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NeoGames Announces Third Quarter 2021 Results

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 NeoGames S.A., a technology-driven provider of end-to-end iLottery solutions, announced today financial results for the third quarter ended September 30, 2021.

Moti Malul, Chief Executive Officer of NeoGames, said: “We continue to position ourselves well for the long-term, investing in our technology solutions and our operational capabilities and executing on our business plan as a global leader of iLottery solutions for national and state-regulated lotteries. This quarter, we have seen growth in several of our accounts with Virginia and North Carolina in the US continuing their good performance, while in Europe Sazka’s online penetration has ramped up to represent a significant percentage of their total GGR. Subsequent to quarter end, our Games Studio continued its expansion with the launch of our suite of premium eInstant games with Lottomatica in Italy. We also continue to invest in PlayAlberta, as we launched draw games late in the second quarter, and launched sports betting in August. On the state authorization front, momentum has progressed in the U.S., with Connecticut and West Virginia in various stages of public procurement processes, which we see as a positive step towards further market expansion. All of these highlights reflect our ability to capitalize on our expanding market opportunity and cement NeoGames as the leader in the industry.”

Third Quarter 2021 Financial Highlights

  • Revenues were $11.9 million during the third quarter of 2021, compared to $13.1 million during the third quarter of 2020. In addition, the Company’s share of NPI revenues was $8.3 million during the third quarter of 2021, compared to $2.5 million during the third quarter of 2020, representing an increase of 233.2% year-over-year. The total of revenues and the Company’s share of NPI’s revenues was $20.2 million during the third quarter of 2021 compared to $15.6 million during the third quarter of 2020, representing an increase of 29.7% year-over-year.
  • Comprehensive income was $1.5 million, or $0.06 per share, during the third quarter of 2021, compared to comprehensive income of $2.5 million, or $0.11 per share, during the third quarter of 2020, .
  • Adjusted EBITDA1 was $7.5 million during the third quarter of 2021, compared to an Adjusted EBITDA of $7.8 million during the third quarter of 2020 representing a decrease of 3.8% year-over-year.
  • Network Net Gaming Revenue (“NGR”)2 was $179 million during the third quarter of 2021, compared to $126 million during the third quarter of 2020, representing an increase of 42.1% year-over-year.

_______________
1 Adjusted figures represent non-IFRS information. See “Non-IFRS Financial Measures and Key Performance indicators” and the tables at the end of this release for an explanation of the adjustments and reconciliations to the comparable IFRS numbers.
2 Non-GAAP Financial Measures and Key Performance indicators” for additional information about this key operating metric.

Third Quarter 2021 Business Highlights

  • Rolled out progressive jackpot instant content with three customers representing an innovative development for iLottery players across our platform.
  • VirginiaiLottery program continued its growth performance, with significant growth each quarter it has been live since launch in the third quarter of 2020.
  • Launched online sport betting in Alberta, which follows the recent launches of Live Dealer and draw-based games in previous quarters.
  • Went live with Ceasars Entertainment in Arizona as part of their Liberty platform, which is now live in 10 states with an online sport betting and/or iGaming offering.
  • Subsequent to the quarter end, launched the Company’s suite of premium eInstant games with Lottomatica, further expanding NeoGames’ footprint in the Italian lottery market.
  • Completed an underwritten public offering of ordinary shares including full exercise of the underwriters’ option to purchase additional ordinary shares.

Guidance

The Company is raising its fiscal year 2021 Revenue and Share in NPI Revenues Interest Guidance to between $82.5 million and $84.5 million, compared to the prior range of between $75 million and $79 million, representing a 41% increase year-over-year on the midpoint.

Conference Call & Webcast Details

NeoGames will host a live conference call and audio webcast on Thursday, November 11, 2021 at 8:30 a.m. Eastern Time, during which management will discuss the Company’s third quarter results and provide commentary on business performance. A question and answer session will follow the prepared remarks.

The conference call may be accessed by dialing (833) 301-1152 for U.S. domestic callers or (914) 987-7393 for international callers. Once connected with the operator, please provide the conference ID of 6643079.

