GiG sees revenue decline 26.2% in fourth quarter
Gaming Innovation Group (GiG) has reported a year-on-year drop in revenue for the fourth quarter of 2019, as the gaming solutions provider was hit by declines across both its B2B and B2C segments.
Revenue for the three months through to 31 December 2019 came in at €29.4m (£24.5m/$31.8m), down from €39.9m posted in the corresponding period in the previous year.
B2C was GiG’s main source of income during the quarter, but revenue from this division fell 26.4% year-on-year to €19.0m.
Meanwhile, B2B revenue was also down 26.2% to €12.1m, while revenue from GiG’s B2B media services arm slipped 13.8% to €7.5m for the quarter.
GiG is yet to publish its full report for the quarter, but it did reveal that it was able to cut other operating expenses by 11.0% to €13.7m in Q4, primarily due to it decreasing its employee headcount from 706 to 648.
In addition, GiG said earnings before interest, tax, depreciation and amortisation (EBITDA) for the quarter stood at €4.8m, down 4.0% from €5.0m in Q4 of 2018.
Key highlights in the quarter for GiG included the launch of a mobile sportsbook in Iowa with Hard Rock International, as well as securing a deal with William Hill is to launch the Mr Green brand in the Latvian igaming market.
In addition, GiG entered into a new games licensing agreement with B2B casino games provider Swintt, and announced plans to launch GiG Data, a new next-generation data platform designed to integrate with its GiG Core igaming platform and third party solutions.
Richard Brown, who took over as permanent chief executive of GiG in November last year, said that despite the revenue decline, the business is in a good position to pursue growth opportunities in 2020.
“The dynamics in the online gambling industry, both competitive and regulatory, have changed dramatically in the last two years and we as a company are forcefully adapting to that,” Brown said.
“We are coming out of a strategic review initiated in November last year, I am certain the actions taken will place the company in a truly exciting position for growth while securing the sustainability of the company’s financial position by significantly reducing its debt and leverage.”
Publication of the financial figures comes after GiG last week announced that it was to sell off its B2C assets to Betsson in a deal worth €31.0m.
The agreement will see Betsson take ownership of GiG's Zecure subsidiary, to which all assets business activities, operations, front-end and middleware technology and gaming licenses required to run the sites will be transferred.
The sale forms part of GiG’s strategic review, which was initiated in November 2019 in an effort to reduce complexity and improve efficiency. By divesting the B2C vertical, GiG said this will free up resources and as a result allow it to focus on securing stable and sustainable earnings and profit margins for its B2B arm.