period and total operating expenses were 29.6% higher at $41.6m, with costs higher in all areas, with the exception of general administrative spend, which was down 6.0% to $9.4m.
As spending exceeded revenue, this left an operating loss of $4.1m, though this was an improvement on the $4.9m loss reported in Q1 of 2021. Other expenses for the quarter were minimal, so pre-tax loss figures were the same as operating loss.
GAN paid $386,000 in tax, which left a net loss of $4.5m for the quarter, shorter than the $5.6m loss posted at the end of Q1 2021.
The provider also noted that its adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) for the quarter rocketed by 453.3% from $537,000 to $3.0m.
“We delivered an encouraging start to 2022 driven by organic revenue growth in both our operating segments coupled with cost rationalisation efforts to deliver strong growth in adjusted EBITDA,” GAN chief executive Dermot Smurfit said.
“We continue to demonstrate the value of our integrated B2B and B2C portfolio, soon to be joined on one unified platform and our ability to deepen our presence in both new and established markets as we add to our offering.”
Smurfit also highlighted a number of events that happened after the quarter that could help drive further growth in Q2 and beyond. These included launching PlayEagle.com for Soaring Eagle Casino & Resort in Michigan in April, while the Coolbet brand also went live in the Canadian province of Ontario in the same month.
“We expect each of these efforts to drive significant year-over-year revenue growth which, when coupled with our laser focus on profitability, will yield much better scale and improved margins compared to last year,” Smurfit said.
As a result of its first-quarter success, GAN was able to affirm its previous full-year forecasts for 2022. These include achieving revenue of between $155.0m and $165.0m with adjusted EBTIDA expected to be in the range of $15.0m to $20.0m.