A live audio webcast of the earnings conference call may be accessed on the Company’s website at ir.neogames.com. The replay of the audio webcast and accompanying presentation will be available on the Company’s investor relations website shortly after the call for a period of 30 days.

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Malta Prepares For EU Budget Battle To Stave Off Gambling Levy

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Malta’s Prime Minister has said his nation will veto any attempts by the EU to introduce a bloc-wide online gambling levy, threatening to place the industry at the centre of febrile European politics.

Robert Abela has told Malta’s parliament that he would use his nation’s member state veto to block the passage of the next EU budget, if a proposed gambling levy is included.

The budget, formally known as the Multiannual Financial Framework (MFF), lays out how the EU will spend its €2trn budget from 2028 to 2034.

The prospect of adding a continent-wide tax to the budget remains only a proposal, but the idea has heavyweight backing.

Vice-president of the European Parliament Victor Negrescu is spearheading these efforts, arguing that a fast-growing digital industry that generates billions in revenue should be subject to EU-level taxation.

Negrescu says that the levy could generate between €2-4bn every year.

“This industry fully benefits from the EU’s single market, digital infrastructure and crossborder access, but operates under fragmented rules, unequal taxation and insufficient enforcement,” he said.

The online gambling sector might well quibble with the specifics of these claims.

The idea that it “fully benefits” from the EU single market may have been unassailably true in the point-of-supply era, but the subsequent fragmentation of national rules that Negrescu refers to has significantly complicated that picture.

Nevertheless, backing for the levy from a senior European politician has naturally spooked the industry and its primary champion within the EU, Malta.

The levy would be so damaging to Malta’s economic interests that it is willing to use its most powerful EU instrument by executing a veto in the European Council in order to block the budget from being approved.

That would likely plunge the island nation into the centre of a political firestorm, but recent history suggests that smaller EU nations and their allies can successfully disrupt budget negotiations.

During discussions over the 2020 EU budget, Poland and Hungary successfully secured concessions after they both threatened to veto the MFF over rule-of-law requirements.

Malta will also hope to rely on support from the Friends of Cohesion, an informal alliance of 16 nations concerned with regional development, of which it is a part.

Negrescu’s pledge to pair his levy with a “clear EU directive against illegal and unlicensed platforms” is unlikely to satisfy the online gambling industry, despite growing complaints of a rampant black market from a number of quarters.

Malta strikes again

In simple terms, Malta is seeking to protect an industry which accounts for 10 percent of its gross domestic product.

The nation has shown a clear willingness to ignore the EU’s wishes in order to shield the many gaming firms that host their headquarters within its borders.

Most notably, the creation of Bill 55 has successfully protected local companies from having to repay hundreds of millions of euros in player refund settlements.

Ongoing cases before the Court of Justice of the European Union suggest that Europe’s top judges will soon rule against Bill 55, which is now Article 56A of Malta’s gambling act.

The European Commission also launched infringement proceedings against Malta over the provision

Tax troubles.

There are so far no specifics on how the levy would be calculated or what value it would be set at, but beyond Malta an additional levy would also be extremely challenging for operators in European markets already struggling with high tax burdens.

This includes the Netherlands, where a government report released this week has shown that staggered increases to taxes of 37.8 percent of gross gambling revenue (GGR) have failed to deliver any benefit to the country’s budget.

Even a relatively slight increase to this tax rate could send more operators scurrying out the market and see channelisation dive further than its current rate of 55 percent.

Nations like France, where online betting is taxed at 59.3 percent of GGR, or Portugal, with its 8 percent turnover tax on online sports betting, would also feel an impact.

Negotiations over the contents of the EU budget are set to continue for several months, with the approval process expected to be completed in late 2026 or early 2027.

Leaders in the Council of Europe have agreed to come to a preliminary deal on the MFF by October, according to a coordinated statement issued earlier this month.

Malta’s devout opposition to a possible gambling levy is just one of a range of issues under discussion, including a stark divide between nations such as Germany, which favour spending cuts, and the Friends of Cohesion, who want additional cash for agriculture and regional funding.

