In a remarkable financial upswing, Gambling.com Group has made headlines by announcing an impressive annual revenue of $108.7 million for the year ending December 31, 2023. This robust figure represents a staggering 42.1% increase from the previous year’s $76.5 million, highlighting the company’s vigorous growth trajectory.
The robust revenue performance was consistent across 2023, with incremental advancements seen in the first three quarters. The positive momentum didn’t lose steam as the year drew to a close; the final quarter brought record-breaking revenue, amounting to the highest the group has ever seen within a single quarter.
Key strategic movements in 2023 contributed substantially to this growth, most notably the launch of the new Casinos.com domain and a significant partnership with the UK media giant The Independent. However, the crown jewel of Gambling.com Group’s expansion strategy has been its successful foray into the burgeoning North American market.
CEO Charlies Gillespie shed light on the group’s North American endeavors, stating that they have seen exponential growth thanks to new state market entries, heightened ‘same-state’ sales, and flourishing media partnership initiatives. Gillespie asserted that North America has been a substantial factor in the group’s growth and this is expected to continue. He indicated solid expectations of increased North American market share through the ongoing year, bolstered by the recent initiation of online sports betting in their home state of North Carolina.
Revenue, however, wasn’t the only metric displaying positive figures. Higher revenue streams effectively helped balance out increased expenditures in all operational areas. There were significant hikes in cost of sales, which surged by 203.3% to $9.1 million. Sales and marketing expenses rose mildly by 4.8% to $35.3 million, while technology and general administrative expenses also escalated by 51.5% to $10.3 million and 24.6% to $24.3 million, respectively.
Despite these growing operational costs, the group’s pre-tax profits soared to $20.1 million, a dramatic increase from the previous year’s $2.9 million. After-tax affairs have also shown favorable outcomes. Following a tax payment of $1.9 million and taking into account a favorable foreign currency exchange impact of $4.8 million, the net profit for the group stood at $21.1 million, a stark turnaround from a $2.4 million net profit in 2022.
Moreover, the adjusted EBITDA for the year rose by 52.3% to reach $36.7 million, signaling the strong earning potential of the group’s operations. The fourth quarter of 2023 alone boasted an adjusted EBITDA growth of 53.6%, registering at $10.6 million.
Eyeing further prosperity, Gambling.com Group announced a pivotal deal to acquire Freebets.com and related assets. The acquisition, worth between $37.5 million and $42.5 million, involves initial and deferred payments tied to the acquired business’s revenue performance in 2024. The group plans to finance this acquisition through existing cash reserves, its new credit facility, and future cash flows, expecting the transaction to close promptly.
Gillespie envisions this acquisition as a substantial value addition to the group’s existing website portfolio and anticipates that it will generate revenue of about $10.0 million and an incremental adjusted EBITDA of around $5.0 million in the first nine months post-acquisition.
Looking ahead, the group has released a positive financial forecast for 2024, projecting total revenues between $129.0 million and $133.0 million and an adjusted EBITDA range of $44.0 million to $48.0 million. These projections represent significant increases from 2023 and are based on current market conditions, excluding potential benefits from the opening of new US markets or further acquisitions beyond Freebets.com.
Gambling.com Group appears confidently poised for sustained growth in revenue, adjusted EBITDA, and free cash flow in 2024 and the years beyond, across all its markets. Gillespie underscored the alignment of interests between the company’s senior management and all shareholders, reiterating a steadfast commitment to enhancing shareholder value and underlining a future rich with opportunities for the group.
