- Revenue of €334.5 million up 7% period over period
- Adjusted EBITDA of €61.5 million up 14% period over period
- Loss after tax of €163.2 million includes €201.5 million of
costs and changes in fair values associated with the business
combination and listing as a public company
- Cash and cash equivalents increased 39% to €272.7 million at
March 31, 2022 from March 31, 2021
- Management to host conference call today at 8:30 a.m. ET
Super Group (SGHC) Limited (NYSE: SGHC) (“SGHC” or “Super
Group”), the parent company of Betway, a leading online sports
betting and gaming business, and Spin, the multi-brand online
casino, today announced first quarter 2022 financial results for
its operating subsidiary, SGHC Limited.
Super Group completed a business combination on January 27,
2022, with Sports Entertainment Acquisition Corp. (“SEAC”) as a
result of which all of the shareholders of SGHC Limited also
exchanged their shares for shares of Super Group in a pre-closing
reorganization. Prior to January 27, 2022, SGHC did not conduct any
operations other than incurring costs to effect the reorganization
and business combination.
Neal Menashe, CEO of Super Group, commented: “During the first
quarter of 2022, Super Group began operating as a U.S. publicly
listed company and continued to expand in both existing and new
markets in line with our growth strategy.” Mr. Menashe continued,
“Our team has become accustomed to navigating the business through
changing and challenging environments, and we believe the
strategies that we are executing on will enable us to continue
doing so as we take Super Group from strength to strength.”
Alinda van Wyk, CFO of Super Group commented, “The results for
the first quarter of 2022 reflected revenue growth and strong cash
generation but were challenged on a period over period comparative
basis due to industry and economic headwinds and costs related to
our business combination and listing as a public company in
January. Ms. van Wyk stated, “Despite tough period over period
comparisons, Super Group experienced revenue growth and a period
over period 39% increase in cash and cash equivalents.”
Financial Highlights
- Revenue increased 7% to €334.5 million for first quarter 2022
from €311.8 million in the same period from the prior year driven
by growth in African and Asia-Pacific markets partially offset by
adverse impacts from tightening regulation, and in some cases,
ceasing in some European markets. Revenue for the first quarter of
2021 was also impacted by continued shutdowns from the COVID
pandemic in many markets which resulted in increased gaming
activity.
- Loss after tax for the first quarter of 2022 was €163.2 million
compared to a profit of €38.6 million in the same period of the
prior year. Loss for the first quarter of 2022 included €201.5
million of costs and adjustments related to the business
combination and the listing on January 27, 2022, including €21.4
million of transaction costs incurred as well as €180.1 million of
non-cash costs and adjustments as follows:
- €126.3 million for share listing expense;
- €29.4 million for a fair value adjustment of warrant
liabilities; and
- €24.4 million for a fair value adjustment of earn out
liabilities.
The transaction fees and share listing
expense are one-time costs.
- EBITDA, a non-GAAP measure, decreased to a loss of €138.2
million in the first quarter of 2022 compared to earnings of €64.1
million in the same period from the prior year.
- Adjusted EBITDA, which excludes transaction costs, share
listing expense, changes in valuations of warrants and earn-out
liabilities, gains on derivative contracts and bargain purchases,
increased 14% to €61.5 million compared to €54.0 million in the
same period from the prior year.
- Monthly Average Customers for the quarter increased 10% to 2.6
million during the first quarter of 2022 from 2.4 million in the
first quarter of 2021 despite closure and restrictions in certain
European countries and the first quarter of 2021 benefiting from a
resurgence of the COVID pandemic.
- Cash and cash equivalents was €272.7 million at March 31, 2022
and €293.8 million at December 31, 2021. The decrease was primarily
the result of cash used to redeem shares in connection with closing
the business combination, offset in part by cash released from
SEAC’s trust account to Super Group upon the closing. Cash and cash
equivalents increased 40% to €272.7 million at March 31, 2022 from
€196.2 million at March 31, 2021.
Business Highlights
- During the first quarter of 2022, Super Group increased its
regulated market presence through the launch of both a sports
betting and casino offering in Bulgaria.
- Nine new partnerships were signed during the first quarter of
2022, including the Milwaukee Bucks, the Stock Car Pro Series
Brazil and the Ghana Women’s Football League.
- As of March 31, 2022, Super Group had over 70 brand
partnerships in over 20 jurisdictions.
- In Ontario, registration has been awarded for the Betway brand,
and SGHC anticipates imminent registration for the Spin brands.
