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Q2 Revenue of $35.2 million, up 230.0% (28.0% Organic Growth)
LAS VEGAS, NV, August, 29 2016 – NYX Gaming Group Limited (TSXV:NYX) ("NYX Gaming Group" or "Company") today announced its financial and operating results for the second quarter ended June 30, 2016. All amounts expressed are in Canadian dollars unless otherwise noted.
“We are pleased with the progress that we have delivered in Q2. With the closing of the OpenBet acquisition, we move our focus from acquisitions to integration of our business operations and delivery of operational leverage. We look forward to continuing to strengthen our business model and create reoccurring, sustainable revenue over the long-term across all products for the benefit of our customers and shareholders,” says CEO Matt Davey.
Second Quarter 2016 Highlights
Second Quarter Operating and Financial Results
In the second quarter of 2016, NYX continued to see a strong demand in both our Open Gaming System ("OGS") and our Open Platform System ("OPS"), signing 11 new agreements with Sisal, Pala Interactive, Rush Street Gaming, Starcasino, Solverde, and Luckia. OGS was also successfully launched across 21 new client sites: Mybet, Rush Street Gaming, Sisal, and SNAI. In addition, our NYX content studios released twenty-six new games during the three months ended June 30, 2016.
On May 20, 2016, NYX and privately held OB Topco Limited ("OpenBet"), closed the share purchase agreement in which NYX acquired 100% of the issued and outstanding shares of OpenBet for a total consideration of £270.0 ($491.0) million. The acquisition was financed as described below:
On May 27, 2016, NYX acquired Betdigital, a UK based supplier of gaming content and platforms. This acquisition has provided NYX with a game development platform and studio that caters to the UK retail and online markets. The maximum aggregate consideration payable is £24.5 million. The purchase price consists of an upfront cash payment of £3.5 million, as well as an earn-out to be paid over three years on achieving certain operating profit hurdles each year, which may be made in cash or shares at the Company’s option.
For further detailed information regarding the announcements of Open Bet and Betdigital, please see company’s press releases posted on www.sedar.com.
Summary of Results
Three Months Ended
Six Months Ended
|In 000’s except share data||Jun 30, 2016||Jun 30, 2015||% Change||Jun 30, 2016||Jun 30, 2015||% Change|
|Gross Margin %||87.3%||85.0%||85.7%||86.5%|
|Net Income (Loss)||($29,030)||$13,868||NM||($38,167)||$8,835||NM|
|Basic Income (Loss) Per Share||($0.56)||$0.41||NM||($0.74)||$0.26||NM|
|Diluted Income (Loss) Per Share||($0.56)||$0.31||NM||($0.74)||$0.20||NM|
Revenue for the three months ended June 30, 2016 grew to $35.2 million, or 230.0%%, from $10.7 million for the three months ended June 30, 2015. Royalty and License revenue was the main driver of growth as we benefited from a full quarter of contribution from the prior year's acquisitions and approximately six weeks of OpenBet. The Company launched 18 new customers in the quarter which contributed to an increase in revenue of $12.0 million for the three months ended June 30, 2016. Excluding acquisitions, organic revenue for the three months ended June 30, 2016 grew to $13.7 million, or 28.0%, from $10.7 million for the three months ended June 30, 2015.
Gross profit grew by $21.7 million for the three months ended June 30, 2016 to $30.8 million compared to the three months ended June 30, 2015. The gross profit percentage was 87.3% for the three months ended June 30, 2016 compared to 85.0% for the three months ended June 30, 2015. The increase in gross profit was a result of the increase in revenue from the underlying core casino business and the impact from acquisitions.
Net Loss and Loss per Share
Net income tax benefit was $1.3 million for the three months ended June 30, 2016 compared to a benefit of $0.1 million for the three months ended June 30, 2015. The increase in income tax benefit was due to the impairment of $6.5 million of acquired intangibles from the EGC acquisition.
Adjusted EBITDA was $10.5 million for the three months ended June 30, 2016. The increase in EBITDA was driven by operating efficiencies achieved from previous acquisitions, contributions from OpenBet, and strong growth in our core casino products. Adjusted EBITDA margins were 29.9% compared to 23.8% for the three months ended June 30, 2015.
