NEW YORK – 6 July, 2020: Newgioco Group, Inc. (“Newgioco” or the “Company”) (Nasdaq: NWGI), a global sports betting and interactive gaming technology company providing fully integrated, omni-channel sports betting software solutions, announced its operating and financial results for the fiscal year ended December 31, 2019. The Company was delayed in filing its reports due to COVID-19 and the associated lockdowns in multiple international jurisdictions, with especially notable restrictions imposed by the Italian government.
Newgioco generated total revenue of approximately $35.6 million for the year ended December 31, 2019 compared to $34.6 million for the year ended December 31, 2018, representing a modest increase of approximately $1 million or 2.9%. The increase in revenue was primarily attributable to an increase in turnover, or betting handle, to approximately $454.1 million for the year ended December 31, 2019 from $413.2 million for the year ended December 31, 2018. Betting handle increased by approximately $41 million or 9.9%, which was on target with our growth estimates in Italy considering that there were no major international sporting events in 2019 compared to the prior year during which events such as the FIFA World Cup of Soccer occurred.
The increase in web-based handle of approximately $92.5 million or 39.2% was primarily due to the Company’s efforts to convert customers from land-based to online gaming.
Newgioco recorded a loss from operations of approximately $3.0 million compared to $0.2 million for the years ended December 31, 2019 and 2018, respectively, an increase of approximately $2.8 million. The increase in loss from operations was due to the increase in selling expenses associated to commissions paid to retail agents of approximately $3.5 million which was reflected in the growth of betting handle, coupled with costs associated with the acquisition of Virtual Generation, interest on convertible debentures, the costs of listing our shares of common stock on the Nasdaq Stock Market and expenses tied to our planned U.S. operations.
“We are very pleased with the results in our Italian operations during the year ended December 31, 2019. Despite the modest increase in revenue, we were intensely focused on organizational stabilization with the acquisition of Virtual Generation in January 2019, a key component of our betting technology roll-up strategy. The increase we experienced in handle is further evidence of market adoption of our leading-edge Elys betting platform considering that we managed to organically grow by about 9.9% despite the absence of any major international sporting events in 2019,” remarked Michele Ciavarella, CEO of Newgioco Group. “Anticipated legislative challenges that are ongoing in the regulated Italian market continue to factor in our strategy to position from land-based betting shops to web-based operations. Legislative maneuvers in Italy are expected to further bar entry of foreign and unregulated operators into the Italian market and the operational tactics we are employing are generating key metrics that measures market adoption of our products and services that savvy sports bettors demand. This key data could be crucial to our competitive advantage as we seek to drive into the U.S. markets.”
“Our regulated market know-how could be instrumental as we plan to expand into new geographical regions and new markets,” continued Mr. Ciavarella. “Looking forward to 2020 we have our sights firmly focused on the US market and believe our state-of-the-art betting platform, that is built from the ground up specifically for each market, may be highly sought after by new partners. We also believe that we are well positioned to increase our market share in the U.S. having successfully completed our Nasdaq listing in December 2019.”
The Company’s full financial report can be found on EDGAR through the following link: Nasdaq:NWGI SEC Filings
About Newgioco Group, Inc.
Newgioco Group, Inc., is a global leisure gaming technology company, with fully licensed online and land-based gaming operations and innovative betting technology platforms that provide bet processing for casinos and other gaming operators. The Company conducts its business under the registered brand Newgioco primarily through its internet-based betting distribution network on its website, www.newgioco.it as well as in retail neighborhood betting shops throughout Italy.
Newgioco offers clients a full suite of leisure gaming products and services, such as sports betting, virtual sports, online casino, poker, bingo, interactive games and slots. Newgioco also owns and operates innovative betting platform software providing both B2B and B2C bet processing for casinos, sports betting and other online and land-based gaming operators. Additional information is available on our corporate website at www.newgiocogroup.com.
Investors may also find us on Facebook® and follow us on Twitter @NWGI_gaming.