Currently, Betway and Spin continue to operate in Ontario with the
knowledge of the regulator.
Geographical Information for the Three
Months Ended March 31
2022
2022
2022
Betway
Spin
Total
€ '000s
€ '000s
€ '000s
Africa and Middle East
63,786
1,337
65,123
Asia and Pacific
55,250
23,989
79,239
Europe
30,192
2,525
32,717
North America
34,467
115,984
150,451
South/Latin America
3,285
3,663
6,948
186,980
147,498
334,478
%
%
%
Africa and Middle East
34%
1%
19%
Asia and Pacific
30%
16%
24%
Europe
16%
2%
10%
North America
18%
79%
45%
South/Latin America
2%
2%
2%
2021
2021
2021
Betway
Spin
Total
€ '000s
€ '000s
€ '000s
Africa and Middle East
40,624
1,591
42,215
Asia and Pacific
40,592
27,352
67,944
Europe
37,771
8,697
46,468
North America
34,036
114,661
148,697
South/Latin America
2,811
3,676
6,487
155,834
155,977
311,811
%
%
%
Africa and Middle East
26%
1%
14%
Asia and Pacific
26%
18%
22%
Europe
24%
6%
15%
North America
22%
73%
47%
South/Latin America
2%
2%
2%
Disaggregation of Revenue by Product
Line
For the Three Months ended March
31, 2022:
Betway
Spin
Total
€ '000s
€ '000s
€ '000s
Online casino
57,456
147,046
204,502
Sports betting
109,037
452
109,489
Brand licensing
19,890
‐
19,890
Other
597
‐
597
Total Group revenue
186,980
147,498
334,478
For the Three Months ended March
31, 2021:
Betway
Spin
Total
€ '000s
€ '000s
€ '000s
Online casino
55,566
154,913
210,479
Sports betting
82,905
1,064
83,969
Brand licensing
17,363
‐
17,363
Total Group revenue
155,834
155,977
311,811
Reorganization Timeline
Over the last three years, the business conducted a
restructuring by combining existing, stand-alone companies into the
newly formed Super Group. The only acquisition affecting the
periods presented in this press release is Raging River, acquired
on January 11, 2021.
SGHC Limited was formed on July 6, 2020.
The following transactions took place during 2019, 2020, 2021
and 2022 as part of the reorganization:
- Pindus is the predecessor entity, and its results are reflected
in the financial statements prior to July 31, 2019.
- July 26, 2019 - Fengari was deemed to have been acquired.
- April 1, 2020 - Pelion was deemed to have been acquired.
- May 4, 2020 - Pelion acquired Lanester.
- September 30, 2020 - Yakira and Gazelle were both
acquired.
- January 11, 2021 - Raging River was deemed to have been
acquired.
- April 9, 2021 - Webhost, Partner Media and Buffalo were
acquired.
- April 14, 2021 - DigiProc Consolidated was acquired.
- April 19, 2021 - Raichu Investments was acquired.
- September 2, 2021 - SGHC purchased 100% of the outstanding
shares of Smart Business Solutions S.A.
- December 1, 2021 - SGHC purchased 100% of the outstanding
shares in Haber Investments, and Red Interactive.
- January 27, 2022 - Business combination with SEAC.
Non-GAAP Financial Information
This press release includes non-GAAP financial information not
presented in accordance with the International Financial Reporting
Standards (“IFRS”).
EBITDA and Adjusted EBITDA are non-GAAP company-specific
performance measures that Super Group uses to supplement the
Company’s results presented in accordance with IFRS. EBITDA is
defined as profit before depreciation, amortization, financial
income, financial expense and income tax expense/credit. Adjusted
EBITDA is defined as EBITDA less gain on derivative contracts and
gain on bargain purchase plus transaction costs, share listing
expense and fair value adjustments on warrant liabilities and
earnout liabilities.
Super Group believes that these non-GAAP measures are useful in
evaluating the Company’s operating performance as they are similar
to measures reported by the Company’s public competitors and are
regularly used by securities analysts, institutional investors and
other interested parties in analyzing operating performance and
prospects.
Management does not consider these non-GAAP measures in
isolation or as an alternative to financial measures determined in
accordance with IFRS. The principal limitation of these non-GAAP
financial measures is that they exclude significant expenses that
are required by IFRS to be recorded in Super Group’s financial
statements. In order to compensate for these limitations,
management presents non-GAAP financial measures together with IFRS
results. Non-GAAP measures should be considered in addition to
results and guidance prepared in accordance with IFRS, but should
not be considered a substitute for, or superior to, IFRS
results.
