Dynamic quarter with increasing momentum

Net Gaming Europe AB (publ) had a stable quarter, in which we gradually increased productivity. Refinancing has been secured after the end of the quarter, giving the Company scope to continue to develop the business with a focus on profitable organic growth.

First quarter 2020

• Revenue amounted to EUR 3,191 (4,053) thousand.
• EBITDA amounted to EUR 1,742 (2,553) thousand.
• Profit after tax was EUR 2,759 (1,941) thousand. 
• Earnings per share after dilution amounted to EUR 0.036 (0.026).
• New Depositing Customers (NDC) declined by -16% (-15%).
• Cash flow from operating activities amounted to EUR 1,625 (2,835) thousand.

Significant events in the quarter

• The Board appointed Robert Andersson as new President and CEO with immediate effect. The purpose of the change is to create better conditions for Net Gaming to return to growth while maintaining profitability and to generate shareholder value in the short and long term. In connection with the change, Marcus Teilman left his positions as CEO and Board member.
• Net Gaming made further repurchases of the Company’s own corporate bonds on the market, corresponding to a nominal amount of SEK 55 million. Including the previously communicated repurchases of SEK 67 million, Net Gaming’s bond repurchases amount to SEK 122 million.
• Net Gaming provided an update on results for Q1 2020 and the impact of COVID-19 and decided to postpone the AGM and publication of the annual report.  

Significant events after the quarter

• In April, Net Gaming applied for bondholders’ approval concerning certain changes to the terms of the Company’s bond.
• Refinancing has been secured, with certain changes to the terms, primarily an extension of the maturity to September 2022 and a retained interest rate of 7.25%.
• The new CEO is reviewing the Company’s operations in order to create a clearer operational organisation with a focus on driving the business forward.
• The Company’s impact from COVID-19 after the end of the period remains in line with the communication that was issued on 31 March 2020. Demand for casino and poker traffic shows a continuing positive trend after the end of the period.
• The 2019 annual report was published on 30 April.
   

CEO’s comments: Join the Ride
I have followed most companies in the gaming and affiliate sector for a long time. One company that has always piqued my interest is Net Gaming – a company with great potential but, in my perception, one that has not gone the whole distance. It is now my great privilege to be the Company’s newly appointed CEO and to work with our employees to ensure that the Company’s development is reversed. Looking at the last quarter, with revenue of EUR 3,191 thousand and EBITDA of EUR 1,742 thousand, we see that we have continued to show a marginal decline. Our focus now is to utilise the Company’s potential in the form of employees, customers, end users, brands and geographical markets, as we move forward at high speed.

The Company is full of untapped talent in a setting where organisation and workflows have not been optimally designed and to some extent have had the wrong focus. What is positive about this is that we have worked together as a team to quickly identify the “low-hanging fruits” and the change work is now progressing at a rapid pace. The plan ahead is clear and I am convinced that we have a bright future. It is now important to focus on operational efficiency while building a strong organisation for the future.

As we leave the first quarter, we can look ahead at what is interesting and where the focus should be. First and foremost, we will have to drive change in order to drive growth and profitability. It feels like the whole Company is part of this and understands the importance of changing the way of thinking and working, ensuring our customers and users come first, which is what creates our business. As far as this industry is concerned, Net Gaming is an “old” company that is finding its way back to its entrepreneurial spirit and speed – the desire and understanding are there!

In April, we initiated a voting procedure to change certain terms of our outstanding bond, including extending the due date by two years to September 2022. This has now been completed, which is very pleasing and a show of strength from the Company in the current market. Securing the refinancing will be good for both shareholders and bondholders and it gives us breathing space to continue to develop the Company with a focus on profitable organic growth, thereby reducing the net debt/EBITDA ratio and building shareholder value in the future.

We now start to write an important new chapter in the Company’s history, in which those of us who are lucky enough to work here will join forces to build a stronger, more profitable and more fun company, which will benefit all our customers, end users, suppliers and, of course, you as shareholders.

Join the Ride

Robert Andersson, President and CEO
 

CEO Robert Andersson and CFO Gustav Vadenbring will present the report at 10:00 AM, followed by a questions and answers session. The presentation will be held in English and can be followed at netgaming.se or via https://tv.streamfabriken.com/net-gaming-europe-q1-2020
 

To join the presentation by phone, call one of the following numbers:

From Sweden: +46856642703
From the UK: +443333009260
From the US: +18446251570

The webcast and presentation material will be available at netgaming.se and can be viewed afterwards.

For further information, please contact:

Robert Andersson, President and CEO
+356 9999 8017

Gustav Vadenbring, Group CFO
+356 9967 6001

Net Gaming Europe AB (publ)
Telephone: +46 8,410,380 44
E-mail: info@netgaming.se
Website: www.netgaming.se

Certified Adviser: FNCA Sweden AB, info@fnca.se, +46 8 528 00 399

This information is information that Net Gaming Europe AB (publ) is required to disclose under the EU Market Abuse Regulation. The information was provided by the contact person above for publication on 20 May 2020 at 08.00 CET.
 

About Net Gaming
Net Gaming owns, operates and develops high-quality comparison sites, mainly in iGaming affiliation, for the purpose of helping our partners by channelling high-quality users to the Company’s customers – primarily iGaming operators. Through the sites, Net Gaming generates high-quality users, primarily to global iGaming operators. The Company, which was founded in 2003, has just over 70 employees and is headquartered in Malta. The share (NETG) is listed on Nasdaq First North Growth Market Premier. Certified Adviser: FNCA Sweden AB, info@fnca.se, +46 8 528 00 399

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