Online betting and gaming technologies provider GAN has put a 145% year-on-year increase in revenue during the first half down to the growth of its US business.
Group net revenue for the six months to June 30, 2019 amounted to £11.3m (€12.6m/$14.0m), which represents a significant increase on the £4.6m posted in the corresponding period last year.
The expansion of legal sports betting and online gambling in the US meant that revenue from the country was up substantially year-on-year. Real-money gaming US revenue in the first half amounted to £6.6m, compared to just £600,000 during the same period in 2018.
US simulated gaming revenue also rose, to £2.3m, with overall US recurring revenue up 67% on a year-on-year basis. GAN’s US operations accounted for 78% of group revenue in the six-month period.
GAN also noted growth in other markets, with European B2C revenue up from £100,000 to £600,000 and Italian revenue climbing from £1.7m to £1.8m.
In terms of spending, financial expenses increased 31% from £8.0m to £10.5m, with distribution costs up from £4.5m to £6.2m, partly due to a major hardware upgrade and expenses related to a new collaboration agreement that began in September 2018.
Administrative costs also climbed from £3.2m to £4.2m, primarily as a result of GAN hiring more staff for its offices in Las Vegas, Israel and Bulgaria to support its wider expansion plans.
However, such was the level of revenue growth in the period that GAN was able to post a profit after tax of £700,000, compared to a loss of £3m in the first half of last year.
Clean earnings before interest, tax, depreciation and amortisation (EBITDA) came in at £3.0m, which represents a significant improvement on the loss of £300,000 in H1 of 2018.
GAN also noted that earnings per share hit £0.01 in the period, compared to a loss of £0.04 last year.
Dermot Smurfit, chief executive of GAN, paid tribute to its performance in the US and expects ongoing expansion in the country to continue to have a positive impact on the business in the second half and beyond.
“The first half of 2019 saw rapid growth in revenues driven by real money Internet gambling in the US and the accelerating adoption of Internet sports betting by numerous states,” Smurfit said.
“We were pleased to deliver real money Internet gambling across four websites and counterpart mobile apps to end users in two US tates operated by three clients reliant on our technology platform for powering their Internet gambling business activities.
“We have an incredibly positive outlook for the remainder of 2019, as the recent launch of internet sports betting and casino gaming in Pennsylvania, our current sales pipeline and existing contracted clients are projected to significantly enhance GAN’s revenue and EBITDA prospects.”
Confirmation of the first half results comes after GAN last month had revealed a sharp increase in revenue in the second quarter, with this helping to boost its overall performance in the opening six months of the year.
Gross operator revenue in Q2 amounted to $54.8m (£45.2m/€49.6m) in the three months to 30 June, up 128.3% on the $24.0m generated in the same quarter last year, but down 7.3% on the first quarter of 2019.