Reconciliation tables of the most comparable IFRS financial
measure to the non-GAAP financial measures used in this press
release are included below. Super Group urges investors to review
the reconciliation and not to rely on any single financial measure
to evaluate its business. In addition, other companies, including
companies in our industry, may calculate similarly named non-GAAP
measures differently than we do, which limits their usefulness in
comparing our financial results with theirs.
Reconciliation of Profit to Adjusted
EBITDA for the Three Months Ended March 31:
2022
2021
€ '000s
€ '000s
Profit (Loss) for the
period
(163,222
)
38,571
Income tax expense
8,959
2,920
Finance income
(313
)
(338
)
Finance expense
349
2,879
Depreciation and amortization
expense
15,990
20,022
EBITDA
(138,237
)
64,054
Transaction costs
21,405
‐
Gain on derivative contracts
(1,712
)
‐
Share listing expense
126,252
‐
Fair value ‐ warrant
liability
29,374
‐
Fair value ‐ earnout
liability
24,385
‐
Gain on bargain purchase
‐
(10,047
)
Adjusted EBITDA
61,467
54,007
Webcast Details
The Company will host a webcast at 8:30 a.m. ET today to discuss
the first quarter 2022 financial results. For ease of
year-over-year comparison and analysis the Company may discuss
pro-forma consolidated results, including Adjusted EBITDA, which
pro-forma results are included in the 2022 Earnings Review
presentation posted on Investor Relations section of SGHC.com.
Participants may access the live webcast and supplemental
earnings presentation on the events & presentations page of the
Super Group Investor Relations website at:
https://investors.sghc.com/events-and-presentations/default.aspx.
About Super Group (SGHC) Limited
Super Group (SGHC) Limited is the holding company for leading
global online sports betting and gaming businesses: Betway, a
premier online sports betting brand, and Spin, a multi-brand online
casino offering. The group is licensed in multiple jurisdictions,
with leading positions in key markets throughout Europe, the
Americas and Africa. The group’s sports betting and online gaming
offerings are underpinned by its scale and leading technology,
enabling fast and effective entry into new markets. Its proprietary
marketing and data analytics engine empowers it to responsibly
provide a unique and personalized customer experience. For more
information, visit www.sghc.com.
Forward-Looking Statements
Certain statements made in this press release are “forward
looking statements” within the meaning of the “safe harbor”
provisions of the United States Private Securities Litigation
Reform Act of 1995.
These forward-looking statements include, but are not limited
to, expectations and timing related to market entries and
expansion, projections of market opportunity and growth, expected
growth of Super Group’s customer base, expansion into new markets
and receipt of regulatory approvals.
These forward-looking statements generally are identified by the
words “believe,” “project,” “expect,” “anticipate,” “estimate,”
“intend,” “strategy,” “future,” “opportunity,” “plan,” “pipeline,”
“may,” “should,” “will,” “would,” “will be,” “will continue,” “will
likely result,” and similar expressions. Forward-looking statements
are predictions, projections and other statements about future
events that are based on current expectations and assumptions and,
as a result, are subject to risks and uncertainties. Many factors
could cause actual future events to differ materially from the
forward-looking statements in this press release, including but not
limited to: (i) the ability to implement business plans, forecasts
and other expectations, and identify and realize additional
opportunities; (ii) the ability to maintain the listing of Super
Group’s securities on a national securities exchange; (iii) changes
in the competitive and regulated industries in which Super Group
operates; (iv) variations in operating performance across
competitors; (v) changes in laws and regulations affecting Super
Group’s business; (vi) Super Group’s inability to meet or exceed
its financial projections; (vii) changes in general economic
conditions, including as a result of the COVID-19 pandemic; (viii)
changes in domestic and foreign business, market, financial,
political and legal conditions; (ix) future global, regional or
local economic and market conditions affecting the sports betting
and gaming industry; (x) changes in existing laws and regulations,
or their interpretation or enforcement, or the regulatory climate
with respect to the sports betting and gaming industry; (xi) the
