Esports Entertainment Group posts $1.8m loss in first financial results
Malta-based operator aiming for $42m in total annual revenue by 2022 after going public in April
Esports Entertainment Group (EEG) has reported a net loss of $1.8m for Q3 2020 citing reduced UK revenue from its acquired Argyll Entertainment subsidiary.
The Malta-based operator published its first financial results since going public on Nasdaq in April and expects performance to improve heading into 2021.
EEG recorded revenue of $222,392 for Q3 2020, up from $0 in Q3 2019, which was mainly derived from the acquisition of Argyll in May, resulting in EEG becoming a revenue-generating business.
However, the group noted a $1.8m loss due to measures taken following a UK Gambling Commission audit of Argyll.
Looking forward, EEG stated post-Q3, gross gaming revenue and net revenue was returning to pre-Covid levels.
After the reporting period in October, EEG recorded more than $16m in total handle and revenue of more than $600,000.
EEG reaffirmed its prediction that it would comfortably generate $13m in total revenue in 2021, with that figure rising to $25m in 2022.
The total revenue figure, including revenue gained from the group’s latest acquisitions in the esports industry, such as those of Helix Esports and ggCircuit, is expected to hit $42m in 2022 with EBITDA of $2m.
Grant Johnson, EEG CEO, said Covid-19 had created the perfect storm for the rise of esports betting and 2020 had laid the bedrock for a sustainable future for the vertical.
He said: “We have achieved many significant milestones since uplisting to the Nasdaq in April. The Covid-19 pandemic has absolutely accelerated the rapid growth of esports leading to mainstream broadcasts to national TV audiences.
“We believe the successes achieved this year provide an extremely strong foundation for long-term growth while offering investors a true pure play opportunity in the burgeoning world of global esports,” he added.
Johnson went on to hint at further M&A efforts in the future as EEG looks to consolidate itself as a major player in the industry.
Johnson said: “As we look ahead, we believe the acquisitions we have made as well as those we plan to make, combined with a growing list of world-class partnerships, Esports Entertainment is in a great position to accelerate the monetisation of our robust three-pillar strategy.”