US and Italy-facing operator and supplier Elys Game Technology recorded revenue of $25.8m for the first half of the year, a 72.3% increase from 2020, as it prepares to launch its US B2B operations.
The revenue came from turnover of $463.3m, up 120.2%.
The vast majority of this turnover was online at $451.2m, a 247.8% increase, while retail brought in the other $12.0m, a decline of 56.9%.
Michele Ciavarella, Elys’ executive chairman, said the land-based division continued to be affected by the novel coronavirus (Covid-19) pandemic, but that he hoped for stronger results from that segment in H2.
“We are very pleased with the remarkable growth Elys achieved during the first six months of this year, particularly since the Covid pandemic continues to restrict certain business activities affecting our land-based operations,” he said. “We expect that some land-based betting shops could re-open by the beginning of the 2021-22 European soccer season which may provide additional B2C growth in Italy for the remainder of 2021.”
After winnings, this left gross gaming revenue of $32.3m, an 84.6% increase.
The business then paid $6.6m in Italian gaming taxes to the Agenzia delle dogane e dei Monopoli (ADM), leaving net gaming revenue of $25.7m, a 71.3% increase.
After then receiving a further $189,434 in B2B services revenue, 656.0% more than 2020, Elys recorded revenue of $25.8m.
However, the business had costs and expenses of $29.2m, up 83.6%. Of these, $20.3m were in selling expenses, almost exactly double the amount paid in 2020, while $8.9m, up 56.1%, were in general and administrative expenses.
This led to an operating loss of $3.3m, up 266.7%.
Elys received $370,365 in other income, but paid $28,138 in other expenses, plus $10,043 in interest expenses, $12,833 in amortisation of debt and $92,500 in losses from the change in value of financial securities.
This led to a pre-tax loss of $3.1m, up 74.7% from 2020’s loss. After $276,501 in taxes, Elys made a net loss of $3.4m, which was 42.8% more than it lost the prior year.
Looking just at the second quarter of the year, Elys brought in revenue of $11.7m. After expenses of $14.4m, it made an operating loss of $2.7m.
After other income and expenses, Elys made a pre-tax loss of $2.9m. It received a $112,113 tax benefit for a net loss of $2.8m.
The quarter also saw Elys acquire platform provider US Bookmaking, allowing it to expand its B2B operations to the US. After the period ended, it then launched its new platform Elys Gameboard US, at the National Indian Gaming Association (NIGA) Trade Show. The platform is currently used by Churchill Downs Incorporated’s United Tote subsidiary.
“Over the next six to 12 months, US Bookmaking expects to integrate our recently debuted US Elys Gameboard system on its robust pipeline of new operators, culminating with the conversion of existing operators as such contracts expire in late 2022,” Ciavarella said.
“The addition, US Bookmaking continues the global diversification of Elys’ corporate infrastructure by expanding our B2B footprint into North America while leveraging the strong growth that we are experiencing in our core European-based B2C business.”