Bragg Gaming (BRAG)2024-08-08 16:53Financial Data and Key Metrics Changes - Total revenue for Q2 2024 was €24.9 million, a record high, up 0.5% compared to Q2 2023 [10] - Gross profit decreased by 10% to €12.4 million, with a gross profit margin of 49.9% [10] - Adjusted EBITDA for the quarter was down 24% to €3.6 million, with an adjusted EBITDA margin of 14.5% [10] - Revenue, gross profit, and adjusted EBITDA showed sequential growth compared to Q1 2024, with increases of 4.4%, 4.4%, and 6% respectively [11] Business Line Data and Key Metrics Changes - Revenue from content represented 80% of total revenue in Q2 2024, up from 77% in Q2 2023 [11] - Proprietary content and exclusive third-party content revenue increased by 12% since Q2 2023, with notable growth in the U.S. market [11] Market Data and Key Metrics Changes - The company has expanded its distribution coverage in the U.S. to approximately 70% of the total addressable market, projected to reach 90% by the end of the year [31] - The global regulated online casino market is estimated at $32 billion in gross gaming revenue for 2024, projected to nearly double to $63 billion by 2029 [21] Company Strategy and Development Direction - The company is focused on increasing revenues and profitability through scaling its content business and expanding its regulated market distribution [18] - The strategic review process is ongoing, exploring potential mergers, acquisitions, or additional investments [4] - The company aims to leverage its proprietary Fuze player engagement solution to enhance its offerings across various gaming products [19] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about growth opportunities in North America, particularly through proprietary content and managed services [33] - The company is tracking to the lower end of its full-year revenue and adjusted EBITDA guidance, with expectations of robust trading in the second half of the year [31] Other Important Information - The company appointed new executives to strengthen its leadership team, including Robbie Bressler as Interim CFO and Neill Whyte as Chief Commercial Officer [5][16] - The company has settled its remaining convertible debt in cash post-quarter end [12] Q&A Session Summary Question: Where do you expect the bulk of the growth to come from beyond this year? - Management expects growth from expanding distribution in North America and new jurisdictions in Latin America and Europe [33] Question: How does the pipeline look for potential new PAM and content partners? - The pipeline is strong for turnkey solution clients, with a focus on North America for significant growth [34] Question: Is the company still on track to return to growth in gross margin by 2025? - Management believes that increasing the concentration of PAM and managed service customers will lead to improved profit margins [35] Question: What changes does the new CFO plan to implement from a financial perspective? - The new CFO aims to strengthen the balance sheet and explore partnership or M&A opportunities [37] Question: Has the company entered new regulated markets recently? - The company has entered the newly regulated market in Peru and is active in Brazil, with optimism about future opportunities in New Zealand and other jurisdictions [39] Question: What is the expected revenue uptick as U.S. coverage ramps up? - Management anticipates a significant increase in revenue as wagering is expected to double this year [41] Question: How has the Olympics impacted customer activity? - Management does not believe the Olympics have significantly impacted operator results, with previous events like the Euro being more influential [44]