Bragg Gaming Group, a prominent name in the igaming B2B sector, has announced the formation of a special committee to evaluate its strategic options. The committee, led by independent board member Don Robertson, is set to explore a multitude of strategies that could potentially impact the company’s future. These strategies include but are not limited to the sale of the company or its assets, mergers, financing arrangements, further acquisitions, or other significant strategic changes.
This comprehensive strategic review is part of Bragg’s effort to determine the best path forward. However, the company has clarified that there is no fixed timeline for this strategic review and that no definitive decisions have been made at this point. Bragg further indicated that there can be no assurances given regarding the fruition of any transaction.
The announcement of the strategic committee’s formation coincides with the publication of Bragg’s financial results for the year ending December 31, 2023. The results were encouraging, with revenue reaching €93.5 million, representing a 10.4% increase over the prior year. This growth has been attributed to Bragg’s successful establishment of new partnerships and its entry into new markets.
Throughout the year, Bragg secured content deals with several key operators including Betsson, 888/William Hill, and PokerStars. It also expanded its market reach through partnerships in Mexico with Caliente and in Italy with Microgame. In addition to these new ventures, the company continued to bolster its presence in existing markets by releasing multiple new game titles, with notable growth seen in the US, UK, Spain, and Switzerland.
Crediting the company’s strategic initiatives, CEO Matevž Mazij, who joined Bragg in August, emphasized their focus on being a content-focused igaming B2B provider. Mazij also highlighted their strict control over expenditures. He is confident that the continuous expansion of Bragg’s proprietary and exclusive third-party games to new partners at an accelerated pace positions the company for long-term growth in revenue, gross profit, and adjusted EBITDA.
A closer look at the annual figures shows that the Netherlands continues to be Bragg’s primary market despite a revenue decline of 8.9% from the previous year. The company still maintains a dominant position in the country through its partnerships for player account management (PAM) systems. Nevertheless, Bragg has faced challenges since July 2023 due to increased competition and new regulatory changes.
The Czech Republic remains a growth market for Bragg, which considers it as a part of the ‘Other’ segment in their financial reports. Revenue in this segment saw an increase of 27.3% to €8.4 million. Revenue growth was also observed in other European countries as well as in Bragg’s second core market, Curacao.
CEO Mazij emphasized the rapid global expansion of Bragg’s proprietary and third-party content among tier-one operators and projected a surge in the global adoption of these games in 2024. Furthermore, in alignment with the concerted release strategy, Bragg successfully launched 29 proprietary online titles worldwide in the previous year.
However, the company’s costs have risen in tandem with its expansion. Notably, the cost of revenue and selling, general, and administrative expenses saw significant increases, resulting in an operating loss, although slightly improved from the previous year. After accounting for interest, other finance charges, and taxes, Bragg reported a net loss for the year that was larger than the loss in 2022, with increased costs overshadowing the growth in revenue.
There was some positive news in the form of an increase in adjusted EBITDA, which rose by 25.6% to €15.2 million. Despite this, the final quarter saw a decline in revenue and an operating loss. Nonetheless, adjusted EBITDA and revenue were both higher than in Q3, while operating loss was reduced.
Looking ahead to 2024, Bragg is optimistic, expecting revenue growth between 9.1% and 16.6% and adjusted EBITDA growth between 10.9% and 21.7%. Mazij concluded with confidence in the company’s strategic actions, financial strength, and existing infrastructure to continue the momentum for consistent and profitable growth that will benefit shareholders.