ability of Super Group’s customers to deposit funds in order to
participate in Super Group’s gaming products; (xii) compliance with
regulatory requirements in a particular regulated jurisdiction, or
Super Group’s ability to successfully obtain a license or permit
applied for in a particular regulated jurisdiction, or maintain,
renew or expand existing licenses; (xiii) the technological
solutions Super Group has in place to block customers in certain
jurisdictions, including jurisdictions where Super Group’s business
is illegal, or which are sanctioned by countries in which Super
Group operates from accessing its offerings; (xiv) Super Group’s
ability to restrict and manage betting limits at the individual
customer level based on individual customer profiles and risk level
to the enterprise; (xv) the ability by Super Group’s key
executives, certain employees or other individuals related to the
business, including significant shareholders, to obtain the
necessary licenses or comply with individual regulatory obligations
in certain jurisdictions; (xvi) protection or enforcement of Super
Group’s intellectual property rights, the confidentiality of its
trade secrets and confidential information, or the costs involved
in protecting or enforcing Super Group’s intellectual property
rights and confidential information; (xvii) compliance with
applicable data protection and privacy laws in Super Group’s
collection, storage and use, including sharing and international
transfers, of personal data; (xviii) failures, errors, defects or
disruptions in Super Group’s information technology and other
systems and platforms; (xix) Super Group’s ability to develop new
products, services, and solutions, bring them to market in a timely
manner, and make enhancements to its platform; (xx) Super Group’s
ability to maintain and grow its market share, including its
ability to enter new markets and acquire and retain paying
customers; (xxi) the success, including win or hold rates, of
existing and future online betting and gaming products; (xxii)
competition within the broader entertainment industry; (xxiii)
Super Group’s reliance on strategic relationships with land based
casinos, sports teams, event planners, local licensing partners and
advertisers; (xxiv) events or media coverage relating to, or the
popularity of, online betting and gaming industry; (xxv) trading,
liability management and pricing risk related to Super Group’s
participation in the sports betting and gaming industry; (xxvi)
accessibility to the services of banks, credit card issuers and
payment processing services providers due to the nature of Super
Group’s business; (xxvii) the regulatory approvals related to Super
Group’s acquisition of DGC; (xxviii) the integration of the DGC
business; and (xxix) other risks and uncertainties indicated from
time to time for Super Group including those under the heading
“Risk Factors” in our Annual Report on Form 20-F filed with the SEC
on April 20, 2022, and in Super Group’s other filings with the SEC.
The foregoing list of factors is not exhaustive. You should
carefully consider the foregoing factors and the other risks and
uncertainties described in other documents filed or that may be
filed by Super Group from time to time with the SEC. These filings
identify and address other important risks and uncertainties that
could cause actual events and results to differ materially from
those contained in the forward-looking statements. Forward-looking
statements speak only as of the date they are made. Readers are
cautioned not to put undue reliance on forward-looking statements,
and Super Group assumes no obligation and does not intend to update
or revise these forward-looking statements, whether as a result of
new information, future events, or otherwise. Super Group does not
give any assurance that it will achieve its expectations.
SGHC Limited
Unaudited Interim Condensed
Consolidated Statements of Profit or Loss
and Other Comprehensive
Income
for the three months ended
March 31, 2022 and 2021
2022
2021
€ '000s
€ '000s
Revenue
334,478
311,811
Direct and marketing expenses
(240,717
)
(214,449
)
Other operating income
2,407
263
General and administration
expenses
(34,701
)
(43,618
)
Depreciation and amortization
expense
(15,990
)
(20,022
)
Transaction fees
(21,405
)
‐
Profit from operations
24,072
33,985
Finance income
313
338
Finance expense
(349
)
(2,879
)
Gain on derivative contracts
1,712
‐
Share listing expense
(126,252
)
‐
Change in fair value of warrant
liability
(29,374
)
‐
Change in fair value of earnout
liability
(24,385
)
‐
Gain on bargain purchase
‐
10,047
(Loss)/profit before
