Elys Gaming Technologies, previously known as Newgioco, observed a surge in its earnings by 39.1% to $14.1 million. However, the enterprise encountered a deficit due to the expenses associated with expanding into the United States and narrow profit margins.
Elys’s income was generated from a turnover of $243.2 million, a substantial 109.4% rise. The majority of this income ($231.3 million, up 148.6%) originated from online wagering. The remaining $11.8 million (down nearly 50%) stemmed from traditional betting.
“As evidenced by the record $14.2 million in revenue in the initial quarter of 2021, a 39% increase compared to the corresponding period last year, the total quarterly wagering volume for the first quarter of 2021 reached a record of approximately $243 million, demonstrating the exceptional execution of our previously established disciplined growth strategy,” stated Matteo Monteverdi, Chief Executive Officer, who assumed his position in November 2020.
The company disbursed $225.8 million in winnings, resulting in a gross gambling revenue of $17.4 million, a 48.8% increase. Of this, $15.7 million originated from online, up 149.0%, while land-based revenue decreased by 69.7% to $1.7 million.
After paying $3.3 million in taxes to the Italian Customs and Monopoly Agency (ADM) and incurring $92,000 in betting platform service fees, the company’s net gambling revenue was $14.1 million, up 39.2%.
In spite of this, the firm produced $14.8 million in costs and expenditures, a rise of 64.4%. Of this sum, $10.7 million was selling expenses, such as payments made to sales representatives. Because these payments are based on quantity, not income, the lower profit margin made these expenses more noticeable.
Another $4.1 million in costs were classified as general and administrative expenses, which increased by 47.1%, primarily reflecting a rise in stock-based compensation and corporate salaries, many of which were linked to the expansion in the United States.
This resulted in an operational loss of $650,000, as compared to a profit of $1.1 million in 2020. However, after taking into account other income, including securities gains, the loss was decreased to $221,000.
Elys then paid $339,000 in taxes, resulting in a net loss of $610,000, as compared to a profit of $158,000 in the same period last year.
After taking into account currency fluctuations, Elys reported a consolidated loss of $954,000, as compared to a profit of $46,000 in 2020.
“We are more positive than ever about the prospects for our European and North American operations, especially as the pandemic begins to subside and land-based operations resume,” said CEO Michele Ciavarella. “Given our successful track record in Italy, we believe we are ideally positioned to be a competitor in the changing regulatory environment, opening up new markets in North America and Europe.”
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