Gambling.com (GAMB) - 2024 Q3 - Quarterly Report

FINANCIAL INFORMATION FINANCIAL INFORMATION This section presents Gambling.com Group Limited's comprehensive financial data, statements, notes, and operational review Financial Statements Unaudited interim consolidated financial statements for Gambling.com Group Limited as of September 30, 2024, are presented Interim Condensed Consolidated Statements of Comprehensive Income (Unaudited) Q3 & Nine Months 2024 vs 2023 Performance (USD in thousands) | Metric | Q3 2024 | Q3 2023 | YoY Change | Nine Months 2024 | Nine Months 2023 | YoY Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Revenue | $32,118 | $23,458 | +36.9% | $91,874 | $76,122 | +20.7% | | Operating Profit | $9,603 | $4,715 | +103.7% | $25,815 | $13,608 | +89.7% | | Net Income | $8,509 | $5,013 | +69.7% | $22,746 | $11,886 | +91.4% | | Diluted EPS | $0.24 | $0.13 | +84.6% | $0.62 | $0.31 | +100.0% | Interim Condensed Consolidated Statements of Financial Position (Unaudited) Statement of Financial Position Highlights (USD in thousands) | Account | Sep 30, 2024 (Unaudited) | Dec 31, 2023 | | :--- | :--- | :--- | | Total Assets | $188,535 | $154,869 | | Intangible assets | $138,398 | $98,000 | | Cash and cash equivalents | $15,723 | $25,429 | | Total Liabilities | $63,201 | $35,945 | | Borrowings | $24,446 | $0 | | Deferred consideration | $17,451 | $18,811 | | Total Equity | $125,334 | $118,924 | - The significant increase in intangible assets is primarily due to the acquisition of Freebets.com and related assets. The company also took on new borrowings of $24.4 million during the period[14][33] Interim Condensed Consolidated Statements of Changes in Equity (Unaudited) - Total equity increased from $118.9 million at the start of 2024 to $125.3 million as of September 30, 2024. The increase was driven by net income of $22.7 million, partially offset by the acquisition of treasury shares for $22.1 million under the share repurchase program[19] Interim Condensed Consolidated Statements of Cash Flows (Unaudited) Cash Flow Summary - Nine Months Ended Sep 30 (USD in thousands) | Cash Flow Activity | 2024 | 2023 | | :--- | :--- | :--- | | Operating Activities | $23,936 | $10,950 | | Investing Activities | ($33,675) | ($12,483) | | Acquisition of intangible assets | ($21,074) | ($388) | | Payment of deferred consideration | ($10,044) | ($4,933) | | Financing Activities | $630 | ($1,194) | | Proceeds from borrowings | $45,560 | $0 | | Treasury shares acquired | ($22,195) | ($759) | | Net Change in Cash | ($9,109) | ($2,727) | - Cash used in investing activities increased significantly due to the acquisition of intangible assets (Freebets.com). Financing activities show new proceeds from borrowings of $45.6 million, which were largely used for acquisitions and share repurchases of $22.2 million[23] Notes to the Interim Condensed Consolidated Financial Statements (Unaudited) - On April 1, 2024, the company acquired Freebets.com and related assets from XL Media PLC. The acquisition was accounted for as an asset acquisition, not a business combination[33] - The company entered into a new credit agreement with Wells Fargo on March 19, 2024, providing a $25 million term loan and a $25 million revolving credit facility. As of September 30, 2024, the full term loan was drawn[96][97] - During the nine months ended September 30, 2024, the company repurchased 2,480,235 shares for a total of $22.1 million under its authorized share repurchase program[76] - For the nine months ended September 30, 2024, revenue from North America was $39.9 million, UK & Ireland was $28.6 million, and Other Europe was $16.6 million. Casino products generated $66.7 million in revenue, while Sports generated $24.2 million[121][122] Operating and Financial Review and Prospects Management reviews the company's financial condition and results, analyzing revenue, expenses, non-IFRS metrics, and key performance indicators Revenue by Geography - Nine Months Ended Sep 30 (USD in thousands) | Region | 2024 | 2023 | YoY Change | | :--- | :--- | :--- | :--- | | North America | $39,877 | $40,407 | -1% | | UK and Ireland | $28,631 | $23,749 | +21% | | Other Europe | $16,557 | $7,902 | +110% | | Rest of the world | $6,809 | $4,064 | +68% | | Total | $91,874 | $76,122 | +21% | Revenue by Product - Nine Months Ended Sep 30 (USD in thousands) | Product | 2024 | 2023 | YoY Change | | :--- | :--- | :--- | :--- | | Casino | $66,707 | $49,803 | +34% | | Sports | $24,156 | $25,518 | -5% | | Other | $1,011 | $801 | +26% | | Total | $91,874 | $76,122 | +21% | - Revenue growth was driven by the Casino segment and strong performance in European markets, benefiting from both organic growth and the acquisition of Freebets.com. This offset a slight decline in North America and the Sports segment[173][179][187] Non-IFRS Performance Metrics - Nine Months Ended Sep 30 | Metric | 2024 | 2023 | YoY Change | | :--- | :--- | :--- | :--- | | Adjusted EBITDA | $33,955 | $26,146 | +30% | | Adjusted EBITDA Margin | 37% | 34% | +3 p.p. | | Free Cash Flow | $28,417 | $16,694 | +70% | - The company's Key Performance Indicator, New Depositing Customers (NDCs), increased by 25% to 332,000 for the nine months ended September 30, 2024, compared to the same period in 2023, demonstrating business growth primarily in casino products[237] Quantitative and Qualitative Disclosures About Market Risk The company details its exposure to market, interest rate, credit, and liquidity risks, including currency sensitivity and liability maturity - The company is exposed to foreign currency risk as sales and expenses are denominated in EUR, USD, and GBP. A 10% strengthening of the USD against the EUR would increase net income before tax by approximately $1.5 million[263][266] - The company now has exposure to interest rate risk due to its new variable-rate borrowings under the Wells Fargo Credit Facility[266][268] Maturity Profile of Financial Liabilities as of Sep 30, 2024 (USD in thousands) | Liability | Less Than 1 Year | 1-2 Years | More Than 2 Years | Total | | :--- | :--- | :--- | :--- | :--- | | Deferred consideration | $17,800 | $0 | $0 | $17,800 | | Contingent consideration | $2,723 | $0 | $0 | $2,723 | | Borrowings and interest | $4,620 | $5,203 | $19,024 | $28,847 | | Lease liability | $1,246 | $1,278 | $3,912 | $6,436 | | Trade and other payables | $4,016 | $0 | $0 | $4,016 | | Total | $30,405 | $6,481 | $22,936 | $59,822 | Purchases of Equity Securities by the Issuer and Affiliated Purchases Details of the company's share repurchase program are provided, including authorized amounts and Q3 2024 monthly repurchase data - The company's board has authorized a total of $40.0 million for share repurchases since the program began. The authorization is set to expire on May 18, 2027[276] Share Repurchases for Q3 2024 | Period | Number of Shares Repurchased | Average Price Paid ($) | | :--- | :--- | :--- | | July 2024 | 597,412 | $8.82 | | August 2024 | 398,281 | $9.55 | | September 2024 | 321,282 | $10.10 | Signatures Signatures The report was signed on November 14, 2024, by Elias Mark, Chief Financial Officer of Gambling.com Group Limited - The report was duly signed on November 14, 2024, by Elias Mark, the Chief Financial Officer of Gambling.com Group Limited[282]