The post Malta Prepares For EU Budget Battle To Stave Off Gambling Levy appeared first on EE Gaming | Global iGaming & Tech Intelligence Hub.

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G2 drops limited-edition One Piece streetwear capsule on June 25

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The esports organisation’s second anime apparel collaboration will be sold exclusively via g2esports.com/shop.

G2 is launching a limited-edition G2 | One Piece capsule collection on June 25, with the drop available exclusively through the organisation’s online store at g2esports.com/shop.

The collection is inspired by One Piece’s Gear 5 Monkey D. Luffy and includes hoodies, zip-ups, t-shirts, caps, sleeves, and tote bags. According to G2, the items use a black-and-white palette and feature a minimalist embroidered logo alongside a custom G2 | One Piece Jolly Roger that combines the G2 samurai emblem with Luffy’s straw hat.

“At G2, we’re continuing to push the culture and fashion of esports beyond competition alone, and this One Piece collection is a natural extension of that,” says Sabrina Ratih, COO of G2 Esports. “We wanted to create a capsule that continues to elevate the esports fashion space – understated, premium, and stylish enough for everyday wear, while still carrying the spirit of adventure, ambition, and individuality that defines One Piece and G2 alike. Every piece is designed to bridge the gap between fandom and everyday style, and continuing our mission to redefine what esports fashion can be.”

G2 described the drop as its second anime collaboration, following a previous apparel collaboration with Solo Leveling. The company positioned the release as part of its broader effort to connect esports, anime, and streetwear.

One Piece debuted in 1999 and remains one of the largest anime franchises globally. G2 cited over 600 million manga copies sold and more than 1,160 episodes for the series.

The post G2 drops limited-edition One Piece streetwear capsule on June 25 appeared first on EE Gaming | Global iGaming & Tech Intelligence Hub.

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Ygam joins four UKRI-funded gambling harms research partnerships

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Projects sit within UKRI’s Research Programme on Gambling and the GHR-UK Evidence Centre, backed by the statutory levy.

Ygam has been named as a partner on four projects funded through the UKRI Research Programme on Gambling, supported by the statutory levy. The charity will work with academic teams including the University of Birmingham, Bournemouth University, the University of Plymouth, Lancaster University, and Liverpool John Moores University.

The four projects sit within the Gambling Harms Research UK (GHR-UK) Evidence Centre, which coordinates 19 one-year Innovation Partnerships under the programme. UKRI has been appointed by the UK Government to oversee research commissioned through the new statutory Gambling Levy. Under the levy, 20% of annual funding will be allocated to research, equating to £22.1 million in 2025/26.

Emily Tofield, Chief Executive of Ygam, said: “We are pleased to be working in partnership with leading university partners, contributing our expertise in a key strategic area of our work. A defining strength of our approach is that it is grounded in robust insight and research, underpinning everything we do. This enables us to understand how and why harms emerge and translate that into practical, preventative education that is credible and scalable. We look forward to achieving these outcomes together and informing effective measures to prevent harms among children and young people.”

Ygam said its advisory panels — including young people, individuals with lived experience, community and faith leaders, gaming and esports representatives, and student ambassadors — will help shape the research to reflect “real-world experience and diverse community perspectives.”

The four partnerships are: INTEGRATE (University of Birmingham, Ygam, Al-Hurraya and Community Connexions), focused on intersectional gambling harm and interventions for children, young people and emerging adults; “From Evidence to Action: Safeguarding Neurodivergent Young People in Gamified Digital Environments” (Bournemouth University, Ygam, Work’n’Diversity CIC), focused on gambling-like risks in gamified digital environments; GRASP (University of Plymouth-led partnership including NatCen, NHS and third-sector organisations, and Ygam), mapping support pathways and gaps in prevention and recovery; and GRACE-Net (Lancaster University and Liverpool John Moores University with local authorities, NHS partners, third-sector organisations and Ygam), testing collaborative approaches in the North West of England and sharing learning more widely.

The post Ygam joins four UKRI-funded gambling harms research partnerships appeared first on EE Gaming | Global iGaming & Tech Intelligence Hub.

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