Gambling.com (GAMB) - 2024 Q4 - Annual Report

Executive Summary Gambling.com Group achieved record Q4 and full-year 2024 results, driven by iGaming focus, with strong 2025 guidance and strategic acquisitions Press Release Headline Gambling.com Group reported record fourth quarter and full-year 2024 results, driven by a focus on iGaming, and provided 2025 guidance implying significant year-over-year growth - Gambling.com Group reported record Q4 and full-year 2024 results, driven by iGaming prioritization[1][2] - 2025 guidance mid-points imply 35% YoY revenue growth and 40% YoY Adjusted EBITDA growth[1] Executive Commentary CEO Charles Gillespie highlighted record Q4 and full-year performance, attributing success to iGaming focus and anticipating continued market share gains in 2025, including North America, bolstered by the Odds Holdings acquisition - CEO Charles Gillespie emphasized record Q4 and full-year results, driven by iGaming prioritization and strong performance, anticipating continued market share gains in 2025 across all regions, including North America. The consolidation of Odds Holdings, Inc. is expected to layer sports data solutions onto the existing high-growth, high-margin business[2] - CFO Elias Mark highlighted Q4 revenue and Adjusted EBITDA increases of 9% and 39% year-over-year, respectively, with over 80% Adjusted EBITDA converting to free cash flow. He noted strong online casino growth globally and resilient North American business, expecting significant revenue and Adjusted EBITDA growth in 2025[2] Financial Performance Highlights The company achieved record Q4 and full-year 2024 financial results, with significant growth in revenue, Adjusted EBITDA, net income, and free cash flow Fourth Quarter 2024 Financial Highlights In Q4 2024, Gambling.com Group achieved record revenue of $35.3 million, a 9% increase year-over-year, despite a 9% decrease in New Depositing Customers (NDCs) due to challenging prior-year comparisons Q4 2024 Financial Metrics | Metric | Q4 2024 (USD in thousands) | Q4 2023 (USD in thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 35,308 | 32,530 | 9 % | | Net income attributable to shareholders | 7,933 | 6,372 | 24 % | | Net income per share (diluted) | 0.23 | 0.16 | 44 % | | Adjusted net income attributable to shareholders | 12,172 | 8,622 | 41 % | | Adjusted net income per share (diluted) | 0.35 | 0.22 | 59 % | | Adjusted EBITDA | 14,736 | 10,569 | 39 % | | Adjusted EBITDA Margin | 42 % | 32 % | - | | Cash flows from operating activities | 13,698 | 7,140 | 92 % | | Free Cash Flow | 13,162 | 6,511 | 102 % | - Revenue rose 9% year-over-year to a record $35.3 million, despite a 9% decrease in New Depositing Customers (NDCs) to 145,000, primarily due to a challenging comparison with ESPNBet's launch in Q4 2023[4] - Gross profit increased 21% to $33.1 million, driven by strong revenue growth and a $2.9 million decrease in cost of sales from media partnerships[5] Full Year 2024 Financial Highlights For the full year 2024, Gambling.com Group achieved a 17% increase in revenue to $127.2 million, with significant growth across key profitability and cash flow metrics FY 2024 Financial Metrics | Metric | FY 2024 (USD in thousands) | FY 2023 (USD in thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 127,182 | 108,652 | 17 % | | Net income attributable to shareholders | 30,679 | 18,260 | 68 % | | Net income per share (diluted) | 0.84 | 0.47 | 79 % | | Adjusted net income attributable to shareholders | 42,120 | 32,207 | 31 % | | Adjusted net income per share (diluted) | 1.16 | 0.84 | 38 % | | Adjusted EBITDA | 48,691 | 36,715 | 33 % | | Adjusted EBITDA Margin | 38 % | 34 % | - | | Cash flows from operating activities | 37,638 | 17,910 | 110 % | | Free Cash Flow | 41,582 | 23,000 | 81 % | - Full-year revenue, Adjusted EBITDA, and Free Cash Flow grew 17%, 33%, and 81%, respectively, year-over-year[2] Business and Operational Highlights In Q4 2024, Gambling.com Group delivered over 145,000 new depositing customers (NDCs) and repurchased 486,312 shares, while also winning 'Casino Affiliate of the Year' and completing the accretive acquisition of Odds Holdings, Inc - Delivered over 145,000 new depositing customers (NDCs)[8] - Repurchased 486,312 shares at an average price of $9.80 per share[8] - Won 'Casino Affiliate of the Year' at the 2024 EGR Operator Awards[8] - Completed accretive acquisition of Odds Holdings, Inc. on January 1, 2025, for initial consideration of $70 million in cash and $10 million in shares[8] - Expanded credit facility to $165 million with a new syndicate[8] 2025 Financial Outlook The company reiterated its 2025 full-year guidance, projecting significant revenue and Adjusted EBITDA growth, incorporating the Odds Holdings acquisition and specific market assumptions Guidance Gambling.com Group reiterated its 2025 full-year guidance, projecting revenue between $170 million and $174 million and Adjusted EBITDA between $67 million and $69 million, with an anticipated Adjusted EBITDA margin of 39.5% 2025 Financial Guidance | Metric | 2025 Guidance Range (USD in millions) | Midpoint (USD in millions) | YoY Growth (Midpoint) | | :--- | :--- | :--- | :--- | | Revenue | $170 - $174 | $172 | 35 % | | Adjusted EBITDA | $67 - $69 | $68 | 40 % | | Adjusted EBITDA Margin | - | 39.5 % | - | Guidance Assumptions The 2025 guidance incorporates approximately $14.5 million in incremental Adjusted EBITDA from the Odds Holdings, Inc. acquisition, assumes no new North American markets will come online, and an average EUR/USD exchange rate of 1.07 - Assumes incremental Adjusted EBITDA contributions of approximately $14.5 million from the Odds Holdings, Inc. acquisition (completed January 1, 2025)[12] - Assumes no additional North American markets coming online over the balance of 2025, with benefits from new state launches excluded until a definitive start date is announced[12] - Assumes an average EUR/USD exchange rate of 1.07 throughout 2025[12] Corporate Information This section provides conference call details, investor and media contacts, and an overview of Gambling.com Group's global digital marketing services Conference Call Details A conference call to discuss the results was scheduled for Thursday, March 20, 2025, at 8:00 a.m. ET, with webcast and dial-in access provided Conference Call Information | Detail | Information | | :--- | :--- | | Date/Time | Thursday, March 20, 2025, at 8:00 a.m. ET | | Webcast | https://www.webcast-eqs.com/register/Gamb032025/en | | U.S. Toll-Free Dial In | 877-407-0890 | | International Dial In | 1 201-389-0918 | Investor and Media Contacts Contact information for investor relations (Peter McGough, Richard Land, Norberto Aja at JCIR) and media inquiries (Eddie Motl) was provided for further information - Investors can contact Peter McGough at Gambling.com Group or Richard Land/Norberto Aja at JCIR[13] - Media inquiries can be directed to Eddie Motl at Gambling.com Group[13] About Gambling.com Group Gambling.com Group Limited is a rapidly growing provider of digital marketing services for the global online gambling industry, operating over 50 branded websites across 19 national markets - Gambling.com Group Limited (Nasdaq: GAMB) is a fast-growing provider of digital marketing services for the global online gambling industry, founded in 2006[13] - The Group operates over 50 websites in more than 10 languages across 19 national markets, covering iGaming, sports betting, and fantasy sports, including premier brands like Gambling.com, Bookies.com, Casinos.com, and RotoWire.com[13] - The OddsJam platform provides a suite of tools and services for consumers and enterprises in sports betting[13] Legal and Disclosure This section introduces non-IFRS financial measures and provides a cautionary note regarding forward-looking statements and associated risks Use of Non-IFRS Measures Introduction This press release includes non-IFRS financial measures such as Adjusted Net Income, EBITDA, Adjusted EBITDA, Adjusted EBITDA Margin, and Free Cash Flow, with reconciliations to comparable IFRS numbers provided - The press release contains non-IFRS financial measures including Adjusted Net Income, EBITDA, Adjusted EBITDA, Adjusted EBITDA Margin, and Free Cash Flow[14] - Reconciliations to comparable IFRS numbers are provided in the 'Supplemental Information - Non-IFRS Financial Measures' section[14] Cautionary Note Concerning Forward-Looking Statements The press release contains forward-looking statements regarding future events, financial condition, and business