Gambling.com Group Limited, a leading provider of digital marketing services active exclusively in the global online gambling industry, today announced its operating and financial results for the third quarter ended September 30, 2021.

Third Quarter 2021 Financial Highlights

• Revenue of $10.1 million grew 37% compared to $7.4 million in the same period for the prior year
• Net income of $4.7 million, or $0.13 per diluted share, compared to a net income of $2.3 million, or $0.08 per diluted share, in the same period for the prior year
• Adjusted EBITDA of $3.5 million decreased 14% compared to $4.0 million in the same period for the prior year, representing an Adjusted EBITDA margin of 34%¹
• Free cash flow of $0.8 million decreased 81% compared to $3.9 million in the same period for the prior year²

Third Quarter 2021 Business Highlights

• Completed successful public listing of common shares on the Nasdaq Global Market under the ticker symbol “GAMB”
• Announced appointment of Mr. Daniel D’Arrigo to Board of Directors
• Received temporary supplier license from the Arizona Department of Gaming to provide marketing services to licensed operators in the state and launched free-to-use comparison of legal online sports betting services on BetArizona.com
• Launches of Marylandbets.com, casinosource.nl and gambling.com/nl providing bettors in Maryland and the Netherlands with trusted and up to date gambling information to help them place safe and secure legal wagers
• Completed acquisition of domains suitable for targeting the US market

“Our financial performance in the third quarter remained strong as we grew revenue by 37% compared to the prior year and, despite the third quarter being the seasonally slowest quarter of the year, delivered an Adjusted EBITDA margin of 34%,” said Charles Gillespie, Chief Executive Officer and co-founder of Gambling.com Group. “Importantly, after the quiet summer months of July and August, we delivered all-time-high revenue in September. With the launch of Arizona and the kickoff of the NFL season, we saw a significant uplift in U.S. revenue in September and our U.S. performance exceeded our internal expectations. Entering the quarter with good momentum we are encouraged by the start to our seasonally stronger fourth quarter. We remain highly focused on prudently growing the Company through both sustained organic growth and future accretive acquisitions which we continue to actively pursue”

¹ Adjusted figures represent non-IFRS information. See “Non-IFRS Financial Measures” and the tables at the end of this release for an explanation of the adjustments and reconciliations to the comparable IFRS numbers.

² Adjusted figures represent non-IFRS information. See “Non-IFRS Financial Measures” and the tables at the end of this

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release for an explanation of the adjustments and reconciliations to the comparable IFRS numbers.

Third Quarter 2021 vs. Third Quarter 2020 Financial Highlights

		THREE MONTHS ENDED SEPTEMBER 30,								CHANGE
		2021 Advertisement				2020				$				%
		(in thousands USD, except for share and per share data, unaudited)
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME DATA Advertisement
Revenue		$	10,123			$	7,406 Advertisement			$	2,717				37	%
Operating expenses Advertisement			(7,722	)		$	(3,931	) Advertisement		$	(3,791	)			96	% Advertisement
Operating profit			2,401				3,475				(1,074	) Advertisement			(31	)%
Income before tax			2,694				2,609 Advertisement				85				3	%
Net income for the period attributable to the equity holders		$ Advertisement	4,675			$	2,303			$	2,372 Advertisement				103	%
Net income per share attributable to ordinary shareholders, basic			0.14				0.08 Advertisement				0.06				75	%
Net income per share attributable to ordinary shareholders, diluted			0.13 Advertisement				0.08				0.05				63	%

n/m = not meaningful

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		THREE MONTHS ENDED SEPTEMBER 30,								CHANGE
		2021				2020				$ Advertisement				%
		(in thousands USD, unaudited)
NON-IFRS FINANCIAL MEASURES
Adjusted EBITDA		$ Advertisement	3,464			$	4,027			$	(563 Advertisement	)			(14	)%
Adjusted EBITDA Margin			34 Advertisement	%			54	%		n/m				n/m Advertisement
Free Cash Flow			754				3,917				(3,163	) Advertisement			(81	)%

n/m = not meaningful

		THREE MONTHS ENDED SEPTEMBER 30,								CHANGE Advertisement
		2021				2020				Amount				%
		(in thousands, unaudited) Advertisement
OTHER SUPPLEMENTAL DATA
New Depositing Customers (1)			27				28				(1 Advertisement	)			(4	)%

⁽¹⁾      We define New Depositing Customers, or NDCs, as unique referral of a player from our system to one of our customers that satisfied an agreed metric (typically making a deposit above a minimum threshold) with the customer, thereby triggering the right to a commission for us.