Financial Position as of June 30, 2016
Second Quarter Conference Call
To access managements presentation please click or paste the following link:
A conference call to discuss NYX's second quarter results will be held today, at 8:30am ET. To participate interested parties are asked to click the above link or are asked to dial (647) 427-7450 or 1-888-231-8191 prior to the scheduled start of the call. A replay of the conference call will be available by dialing (855) 859 - 2056 and using the reference number 65437544. This call will be available until September, 05 2016.
Financial Statements and Management's Discussion and Analysis
NYX Gaming Group's unaudited consolidated financial statements, notes thereto and Management's Discussion and Analysis for the three-month period ended June 30, 2016 will be available on SEDAR at www.sedar.com. Additional information relating to NYX Gaming Group and its business may also be found on SEDAR at www.sedar.com and the Company's website at www.nyxgaminggroup.com.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is definite in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Caution Regarding Forward-Looking Statements and Non-IFRS Financial Measures
Certain statements included herein, including those that express management’s expectations or estimates of our future performance, constitute “forward-looking statements” within the meaning of applicable securities laws. Any statements that are contained in this news release that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements are often identified by terms such as “may”, “will”, “should”, “expect”, “plan”, “anticipate”, “believe”, “intend”, “estimate”, “potential” or the negative of these terms or other similar expressions. Forward-looking statements are based on certain assumptions regarding the Company’s expected growth, results of operations, performance, industry trends and growth opportunities. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by management at this time, are inherently subject to significant business, economic and competitive risks, uncertainties and contingencies that could cause actual results to differ materially from those expressed or implied in such statements. Investors are cautioned not to put undue reliance on forward-looking statements. Applicable risks and uncertainties include, but are not limited to: credit, market, currency, operational, liquidity and funding risks, including changes in economic conditions, interest rates or tax rates, the impact of government regulation on the on-line gaming industry and the risk that such regulation is subject to change, competition from other providers of online gaming services, the possibility that the Company be unable to successfully integrate the B2B Business as described herein, the risks associated with international and foreign operations, the impact of consolidations in the online gaming industry and the other risks identified under the heading “Risk Factors” in the Company’s final long form prospectus dated December 18, 2014, as filed on SEDAR at www.sedar.com, and in other filings that NYX Gaming Group may make with applicable securities authorities in the future. The forward-looking statements contained herein reflect NYX Gaming Group’s current views with respect to future events, and except as required by law, NYX Gaming Group does not intend, and undertakes no obligation, to update any forward-looking statements to reflect, in particular, new information or future events, or otherwise.
This release contains Non-IFRS financial measures and are noted where used. These financial measures are used by many investors to compare companies and management believes they are important measures in evaluating NYX Gaming Group. However, they are not recognized measures under IFRS and do not have a standardized meaning prescribed by IFRS. Therefore, they may not be comparable to similar measures presented by other issuers. Investors are cautioned that such measures should not be construed as alternatives to comparable IFRS measures determined in accordance with IFRS.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
NYX Gaming Group Limited is listed on the TSX Venture Exchange under the symbol (NYX.V).
For further information:
Matt Davey, Chief Executive Officer, NYX Gaming Group Limited, 1-702-586-8428; Joann Head, Investor Relations, 1-647-962-9600
Event ID: 1255826
Event Title: Q2 Earnings Announcement
Event Date: August 29, 2016 at 08:30 AM Eastern Daylight Time
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Conference ID # 65437544
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Leader Toll Free Dial-In Number: (888) 231-8192
Leader International Dial-In Number: (647) 427-7451
Participant Toll Free Dial-In Number: (888) 231-8191
Participant International Dial-In Number: (647) 427-7450
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About NYX Gaming Group Limited
NYX Gaming Group Limited is a premier digital gaming supplier headquartered in Las Vegas, USA with a staff of approximately 1,000 employees based in 11 countries across Europe, North America and Australia. The Company provides one of the world’s largest portfolios of leading content and technology to some of the foremost gaming operators, lotteries and casinos across the globe. NYX also has one of the broadest distribution bases in the industry with over 170 unique customers and a collective game catalogue of over 700 games. The market leading game catalogue includes slots, table games, scratch cards, lottery, bingo and poker available across web and mobile formats.