GAN 2018 Results To Beat Market Expectations
GAN today provides a trading update ahead of its preliminary results for the year ended December 31, 2018 (FY 2018) and guidance for 2019.
Trading for FY 2018 is expected to be ahead of market expectations with revenue between £10.5M to £11.3M versus £9.1M for FY 2017. This result was primarily driven by real money Internet gambling which increased H2 2018 revenue by more than 40% over H1 2018. High quality recurring revenues represented approximately 85% of total revenue for the period, with almost two thirds originating from the US, the Companys key geographic market.
GAN ended the period with a strong debt-free balance sheet with £5.3M in cash as at December 31, 2018. EBITDA1 losses for the year are expected to be between £1.0M and £1.5M, due to continued investment in technical development resources throughout H2 2018 to enable the successful launch of the new Internet gambling services for clients in West Virginia, Pennsylvania, and New Jersey in H1 2019.
The outlook remains highly positive due to continued and rapid growth in real money Internet gambling delivered for clients in both the US and European markets. The Company therefore expects the strong momentum achieved during H2 2018 to continue into FY 2019. As such, management expects mid to high double digit percentage year on year revenue growth in FY 2019 and full year positive EBITDA1, based on the current fixed cost base.
The Board does not anticipate any additional capital requirement on the current business plan and the Company is therefore fully funded as it enters FY2019.
Dermot Smurfit, CEO of GAN commented:“We are delighted with our performance in 2018, which sets us up for strong growth in our business in 2019. Our intellectual property and technical expertise put us at the forefront of the internet sports betting and casino gaming market as demonstrated by our strong client base. Our recent contract announcements and expectation for further legislation to pass in new States in the US means that 2019 is set to be a very exciting year.
We exceeded market expectations for revenue growth in 2018, having successfully launched Internet Sports betting in New Jersey. Our successful £7.5 million fund raising has enabled us to rapidly deliver for our clients and repay £2M in short term debt. Going into 2019, we are strategically well placed to deliver profitable growth in 2019.