taxation
(154,263
)
41,491
Income tax expense
(8,959
)
(2,920
)
(Loss)/profit for the period
attributable to owners of the parent
(163,222
)
38,571
Other comprehensive
income
Items that may be reclassified
subsequently to profit or loss
Foreign currency translation
1,117
526
Other comprehensive income for
the period
1,117
526
Total comprehensive
(loss)/profit for the period attributable to owners of the
parent
(162,105
)
39,097
Weighted average shares
outstanding, basic and diluted
488,324,769
460,395,838
(Loss)/Net profit per share,
basic and diluted
(0.33
)
0.08
SGHC Limited
Unaudited Interim Condensed
Consolidated Statements of Financial Position
as at March 31, 2022 and
December 31, 2021
2022
2021
ASSETS
€ '000s
€ '000s
Non‐current assets
Intangible assets
165,904
172,954
Goodwill
25,003
25,023
Property, plant and equipment
13,707
12,498
Right‐of‐use assets
13,887
14,541
Deferred tax assets
29,422
24,108
Regulatory deposits
8,980
8,594
Loans receivable
7,500
25,516
Financial assets
1,686
1,686
266,089
284,920
Current assets
Trade and other receivables
167,154
169,252
Income tax receivables
33,923
35,806
Restricted cash
88,231
60,296
Cash and cash equivalents
272,684
293,798
561,992
559,152
TOTAL ASSETS
828,081
844,072
Non‐current
liabilities
Lease liabilities
10,938
10,896
Deferred tax liability
9,634
9,248
Interest‐bearing loans and
borrowings
532
764
21,104
20,908
Current liabilities
Earnout liability
274,340
‐
Warrant liability
76,489
‐
Lease liabilities
4,807
5,353
Deferred consideration
‐
13,200
Shareholders’ repurchase
payable
44,311
‐
Interest‐bearing loans and
borrowings
3,294
3,008
Trade and other payables
150,561
147,353
Customer liabilities
52,883
51,959
Provisions
47,920
47,715
Income tax payables
47,708
40,524
702,313
309,112
TOTAL LIABILITIES
723,417
330,020
EQUITY
Issued capital
273,436
269,338
Earnout reserve
(249,955
)
‐
Foreign exchange reserve
(977
)
(2,094
)
Retained profit
82,160
246,808
TOTAL EQUITY
104,664
514,052
TOTAL LIABILITIES AND
SHARHOLDERS' EQUITY
828,081
844,072
SGHC Limited
Unaudited Interim Condensed
Consolidated Statements of Cash Flows
for the three months ended
March 31, 2022 and 2021
2022
2021
€ '000s
€ '000s
Cash flows from operating
activities
(Loss)/profit for the period
(163,222
)
38,571
Add back:
Income tax expense
8,959
2,920
Loss on disposal of assets
‐
(7
)
Fair value ‐ warrant
liability
29,374
‐
Fair value ‐ earnout
liability
24,385
‐
Share listing expense
126,252
‐
Depreciation of property, plant
and equipment
1,323
587
Waiver of loans
‐
462
Gain on bargain purchase
‐
(10,047
)
Amortization of right‐of‐use
assets
1,162
542
Amortization of intangible
assets
13,505
18,893
Increase in provisions
387
255
Finance income
(313
)
(338
)
Finance expense
242
2,770
Unrealized foreign currency
(loss)/gain
(1,688
)
2,483
Changes in working
capital:
Decrease in trade and other
receivables
2,289
19,161
Decrease in trade and other
payables
(20,128
)
(17,083
)
Increase in customer
liabilities
924
6,302
Change in restricted cash
(731
)
(1,169
)
Cash from operating
activities
22,720
64,302
Dividends tax paid
(5,461
)
(154
)
Corporation tax rebates
received
1,846
2,387
Corporation tax paid
(1,422
)
(3,292
)
Net cash flows from operating
activities
17,683
63,243
Cash flows from investing
activities
Cash received in interest
237
200
Acquisition of intangible
assets
(6,252
)
(3,628
)
Acquisition of property, plant
and equipment
(2,533
)
(524
)
Acquisition of businesses, net of
cash acquired
-
10,301
Restricted cash guarantee
(27,204
)
‐
Receipts from loans
receivable
17,541
1,041
Issuance of loans receivable
(6
)
(25
)
Cash used in regulatory
deposits
(386
)
(463
)
Net cash flows from investing
activities
(18,603
)
6,902
Cash flows used in financing
activities
Shares repurchased
(179,985
)
(10,733
)
Capitalized transaction fees
(1,488
)
-
Proceeds from shares issued
172,119
-
Cash paid for deferred
consideration
(13,200
)
‐
Repayment of interest‐bearing
loans and borrowings
(349
)
(1,932
)
Repayment of lease liabilities ‐
interest
(261
)
(352
)
Repayment of lease liabilities ‐
principal
(1,186
)
(1,027
)
Net cash flows used in
financing activities
(24,350
)
(14,044
)
(Decrease)/increase in cash
and cash equivalents
(25,270
)
56,101
Cash and cash equivalents at
beginning of the period
293,798
138,540
Effects of exchange rate
fluctuations on cash held
4,156
1,553
Cash and cash equivalents at
end of the period
272,684
196,194
.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220524005945/en/
Investors: investors@sghc.com
Media: media@sghc.com
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