strategies, which are subject to known and unknown risks and uncertainties that could cause actual results to differ materially - The press release includes forward-looking statements about future events, financial condition, and business strategy, identifiable by terms such as 'believe,' 'may,' 'estimate,' 'continue,' 'anticipate,' 'intend,' 'should,' 'plan,' 'expect,' 'predict,' 'potential,' 'could,' 'will,' 'would,' 'ongoing,' 'future' or their negatives[15] - These statements are based on current expectations and projections but are subject to known and unknown risks, uncertainties, and other important factors that may cause actual results to differ materially[15] - Gambling.com Group disclaims any obligation to update or revise forward-looking statements, except as required by applicable law, and advises against undue reliance[15] Unaudited Consolidated Financial Statements This section presents the unaudited consolidated statements of comprehensive income, financial position, and cash flows for Q4 and full-year 2024 Consolidated Statements of Comprehensive Income The consolidated statements of comprehensive income show a 9% increase in Q4 2024 revenue to $35.3 million and a 17% increase for the full year to $127.2 million, with significant growth in gross and operating profit Consolidated Statements of Comprehensive Income (USD in thousands) | Metric | Q4 2024 | Q4 2023 | Q4 Change (%) | FY 2024 | FY 2023 | FY Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Revenue | 35,308 | 32,530 | 9 % | 127,182 | 108,652 | 17 % | | Cost of sales | (2,185) | (5,089) | (57)% | (7,536) | (9,112) | (17)% | | Gross profit | 33,123 | 27,441 | 21 % | 119,646 | 99,540 | 20 % | | Operating profit | 9,859 | 8,170 | 21 % | 35,675 | 21,778 | 64 % | | Income before tax | 9,006 | 6,213 | 45 % | 34,150 | 20,141 | 70 % | | Net income attributable to shareholders | 7,933 | 6,372 | 25 % | 30,679 | 18,260 | 68 % | | Total comprehensive income attributable to shareholders | 534 | 11,325 | (95)% | 24,074 | 21,128 | 14 % | Consolidated Statements of Financial Position As of December 31, 2024, total assets increased to $178.6 million, driven by a rise in intangible assets, while total equity also increased to $123.2 million, and non-current liabilities significantly rose due to new borrowings Consolidated Statements of Financial Position (USD in thousands) | Metric | Dec 31, 2024 (USD in thousands) | Dec 31, 2023 (USD in thousands) | | :--- | :--- | :--- | | ASSETS | | | | Total non-current assets | 143,694 | 107,502 | | Total current assets | 34,889 | 47,367 | | Total assets | 178,583 | 154,869 | | EQUITY AND LIABILITIES | | | | Total equity | 123,188 | 118,924 | | Total non-current liabilities | 25,659 | 3,198 | | Total current liabilities | 29,736 | 32,747 | | Total liabilities | 55,395 | 35,945 | | Total equity and liabilities | 178,583 | 154,869 | - Intangible assets increased from $98.0 million in 2023 to $130.8 million in 2024[19] - Borrowings increased significantly from $0 in 2023 to $19.6 million in non-current liabilities and $3.3 million in current liabilities in 2024[19] Consolidated Statements of Cash Flows Cash flows generated by operating activities significantly increased in Q4 and for the full year 2024, while cash flows used in investing and financing activities also rose, reflecting acquisitions and treasury share repurchases Consolidated Statements of Cash Flows (USD in thousands) | Metric | Q4 2024 | Q4 2023 | FY 2024 | FY 2023 | | :--- | :--- | :--- | :--- | :--- | | Cash flow from operating activities | 13,698 | 7,140 | 37,638 | 17,910 | | Cash flows used in investing activities | (10,055) | (6,991) | (43,842) | (19,474) | | Cash flows used in financing activities | (5,486) | (1,949) | (5,244) | (3,143) | | Net movement in cash and cash equivalents | (1,843) | (1,800) | (11,448) | (4,707) | | Cash and cash equivalents at end of period | 13,729 | 25,429 | 13,729 | 25,429 | - Acquisition of intangible assets was a significant use of cash in investing activities, totaling $21.1 million for the full year 2024[21] - Treasury shares acquired amounted to $27.1 million for the full year 2024, contributing to cash used in financing activities[21] Supplemental Financial Data This section provides supplemental financial data