LONDON (Alliance News) - Gambling software firm GAN PLC said Friday interim losses deepened after costs jumped despite revenue rising, though it did emphasise its sales pipeline is strong.
For the half year ended June, GAN's pretax loss deepened to GBP3.3 million from GBP2.4 million the year prior despite net revenue rising 12% to GBP4.6 million from GBP4.1 million the year before.
Profit performance was hurt by a rise in expenses during the period. Distribution costs rose to GBP4.3 million from GBP3.6 million the year prior while administrative expenses expanded to GBP3.3 million from GBP2.9 million the year before.
"The group continues to benefit from focusing on building its recurring revenue base in both of its primary markets, the US and Italy, while accelerating measures to optimise the underlying cost base of the business without compromising product or customer delivery", Chief Executive Dermot Smurfit said.
Recurring revenue grew at 19% year-on-year and now represents 92% of net revenue at the firm.
Cash stood at GBP5.1 million from GBP2.7 million six months earlier. This was after it raised GBP7.5 million through a 15.0 million share subscription at 50.00 pence per share in May.
Shares in GAN were 1.1% lower at 62.80p on Friday.
"Regulatory delays will impact US real money gaming results in the second half of 2018, but we will continue to invest in resources to prepare for 2019 and beyond," Smurfit added.
"GAN's prospects for 2019 and beyond in real money gambling are very encouraging given the initial results from the launches of internet sports for Paddy Power Betfair's FanDuel Group in New Jersey, internet gaming for Ocean Resort Casino in New Jersey, and the start of customer acquisition marketing for overseas internet casino."
"By way of outlook on 2019, the recent launch of Internet sports betting, the company's current sales pipeline and existing contracted clients are projected to significantly enhance GAN's revenue and earnings before interest, tax, depreciation, and amortisation prospects," Smurfit added.