Golden Matrix (US:GMGI)2024-11-12 11:03Stock Issuance and Acquisitions - The Company issued 1,000 shares of Series C Preferred Stock to the Sellers at the closing of the Purchase Agreement on April 4, 2024[26]. - The company entered into a Share Exchange Agreement to acquire an 80% ownership interest in Classics for a total consideration of approximately $4,430,052 in cash and 810,390 restricted shares[54]. - The company completed the acquisition of 100% of MeridianBet Group effective April 1, 2024, enhancing its market position[81]. - The Company agreed to pay $5,000,000 in contingent cash consideration and 5,000,000 restricted shares of common stock as part of the acquisition of MeridianBet Group[136]. - The total estimated purchase consideration for the acquisition was $107,942,941, with goodwill valued at $58,188,969 and intangible assets at $30,210,000[133]. Financial Performance - For the three months ended September 30, 2024, total revenues reached $40,992,329, a significant increase from $22,209,657 for the same period in 2023, representing a 84.5% growth[107]. - Revenue for the three months ended September 30, 2024, was $40,992,329, an increase of 85% compared to $22,209,657 in the same period of 2023[177]. - The B2B segment generated $4,111,174 in revenue for the three months ended September 30, 2024, compared to $232,373 in the same period of 2023, marking a 1,669% increase[107]. - The B2C segment's online casino revenue was $11,604,744 for the three months ended September 30, 2024, up from $8,906,040 in the same period of 2023, reflecting a 30% increase[107]. - The total revenue contribution from MeridianBet Group for the nine months ended September 30, 2024, was $75,768,638, resulting in a net income of $8,477,531[135]. Expenses and Liabilities - The Company incurred amortization expenses of $1,962,157 and $420,801 for the three months ended September 30, 2024, and 2023, respectively, and $4,317,523 and $1,357,453 for the nine months ended September 30, 2024, and 2023, respectively[35]. - General and administrative expenses rose by $10,516,288, or 82%, to $23,379,550 for the three months ended September 30, 2024, largely due to stock-based compensation and increased salaries[179]. - Interest expense surged by $786,144, or 19,416%, to $790,193 for the three months ended September 30, 2024, primarily due to the amortization of debt discount[180]. - Long-term liabilities amounted to $35,265,611 as of September 30, 2024, compared to $0 as of December 31, 2023, reflecting the company's recent financing activities[78]. - The company recorded a debt discount of $3,322,177 related to the issuance of a secured convertible note, with an unamortized debt discount of $2,593,118 as of September 30, 2024[78]. Cash Flow and Capital Management - Cash provided by financing activities was $32,716,355 for the nine months ended September 30, 2024, mainly from loans and convertible notes, compared to cash used of $3,063,919 in the same period of 2023[173]. - The increase in cash of $17,999,655 between September 30, 2024, and December 31, 2023, was mainly due to proceeds from loans and borrowings[173]. - The company may need to seek additional capital to meet obligations and support operations, which could lead to shareholder dilution if additional equity is issued[171]. - MeridianBet Group had $38,404,951 in cash on hand as of September 30, 2024, sufficient to meet current working capital and capital expenditure requirements for at least twelve months[168]. Taxation - The company reported an income tax expense of $1,864,122 for the three months ended September 30, 2024, and $2,670,788 for the nine months ended September 30, 2024[115]. - The company had accrued a tax expense of $1,468,472 as a contingent liability for a tax dispute with Greek authorities[116]. - The statutory tax rate for the company's operations in the United States is 21%, while in Australia it is 30%[110]. Assets and Inventory - Total inventory was $4,414,399 as of September 30, 2024, up from $133,905 at December 31, 2023[37]. - The inventory of prizes increased to $4,286,893 as of September 30, 2024, compared to $0 at December 31, 2023[36]. - As of September 30, 2024, total deposits and prepaid assets increased to $5,997,157 from $5,586,495 as of December 31, 2023, representing a growth of approximately 7.4%[68]. - The company recorded total intangible assets of $65,312,279 as of September 30, 2024, up from $21,977,966 as of December 31, 2023[64]. Shareholder and Management Compensation - The total salary paid to CEO Zoran Milošević during the three months ended September 30, 2024, was $25,671, compared to $4,321 in 2023, reflecting a year-over-year increase of 495%[84]. - The company granted 250,000 restricted stock units to CEO Zoran Milošević on May 9, 2024, as part of his employment agreement[84]. - The total salary paid to Ms. Božović during the three months ended September 30, 2024, was $25,671, compared to $4,321 in 2023, marking a significant increase[86]. - The Board approved an increase in the annual base salary of Mr. Brett Goodman to $108,000 effective August 1, 2024[38]. Market Presence and Strategy - The Company has subsidiaries in multiple countries, including Australia, the United Kingdom, Mexico, and Serbia, indicating a broad market presence[27]. - The MeridianBet Group operates in 15 markets across Europe, Central and South America, and Africa, employing approximately 1,200 personnel[141]. - The company has established revenue-sharing agreements with numerous third-party casino providers, enhancing its game library and customer engagement[143]. - The company aims to maintain organic revenue growth in all B2C markets and expand its global reach by obtaining gaming licenses in existing and newly regulated markets[166]. Technology and Innovation - The integration of advanced Machine Learning technologies aims to personalize user experiences by providing tailored bets and real-time odds updates, reducing manual oversight[145]. - The MeridianBet Group has developed 52 in-house slot games available online, enhancing its proprietary casino platform[143]. - The company is committed to investing in technology and innovation to enhance its product offerings and improve overall margins[166].