GAN(US:GAN)2021-11-11 16:00Financial Performance - GAN Limited reported a net loss of $7.9 million for the three months ended September 30, 2021, compared to a net loss of $2.9 million for the same period in 2020[139]. - Revenue for the three months ended September 30, 2021, decreased by $2.4 million to $32.3 million, a decline of 6.8% compared to the previous quarter[157]. - The net loss for the three months ended September 30, 2021, was $7.9 million, compared to a net loss of $2.7 million in the previous quarter[157]. - Total revenue for the nine months ended September 30, 2021, was $94.7 million, an increase of $68.5 million compared to the same period in 2020[169]. - Adjusted EBITDA for the nine months ended September 30, 2021, was $6.4 million, compared to $3.8 million in the prior year[197]. Revenue Breakdown - Revenue from the United States increased by $492,000 to $9.1 million, representing 28.2% of total revenue, up from 24.9% in the previous quarter[158]. - Revenue from Europe decreased by $2.6 million to $11.6 million, accounting for 36.0% of total revenue, down from 41.0%[158]. - B2B revenue for the nine months ended September 30, 2021, increased by $9.1 million, primarily due to an $8.0 million rise in platform and content fee revenue, reaching $35.3 million[189]. - B2C revenue for the nine months ended September 30, 2021, was $59.4 million, with a gross profit margin of 64.2%[193]. Operational Changes - The acquisition of Coolbet on January 1, 2021, resulted in a change in reportable segments to B2B and B2C, with Coolbet's operations included in the B2C segment[136][138]. - GAN Limited expanded its iGaming solutions into additional U.S. states, launching in Michigan, Tennessee, Colorado, Arizona, and Connecticut, with expectations for further expansion into Louisiana and Maryland[140]. - The company increased its global headcount from 440 to 639 between January 1, 2021, and September 30, 2021, to support its growing U.S. casino operator client base[141]. Awards and Recognition - Coolbet won two awards at the International Gaming Awards in 2021, recognizing its impact in the mobile sports betting industry[138]. - GAN Limited's B2B segment focuses on developing and marketing technology solutions for casino operators, which won three awards from EGR North America in 2021[137]. Costs and Expenses - Operating costs and expenses increased by $2.3 million to $38.6 million, a rise of 6.2% compared to the previous quarter[157]. - General and administrative expenses increased by $18.9 million, primarily due to the inclusion of Coolbet and increased personnel costs[176]. - Depreciation and amortization expense increased by $10.4 million, including $9.2 million related to the acquisition of Coolbet[179]. Cash Flow and Financing - Cash on hand was $50.3 million as of September 30, 2021, primarily funding ongoing working capital needs and software development[211]. - Net cash provided by operating activities increased by $7.2 million due to a decrease in net loss, despite payments of $8.5 million to content providers[220]. - Net cash used in investing activities increased by $101.0 million, primarily due to $92.5 million for the acquisition of Coolbet and increased capitalized software development costs[221]. - Net cash provided by financing activities decreased by $55.2 million, mainly due to the absence of proceeds from the May 2020 IPO[222]. - The company may seek additional equity or debt financing if current resources are insufficient to meet cash requirements[216]. Strategic Initiatives - GAN Limited holds a strategic U.S. patent for linking on-property reward cards to internet gambling accounts, with plans to license this patent to additional U.S. casino operators[142]. - The company anticipates revenue growth from organic growth of existing casino operators and expansion into newly regulated jurisdictions[143]. - The company entered into Content Licensing Agreements totaling $48.5 million for exclusive rights to online gaming content in North America[212]. - Capital expenditures are expected to range from $17.2 million to $20.5 million through December 2022 to support business expansion and acquisitions[214].