		AS OF SEPTEMBER 30, Advertisement		AS OF DECEMBER 31,		CHANGE
		2021		2020		$ Advertisement		%
		(Unaudited)
		(in thousands, USD)
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION DATA
Cash and cash equivalents Advertisement		$53,160		$8,225		$44,935		n/m
Working capital (2) Advertisement		55,064		10,059		45,005		n/m
Total assets Advertisement		91,648		45,383		46,265		n/m
Total borrowings Advertisement		5,919		5,960		(41)		n/m
Total liabilities Advertisement		11,373		11,171		202		n/m
Total equity Advertisement		80,275		34,212		46,063		n/m

⁽²⁾      Working capital is defined as total current assets minus total current liabilities.

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n/m = not meaningful

Revenue

Total revenue in the third quarter increased 37% to $10.1 million compared to $7.4 million in the comparable period for the prior year. On a constant currency basis, revenue increased $2.3 million, or 30%. The increase was driven by improved monetization of NDCs that we attribute to a combination of technology improvements and changes in product and market mix. NDCs decreased 4% to 27,000 compared to 28,000 in the prior year.

Our revenue disaggregated by market is as follows:

		THREE MONTHS ENDED SEPTEMBER 30, Advertisement								CHANGE
		2021				2020				$				% Advertisement
		(in thousands USD, unaudited)
U.K. and Ireland		$	4,483			$ Advertisement	4,311			$	172				4	% Advertisement
Other Europe			2,718				1,162				1,556				134 Advertisement	%
North America			2,270				1,081				1,189 Advertisement				110	%
Rest of the world			652				852 Advertisement				(200	)			(23	)%
Total revenues Advertisement		$	10,123			$	7,406			$ Advertisement	2,717				37	%

Revenue increases were primarily driven by organic growth in our Other Europe and North American markets.

Our revenue disaggregated by monetization is as follows:

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		THREE MONTHS ENDED SEPTEMBER 30,								CHANGE
		2021				2020				$ Advertisement				%
		(in thousands USD, unaudited)
Hybrid commission		$	2,808 Advertisement			$	3,847			$	(1,039	) Advertisement			(27	)%
Revenue share commission			829				794 Advertisement				35				4	%
CPA commission			5,455 Advertisement				2,535				2,920				115	%
Other revenue Advertisement			1,031				230				801				348	% Advertisement
Total revenues		$	10,123			$	7,406 Advertisement			$	2,717				37	%

Revenue increases were driven primarily by additional CPA commission and Other revenue. The increase in Other revenue was driven primarily by bonuses related to achieving certain operator NDC performance targets.

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Our revenue disaggregated by product type from which it is derived is as follows:

		THREE MONTHS ENDED SEPTEMBER 30,								CHANGE
		2021				2020 Advertisement				$				%
		(in thousands USD, unaudited)
Casino		$ Advertisement	7,965			$	6,354			$	1,611 Advertisement				25	%
Sports			2,076				858 Advertisement				1,218				142	%
Other			82 Advertisement				194				(112	)			(58	)% Advertisement
Total revenues		$	10,123			$	7,406 Advertisement			$	2,717				37	%

Revenue increases were driven by growth in revenue from casino and sports products.

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Operating Expenses

		THREE MONTHS ENDED SEPTEMBER 30,								CHANGE
		2021				2020 Advertisement				$				%
		(in thousands USD, unaudited)
Sales and marketing expenses		$ Advertisement	3,587			$	1,790			$	1,797 Advertisement				100	%
Technology expenses			1,123				663 Advertisement				460				69	%
General and administrative expenses			2,978 Advertisement				1,402				1,576				112	%
Allowance for credit losses and write offs Advertisement			34				76				(42	)			(55 Advertisement	)%
Total operating expenses		$	7,722			$ Advertisement	3,931			$	3,791				96	% Advertisement

n/m = not meaningful

Total operating expenses increased by $3.8 million to $7.7 million compared to $3.9 million in the prior year. On a constant currency basis, operating expenses increased by $3.5 million to $7.7 million compared to $4.2 million in the prior year. The increase was driven primarily by headcount across Sales and Marketing, Technology, and General and Administrative functions as we invest in the Company’s organic growth initiatives as well as increased administrative expenses associated with operating as a public company.

