• Total Revenue (Q4 2024): EUR27.2 million, up 16% year-over-year.
• Gross Profit (Q4 2024): EUR15.8 million, a 31% increase.
• Gross Profit Margin (Q4 2024): 58%, up 650 basis points.
• Adjusted EBITDA (Q4 2024): EUR4.7 million, a 68% increase.
• Adjusted EBITDA Margin (Q4 2024): 17%, up 530 basis points.
• Total Revenue (Full Year 2024): EUR102 million, up 9% year-over-year.
• Gross Profit (Full Year 2024): EUR54 million, an 8% increase.
• Gross Margin (Full Year 2024): 53%, a decrease of 40 basis points.
• Adjusted EBITDA (Full Year 2024): EUR15.8 million, a 4% increase.
• Adjusted EBITDA Margin (Full Year 2024): 15.5%, down 80 basis points.
• Cash and Cash Equivalents (End of 2024): EUR10.5 million.
• Net Working Capital (End of 2024): EUR11.9 million.
• Revenue Guidance (2025): EUR117.5 million to EUR123 million.
• Adjusted EBITDA Guidance (2025): EUR19 million to EUR21.5 million.

• Warning! GuruFocus has detected 3 Warning Signs with BRAG.

Release Date: March 20, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Bragg Gaming Group Inc (NASDAQ:BRAG) achieved a record high total revenue of EUR27.2 million in Q4 2024, marking a 16% increase compared to Q4 2023.
• The company expanded its market penetration in North America, launching in Delaware and partnering with major operators like MGM, DraftKings, and Fanatics.
• Bragg's proprietary content reached 90% of the US iGaming market, with significant growth in proprietary content revenue, which enhances margins.
• The company launched its proprietary iGaming content in Brazil on the first day of the regulated market, establishing a strong position in this emerging market.
• Bragg Gaming Group Inc (NASDAQ:BRAG) strengthened its executive team with experienced industry experts, supporting its growth trajectory.

Negative Points

• Despite revenue growth, the full-year 2024 gross margin decreased slightly by 40 basis points to 53%.
• The company faces potential regulatory challenges in the Netherlands, which could impact market dynamics and advertising strategies.
• Bragg Gaming Group Inc (NASDAQ:BRAG) has a negative free cash flow, partly due to significant spending on PP&E and intangibles.
• The company's adjusted EBITDA margin for the full year 2024 declined by 80 basis points compared to the previous year.
• There is uncertainty regarding the rollout of the PAM in Brazil, as the current focus is primarily on content.

Q & A Highlights

Q: Can you confirm if the US market was about 5% of revenue in 2024 and if the deal with Caesars will be the primary driver for growth in 2025? A: Yes, the US market was about 5% of revenue in 2024. While the deal with Caesars is significant, a major part of our growth will come from exclusive and proprietary content, such as our slot game Dragon Power Triple Gold. - Robbie Bressler, CFO

Q: Regarding Brazil, you mentioned having more than 30% of licensed operators using your content. Do you expect this to increase to 50% by the end of Q2? A: Yes, we expect to reach 50% by the end of Q2. Our current focus in Brazil is on content, and we are seeing promising results from our proprietary and exclusive content rollouts. - Robbie Bressler, CFO

Q: Can you provide an update on the regulatory environment in the Netherlands and its impact on the market? A: The regulatory environment is still in flux, particularly regarding sports betting advertising. Our business is primarily focused on iCasino, so any impact from sports betting advertising changes would be minimal. We expect the market to decrease slightly in 2025, but our strong market share should provide opportunities to increase it as smaller operators exit. - Robbie Bressler, CFO

Q: What are your short-term and long-term targets for gross margin, given the shift to proprietary content? A: Q4 was exceptional with a 58% gross margin. While we don't expect this to be the run rate for the full year, we are moving in that direction. Our proprietary content, like Dragon Power Triple Gold, is performing well, and we anticipate reaching similar levels by Q4 2025. - Robbie Bressler, CFO

Q: Can you provide an update on your pipeline and any significant opportunities you are working on? A: We have a strong pipeline across different regions, focusing on onboarding operators in Brazil and distributing content in the US. We are also exploring opportunities in Europe and the Americas. Any developments in our pipeline would be accretive to our 2025 guidance. - Matevz Mazij, CEO

Q: Does your pipeline include both organic growth and M&A opportunities? A: Our pipeline is focused on organic growth opportunities. We are actively involved in processes to solidify deals and are well-positioned to capitalize on the expanding US iCasino market. M&A is not a core focus right now, but we remain open to opportunities that increase shareholder value. - Robbie Bressler, CFO

Q: How should we think about seasonality for 2025? A: We expect business as usual, with Q4 typically being the strongest quarter. There are no unusual seasonal impacts anticipated beyond the regular cycle of sports and iCasino play. - Robbie Bressler, CFO

Q: Are there any plans for new US states to go live in 2025? A: While not specifically baked into our pipeline, we are focused on positioning ourselves to capitalize on new opportunities as US states open up. We aim to be well-prepared with strong products and partnerships to capture market share in the expanding US iCasino market. - Robbie Bressler, CFO

For the complete transcript of the earnings call, please refer to the full earnings call transcript.