Prague Gaming Group Reports Third-Quarter Financial Deficit

The Prague Gaming Group reported a financial deficit in the third quarter, but still managed to uphold its annual earnings and adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) goals.

The organization’s income increased by 8.0% year-on-year to €22.6 million (£19.7 million/$24.2 million) in the third quarter. Prague attributed the expansion to a shift toward higher-margin goods, such as internal proprietary content.

In addition to revenue growth, there were other noteworthy events in the third quarter for Prague. Most importantly, Matevz Mazic assumed the role of the new chief executive officer in August. He replaced Yaniv Sherman, who held the position for just over a year.

Despite Prague’s quarterly financial deficit, new CEO Mazic was optimistic about the third quarter. He specifically highlighted that new and expanded collaborations demonstrate its long-term expansion plans.

Key highlights of the third quarter include the release of content with FanDuel in Michigan and Connecticut, as well as a global distribution agreement with 888. Prague also signed a content partnership with PokerStars, launched new games with Kindred’s Unibet in the UK, and went live with Bet365 in Ontario.

“The global availability of our proprietary and exclusive third-party content is accelerating, particularly with an increasing number of top-tier operators,” Mazic said.

We anticipate further global market penetration of these amusements in the final quarter of the year and throughout the coming year.

During the previous quarter, we introduced twelve new self-developed and exclusive third-party games in the four largest regulated online gambling markets in the United States, and we anticipate continuing to release new games at this rate or faster over the following year.

We are also expanding our operations in the European market, having launched fifteen self-developed and exclusive third-party games in the previous quarter, including partnerships with some new clients in the region. We continue to hold a leading platform provider position in the Netherlands, working with operators we estimate account for approximately thirty percent of the total gambling revenue in that market.

Bragg incurred a net loss in the previous quarter due to increased costs.
While earnings increased year-over-year, expenditures also increased in the previous quarter. Cost of sales rose slightly by one point nine percent to ten point seven million euros, while sales, general and administrative expenses increased by eight point three percent to thirteen million euros.

Bragg also noted a deferred consideration revaluation loss of one point one million euros, with net financing costs adding another four hundred and fifty thousand euros. This resulted in a pre-tax loss of two point six million euros, up from a one point nine million euro loss last year.

After paying three hundred and sixty-four thousand euros in income tax and factoring in a negative cumulative foreign exchange adjustment of six hundred and eleven thousand euros, the net loss was three point six million euros, compared to a profit of two hundred and thirteen thousand euros in two thousand twenty-two. However, it is worth noting that last year’s total included a positive cumulative foreign exchange adjustment of two point two million euros.

In addition, adjusted EBITDA increased by seventy-two point seven percent year-over-year to three million euros.

During the third fiscal period, Prague experienced a financial deficit of eight million euros.

Over the initial nine months concluding on September 30, the overall net deficit reached four point eight million euros. Despite a rise in revenue of eighteen point one percent to thirty-seven point nine million euros, expenditures in various areas escalated, mirroring the trends observed in the third quarter.

Sales, general, and administrative expenses climbed thirteen point four percent to thirty-eight million euros, while a price reassessment also contributed to a net deficit of three hundred eighty-seven thousand euros. Prague partially offset this loss with a gain of four hundred thirty-five thousand euros from convertible debt resolution.

After accounting for net financial charges of one point four million euros, Prague’s pre-tax deficit totaled one point eight million euros, compared to one point five million euros in the preceding year. Taxes amounted to one point three million euros, and a negative cumulative translation adjustment of one point eight million euros was generated.

This resulted in a net loss of four point eight million euros, exceeding the four point four million euros recorded in the previous year. However, adjusted EBITDA experienced a renewed increase, climbing forty-eight point eight percent to twelve point five million euros.

Despite the revenue reduction, Prague reaffirmed its profit anticipations.

In light of this data, Prague reconfirmed its full-year profit expectations for the year ending on December 31.

Revenue is projected to be between ninety-five million and ninety-seven million euros. Additionally, adjusted EBITDA is expected to fall between fifteen point five million and sixteen point five million euros.

Looking ahead, Mazí maintains an optimistic outlook, emphasizing revenue growth and Prague’s long-term potential.

He stated, “These outcomes reflect, in part, the shift in revenue composition towards products with higher margins.”

Were diligently working on a collection of exciting projects to boost our revenue and expand our business. We’re developing our own games, securing exclusive rights to other titles, and collaborating with companies to manage their online gaming accounts. We’re also finding ways to streamline our operations and reduce expenses.

We anticipate generating even greater revenue, increasing our profits, and enhancing our efficiency as we release more of these top-notch games in partnership with additional companies.

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