including earnings per share, disaggregated revenue, and reconciliations for non-IFRS financial measures Earnings Per Share Diluted net income per share attributable to shareholders increased 44% to $0.23 in Q4 2024 and 79% to $0.84 for the full year 2024, partly due to a decrease in weighted-average shares outstanding Earnings Per Share (USD in thousands, except per share data) | Metric | Q4 2024 | Q4 2023 | Q4 Change (%) | FY 2024 | FY 2023 | FY Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Net income attributable to shareholders | 7,933 | 6,372 | 24 % | 30,679 | 18,260 | 68 % | | Weighted-average ordinary shares, diluted | 35,188,864 | 38,879,038 | (9)% | 36,337,349 | 38,542,166 | (6)% | | Net income per share, diluted | 0.23 | 0.16 | 44 % | 0.84 | 0.47 | 79 % | Disaggregated Revenue Revenue disaggregation reveals varied performance across markets, monetization types, and product types, with strong growth in Casino product revenue and international markets offsetting declines in North America and Sports revenue By Market In Q4 2024, North America revenue decreased by 24% year-over-year, while UK and Ireland revenue grew 41%, and Other Europe revenue surged 106% Revenue by Market (USD in thousands) | Market | Q4 2024 | Q4 2023 | Q4 Change (%) | FY 2024 | FY 2023 | FY Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | North America | 15,632 | 20,516 | (24)% | 55,500 | 60,755 | (9)% | | UK and Ireland | 10,555 | 7,495 | 41 % | 39,179 | 31,347 | 25 % | | Other Europe | 6,366 | 3,086 | 106 % | 22,463 | 10,994 | 104 % | | Rest of the world | 2,755 | 1,433 | 92 % | 10,040 | 5,556 | 81 % | | Total revenues | 35,308 | 32,530 | 9 % | 127,182 | 108,652 | 17 % | By Monetization Type Performance marketing revenue increased 5% in Q4 2024 and 15% for the full year, while advertising & other revenue showed strong growth, up 34% in Q4 and 35% for the full year Revenue by Monetization Type (USD in thousands) | Monetization Type | Q4 2024 | Q4 2023 | Q4 Change (%) | FY 2024 | FY 2023 | FY Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Performance marketing | 28,404 | 27,000 | 5 % | 101,078 | 87,824 | 15 % | | Subscription | 2,191 | 2,009 | 9 % | 8,367 | 7,652 | 9 % | | Advertising & other | 4,713 | 3,521 | 34 % | 17,737 | 13,176 | 35 % | | Total revenues | 35,308 | 32,530 | 9 % | 127,182 | 108,652 | 17 % | By Product Type Casino product revenue significantly increased by 49% in Q4 2024 and 38% for the full year, offsetting a decline in Sports product revenue, which decreased by 39% in Q4 and 18% for the full year Revenue by Product Type (USD in thousands) | Product Type | Q4 2024 | Q4 2023 | Q4 Change (%) | FY 2024 | FY 2023 | FY Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Casino | 25,505 | 17,081 | 49 % | 92,224 | 66,869 | 38 % | | Sports | 9,135 | 14,933 | (39)% | 33,282 | 40,634 | (18)% | | Other | 668 | 516 | 29 % | 1,676 | 1,149 | 46 % | | Total revenues | 35,308 | 32,530 | 9 % | 127,182 | 108,652 | 17 % | Non-IFRS Financial Measures and Reconciliations This section details the definitions, rationale, and reconciliations for various non-IFRS financial measures used by management to assess business performance - Management uses both IFRS and non-IFRS financial measures to analyze business performance and make operational decisions[26] - Non-IFRS measures are not substitutes for, or superior to, IFRS results and may not be comparable to similarly titled measures used by other companies[30][31][38][44] Rounding Policy Rounding adjustments have been applied to some figures in the financial discussion and statements, meaning numerical totals in tables may not be exact arithmetic aggregations of their preceding figures - Rounding adjustments have been made, so numerical figures shown as totals in some tables may not be an arithmetic aggregation of the figures that preceded them[25] Adjusted Net Income and Adjusted Net Income Per Share The definition of Adjusted Net Income was changed in Q4 2024 to exclude non-recurring and significant non-cash items, aiming to better reflect underlying business performance, with Adjusted net income per diluted share calculated accordingly - In Q4 2024, the definition of Adjusted Net Income was changed to exclude non-recurring items, significant non-cash items, share-based