Stride reveals losses, details new investment

22 November 2017

Stride Gaming has reported a sharp increase in losses for the year ended August 31, and also confirmed the acquisition of a 51% stake in Passion Gaming.

Net gaming revenue in the full year amounted to £89.9m (€101/4m/$118.9m), up 18% on the £76.4m generated in the previous year, on a pro-forma basis.

Adjusted earnings before interest, tax, depreciation and amortisation increased 24% year-on-year to £20.3m, while adjusted earnings climbed 29% to £18.5m.

However, Stride Gaming did record a loss of £26.7m, compared to profit before tax of £194,000 last year, with basic loss per share coming in at 38.1 pence.

Adjusted basic earnings per share stood at 27.5 pence, 29% more than last year, while Stride Gaming has proposed a higher final dividend per share of 1.5 pence.

Eitan Boyd, chief executive of Stride Gaming, said: “2017 has been a year of significant progress for Stride Gaming during which the group has delivered outstanding growth in its core real-money gaming business.

"This has been driven by our scale and proprietary platform, as well as the highly successful acquisitions of 8Ball, Netboost Media and the Tarco Assets in August 2016.

“The online gaming industry remains fast-growing and dynamic; as an operator with scale, proprietary technology and operational momentum we are confident of delivering further success in the year ahead and continued progress against our growth strategy.”

Meanwhile, Stride Gaming has acquired a majority 51% stake in Passion Gaming Private for a cash consideration of $3.75m.

Stride Gaming said that the deal fits in with its long-term strategy of expanding its presence into new growth markets and attractive, related online gaming product verticals, with the cash consideration to be invested into the company’s working capital to accelerate growth.

The acquisition agreement also includes the option to purchase the remaining 49% stake from the existing shareholders over a three- to five-year period, using a combination of cash and shares based on the future financial performance of Passion Gaming.

Established in 2015, Passion Gaming is the company behind RummyPassion.com and is focused on the Indian skills gaming market.

“We have been monitoring the Indian market for some time as we see strong dynamics in the current environment as well as long-term growth potential,” Boyd said.

“Our UK market experience and proprietary technology advantage, combined with Passion Gaming’s market positioning and operational focus creates a highly attractive proposition. It has been a pleasure to get to know Bobby and his team and we are excited about our shared future growth prospects.”

Bobby Garg, co-founder and chief executive of Passion Gaming, added: “We are delighted to partner with Stride Gaming who are widely recognised as a leading operator and platform provider to the online gaming industry, with an enviable growth track record.

“Our vision is to provide exhilarating, safe and secure skill gaming to players in India; working with Stride Gaming places us in a strong position to bring international standards to rapidly growing Indian gaming market as we continue to focus on player acquisition, engagement and loyalty.”

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