Gaming Realms recently saw an 18% year-on-year increase in their revenue for the first half of 2019. This growth has been attributed primarily to growth in their licensing division. Additionally, the mobile games developer was successful in cutting their pre-tax loss in the same period.
Total continuing revenue for the company from January to June this year amounted to £3.2 million, which is definitely a significant improvement from the £2.7 million they earned in the same period last year. Social activities used to be the developer’s main source of income, but that was overtaken by licensing in the first half of this year. Revenue from licensing skyrocketed to £1.6 million from £600,000. That is a 167% year-to-year increase!
The increase in revenue was boosted by 13 of the company’s partners going live in 2018 as well as the first half of 2019. Gaming Realms has also added several games to their content portfolio within the same period. Additionally, they signed a distribution agreement with Scientific Games, which also benefited the company.
“Our strategy to leverage our market-leading ‘Slingo Originals’ games library into the UK and international gaming markets continues to gain momentum,” Gaming Realms Chief Executive Patrick Southon said. “Licensing our content to leading brands and gaming operators is delivering high-margin revenues and the disposal of the RMG assets has given us greater resources to invest in content creation.”
In contrast to the growth in the company’s licensing revenue, their social revenue actually fell 29% from £2.1 million to £1.5 million. The company’s revenue from other sources amounted to £100,000. They noted that they are in the final stages of rationalising their social division.
In terms of spending, the company’s marketing costs were reduced from £194,862 to £113,220. However, their operating expenses increased a bit from £658,615 to £717,162. They also saw their administrative expenses rise from £2.2 million to £2.8 million. Gaming Realms’ adjusted earnings before interest, tax, depreciation, and amortisation (EBITDA) also fell from £195,462 to a £946,052, but the company attributed most of this to discontinued operations.
Another thing they attribute to losses from discontinued operations is the increase in their net loss for H1 of 2019. From £2.6 million, their net loss climb to £3.2 million this year. Still, higher revenue and lower spending has allowed the company to cut their loss before tax, bringing it down from £3.1 million to £2.5 million.
“We are currently performing in line with management’s forecasts and with new commercial developments in the pipeline, we are confident in meeting our full year objectives,” Southon said. Confirmation of the company’s H1 financial results comes after the company finalised the sale of its Bear Group subsidiary to River iGaming in July. The agreement for the sale was first announced in February, and it was worth a total consideration of £11.5 million. A mere month before this sale, the company also signed a gaming agreement with Relax Gaming.