payment expense, fair value movements related to contingent consideration, unwinding of deferred consideration, amortization expenses related to acquired businesses and assets, and other acquisition-related expenses[27] - Adjusted net income per diluted share is defined as adjusted net income attributable to equity holders divided by the diluted weighted average number of common shares outstanding[28] - These measures are considered useful for comparative performance by removing effects of non-recurring items, significant non-cash items, fair value movements, and acquisition-related expenses[29] Reconciliation of Adjusted Net Income and Adjusted Net Income Per Share (USD in thousands, except per share data) | Metric | Q4 2024 | Q4 2023 | FY 2024 | FY 2023 | | :--- | :--- | :--- | :--- | :--- | | Net income attributable to shareholders | 7,933 | 6,372 | 30,679 | 18,260 | | Share-based payment and related expense | 1,215 | 997 | 4,953 | 3,787 | | Fair value movement on contingent consideration | — | — | — | 6,939 | | Unwinding of deferred consideration | 213 | 309 | 1,289 | 735 | | Acquisition related costs | 1,907 | 508 | 2,151 | 821 | | Amortization expense related to acquired businesses and assets | 998 | 133 | 3,246 | 461 | | Tax effect of the adjusting costs | (94) | (23) | (308) | (98) | | Adjusted net income attributable to shareholders | 12,172 | 8,622 | 42,120 | 32,207 | | Net income per share, diluted | 0.23 | 0.16 | 0.84 | 0.47 | | Adjusted net income per share, diluted | 0.35 | 0.22 | 1.16 | 0.84 | EBITDA, Adjusted EBITDA and Adjusted EBITDA Margin EBITDA is defined as earnings excluding interest, income tax, depreciation, and amortization, with Adjusted EBITDA further excluding non-recurring and significant non-cash items, and Adjusted EBITDA Margin representing Adjusted EBITDA as a percentage of revenue - EBITDA is defined as earnings excluding interest, income tax, depreciation, and amortization[36] - Adjusted EBITDA excludes non-recurring items, significant non-cash items, share-based payment expense, foreign exchange gains/losses, fair value of contingent consideration, and acquisition-related expenses[36] - Adjusted EBITDA Margin is Adjusted EBITDA as a percentage of revenue[36] Reconciliation of EBITDA and Adjusted EBITDA (USD in thousands) | Metric | Q4 2024 | Q4 2023 | FY 2024 | FY 2023 | | :--- | :--- | :--- | :--- | :--- | | Net income attributable to shareholders | 7,933 | 6,372 | 30,679 | 18,260 | | Add back: Interest expenses, Income tax, Depreciation, Amortization | 3,309 | 2,866 | 10,349 | 4,130 | | EBITDA | 11,323 | 6,729 | 41,324 | 22,135 | | Share-based payment and related expense | 1,215 | 997 | 4,953 | 3,787 | | Unwinding of deferred consideration | 213 | 309 | 1,289 | 735 | | Acquisition related costs | 1,907 | 508 | 2,151 | 821 | | Adjusted EBITDA | 14,736 | 10,569 | 48,691 | 36,715 | | Revenue | 35,308 | 32,530 | 127,182 | 108,652 | | Adjusted EBITDA Margin | 42 % | 32 % | 38 % | 34 % | Free Cash Flow Free Cash Flow is a non-IFRS liquidity measure defined as cash flow from operating activities less capital expenditures, with its definition updated in Q2 2024 to exclude cash flows related to asset acquisitions, aiming to better reflect cash available for internal development and maintenance - Free Cash Flow is defined as cash flow from operating activities less capital expenditures[42] - In Q2 2024, the definition was changed to exclude cash flows related to asset acquisitions (in addition to business combinations) from capital expenditures, to better reflect cash for internal development and maintenance[42] - Free Cash Flow measures the ability to generate additional cash from operations but does not represent residual cash flows available for all discretionary expenditures[43][44] Reconciliation of Free Cash Flow (USD in thousands) | Metric | Q4 2024 | Q4 2023 | FY 2024 | FY 2023 | | :--- | :--- | :--- | :--- | :--- | | Cash flows generated by operating activities | 13,698 | 7,140 | 37,638 | 17,910 | | Payment of deferred consideration | — | — | 7,156 | 2,897 | | Acquisition of property and equipment | (137) | (157) | (1,326) | (451) | | Capitalization of internally developed intangibles | (399) | (472) | (1,886) | (1,977) | | Free Cash Flow | 13,162 | 6,511 | 41,582 | 23,000 |