Sales and Marketing expenses totaled $3.6 million compared to $1.8 million in the prior year. The increase was driven primarily by increased wages and salary expenses associated with increased headcount and professional services.

Technology expenses totaled $1.1 million compared to $0.7 million in the prior year. The increase was driven primarily by increased wages and salary expenses associated with increased headcount partially offset by capitalized development costs.

General and Administrative expenses totaled $3.0 million compared to $1.4 million in the prior year. The increase was driven primarily by increased wages and salary expenses associated with increased headcount, professional services, and insurance expenses.

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Earnings

Adjusted EBITDA decreased by 14% to $3.5 million compared to $4.0 million in the prior year representing an Adjusted EBITDA margin of 34%. The decrease was driven primarily by increased operating expenses partly offset by increased revenue.

Operating profit in the third quarter decreased 31% to $2.4 million compared to $3.5 million in 2020. The decrease was driven primarily by a decrease in Adjusted EBITDA and an increase in share-based payments expense.

Net income in the third quarter totaled $4.7 million, or $0.13 per diluted share, compared to net income of $2.3 million, or $0.08 per diluted share, in the prior year. The increase was primarily driven by the recognition of deferred tax assets related to the transferred intangible assets.

Free Cash-flow

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Total cash generated from operations of $1.4 million decreased 65% compared to $4.0 million in the prior year. The decrease was driven primarily by decreased adjusted EBITDA, the settlement of non-recurring IPO-related expenses and income tax payments. Free cash flow totaled $0.8 million compared to $3.9 million in the prior year. The decline was the result of decreased cash flow generated from operations and increased capital expenditures consisting primarily of the acquisition of domain names and capitalized development costs.

Balance Sheet

Cash balances as of September 30, 2021 totaled $53.2 million, an increase of $45.0 million compared to $8.2 million as of December 31, 2020. Working capital as of September 30, 2021 totaled $55.1 million, an increase of $45.0 million compared to $10.1 million as of December 31, 2020.

Total assets as of September 30, 2021 were $91.6 million compared to $45.4 million as of December 30, 2020. Total borrowings, including accrued interest, totaled $5.9 million compared to $6.0 million as of December 31, 2020. Total liabilities were $11.4 million compared to $11.2 million as of December 31, 2020.

Total equity as of September 30, 2021 was $80.3 million compared to $34.2 million as of December 31, 2020.

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The increases in working capital, total assets, and total equity were driven primarily by the net proceeds received from the IPO and operating profit and net income generated by the Company.

2021 – 2023 Financial Targets

Total Revenue Growth		> Average 40%
Adjusted EBITDA Margin3 Advertisement		> Average 40%
Leverage4		< Net Debt to Adjusted EBITDA 2.5x5

2021 Outlook

Elias Mark, Chief Financial Officer of Gambling.com Group, added, “Our third quarter results came in a bit above our expectations and after slow summer trading our financial performance accelerated in September to close out the quarter with the best month in the Company’s history. Our Adjusted EBITDA margin of 34% in the quarter was healthy despite a seasonally slow quarter and investments in scaling the organization for organic growth initiatives and operating as a public company. This is consistent with our prior guidance that our near-term margins may deviate from our average 40% target as we invest in our organic growth plan and pursue our M&A strategy. For the full year, we are reiterating our expectation to achieve both above 40% year-on-year organic revenue growth and approximately 40% Adjusted EBITDA margin. We remain in a very strong financial position after the IPO last quarter which offers us significant optionality going forward to execute our growth plan and each of our capital allocation priorities.”

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Conference Call Details

Date/Time:		Thursday, November 18, 2021, at 9:00 am EST
Webcast:		https://www.webcast-eqs.com/gamb20211118/en Advertisement
U.S. Toll-Free Dial In:		877-407-0890
International Dial In:		+1-201-389-0918

To access the call, please dial in approximately ten minutes before the start of the call. An accompanying slide presentation will be available in PDF format within the “News & Events” section of the Company’s website.

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