Gambling.com (US:GAMB)2024-03-21 15:06Financial Data and Key Metrics Changes - Full year revenue rose 42% year-on-year to $108.7 million, with adjusted EBITDA increasing by 53% to $36.7 million, reflecting an adjusted EBITDA margin of 34% [24][71][86] - Free cash flow grew 71% to $16.2 million, with capital expenditures of $9.2 million compared to $9.3 million in 2022 [13][71] - Q4 revenue reached $32.5 million, a 52% increase compared to the prior year, with adjusted net income of $6.8 million or $0.18 per diluted share [22][23] Business Line Data and Key Metrics Changes - North American revenue grew over 30% in 2023, excluding contributions from new state launches, driven by media partnerships and increased consumer account openings [4][22][73] - The company reported record fourth quarter results, with North American revenue exceeding $20 million for the first time [22][81] - New depositing customers in Q4 grew 95% year-on-year to over 159,000, with sports betting making up the highest percentage of quarterly new depositing customers [11] Market Data and Key Metrics Changes - Revenue from the UK and Ireland rose 11% for the full year, with expectations for double-digit growth in 2024 [74] - The company anticipates strong growth in other European markets and has invested in localized products for its brands [74][76] - The acquisition of Freebets.com is expected to drive additional growth in the UK and Ireland, contributing approximately $10 million in revenue [6][90] Company Strategy and Development Direction - The company is focused on leveraging acquisitions to enhance its performance marketing platform, with the recent acquisition of Freebets.com expected to be highly accretive [6][8][75] - Continued investment in consumer-facing products and technology is a priority, with a strong emphasis on capital-efficient growth [72][76] - The company aims to maintain a high-performance culture and is evaluating further acquisition opportunities in both B2B and B2C segments [85] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in continued growth in North America, driven by market share increases and the launch of online sports betting in North Carolina [83][25] - The company expects to achieve revenue guidance for 2024 in the range of $129 million to $133 million, representing a 21% growth over 2023 [14][91] - Management noted that the competitive landscape remains favorable, with no significant changes in overall pricing power across the market [50][62] Other Important Information - The company has a $50 million credit facility with Wells Fargo, providing additional liquidity and financial flexibility [89] - The company repurchased approximately 206,000 ordinary shares at an average price of $9.70 during Q4, totaling around $2 million [88] Q&A Session Summary Question: Importance of authority and traffic in CPA negotiations - Management indicated that authority and traffic are crucial for maintaining competitive advantages in CPA negotiations, especially in light of increased competition [21] Question: Insights on revenue share in North America - Management clarified that while there is potential for revenue share to increase, it is not a significant driver of revenue at present [53][56] Question: Plans for the Brazilian market - Management expressed excitement about Brazil's regulatory developments and indicated a cautious approach to entering the market, focusing on organic growth [41][42] Question: Impact of iGaming legislation - Management noted that the addition of iGaming states would significantly benefit the company, with expectations for growth in states like Georgia and Missouri [58][43] Question: Future revenue mix and media partnerships - Management expects media partnerships to continue contributing to revenue growth, estimating about 15% of revenue in 2024 will come from this segment [62]