Good morning and welcome to the Gaming Realms Full Year Results Investor presentation. Throughout this recorded presentation, investors will be in listen-only mode. Questions are encouraged, and they can be submitted at any time using the Q&A tab situated on the right-hand corner of your screen. Simply type in your questions and press send. The company may not be in a position to answer every question received during the meeting itself. However, the company can review all questions submitted today and publish responses where it is appropriate to do so. Before we begin, I would like to submit the following poll, and I would now like to hand you over to CEO Mark Segal. Good morning to you.
Good morning, everyone. Thank you for being here today. I'm Mark, CEO of Gaming Realms, and I'm pleased to present our financial results for the full year of 2024. The past year has been another record one for the company. We've had strong revenue growth and EBITDA growth, as well as further cash generation. We're actually really proud of what we've achieved as a team. Today's presentation, I think, is going to be similar to previous ones we've done, where we'll run through the business model, walk through key financial metrics, and highlight the drivers of our performance and also the opportunities we have in the future. You have myself, CEO, and Geoff joining as CFO. We have a strong management team, all very experienced in the industry that we're in.
They've worked for other sort of similar businesses before and all worked very, you know, in all the areas that we've been needing as a team. What do we do? We are a developer and licensor of casino games for the regulated international gaming market. Our core business is, this is the core business of what we're doing, and it's very much based around the Slingo IP that we acquired in 2015. This is a unique product and a very strong brand, which allows us to have a cut-through with the operators we work with and also the game formats. Incredibly engaging and popular with players. Slingo itself, as I say, is a strong brand, and as such, we're able to license this to adjacent markets we're in.
We license Slingo to, you know, for example, in the lottery world and in the U.S., they print tens of millions of lottery tickets each year, which are branded Slingo. We also have a couple of other deals with iLottery products and also in the social space with Zynga. We also operate a smaller social gaming Slingo-based product called Slingo Arcade. This is a freemium model, really a bit more like Candy Crush, where you can pay for play and you can also, we get some advertising revenue. It is really a way that we can monetize the games that we're making in the real money space into the social. Underpinning all of this is our proprietary platform. We have, you know, almost 90 games that we publish through the platform, our own Slingo games.
We have some other types of games on the platform that we've developed, as well as taking third-party studios, which we're publishing to our partners. The value is created for us, you know, across our different sort of verticals that we're in, our businesses we're in. In the core licensing business where we're developing the games, it's actually we share in the operator success. The more popular our games are and the more they're played, we earn a revenue share off that. This is a very diverse revenue stream for us now. We have over 200 partners live. We have close to 90 games live as well, which means that our revenues are spread well across all of these, and they will continue to grow as we build more really popular games and go live with more operators.
The brand licensing side is generally on a revenue share basis as well, although the revenues that we see coming in are a little more volatile in the sense that we often get advances on our brand deals, in which case they may get accounted slightly more lumpy in financial periods. This is really nice. It allows us to be in different markets and essentially have the Slingo brand out there. Social gaming, as I said, is more of a freemium-based model where you pay for, you know, further play and there's advertising revenue there. Slingo, not only are they great games that we're producing, which are very popular with players, but they are category defining. Slingo is a mixture of slots and bingo.
It is essentially found or the operators are promoting these games alongside bingo and slots and jackpots or whatever else they may have on their site. We have given a few examples here in North America. We could find examples in almost every market we are in. For example, here is Caesars. Above all the game images you can see, you can see there is a Slingo section on their site. This allows us to have quite valuable real estate on mobile phones where our games are found. The reason they are there is because Slingo is this very, very popular format now. I can show you the same here with BetMGM. These are two, both of them Caesars and BetMGM, big US operators. They also have a Slingo section. We have also just taken an example from one of the lotteries we work with in Canada, Loto-Québec.
You can see those six titles there, of which Slingo is highlighted. Each time you click in these sections, you'll find our portfolio is promoted. I won't spend a lot of time here, but we are, you know, we have a great reputation in the market and we're working with the biggest sort of operators that there are in each market we're in. We're also growing. We are now in 21 regulated markets, having just launched in Brazil. We've got a number of markets in the sort of lighter blue colors here, which we are hoping to go into or launch into this year, as well as growing in our existing markets. We are really well spread now. You know, we are a big international game supplier. Just moving on to the financial results, hand over to Geoff.
Thanks. I'm going to take you through some slides looking at our financial performance in 2024 and then look to go into a bit more detail on where the growth has come from, both at a market level and also from a new partner versus organic growth perspective. This first slide here, this is a snapshot of some of our key metrics in 2024. I won't go through every single one of these tiles, but some of the ones which I would pull out would be, it was another record year, both in revenue and adjusted EBITDA terms. Our revenue was up 22% to GBP 28.5 million, and adjusted EBITDA grew to GBP 13.1 million. That was up 30% year- on- year. That really shows the operational leverage the model has.
As you'll have seen, no doubt earlier in the week with our announcement, this growth has really been propelled by our performance in North America. The bottom two tiles on the left-hand side. Our content licensing revenues in the US grew 57% over 2023 and 71% in Canada. We're live in 21 regulated markets now. As Mark just mentioned, we went live in Brazil a couple of months ago, and we expect to go live in British Columbia any day now. That 21 will tick over to 22 very shortly. The middle tile on the right-hand side, we have 5.7 million unique players playing our content in 2024, which was 22% ahead of the previous year. Finally, all this momentum has continued into 2025. Our content licensing revenues in January and February of this year were 22% ahead of the same period last year.
That's a snapshot. This next slide I'm going to turn to, this is our summary income statement for 2024 against 2023. Again, I won't go through every single line here, but some of the key items I'd pull out would be headline revenue growing 22%, which was really driven by our core content licensing business growing 28% in year. Variable costs or operating expenses, as they are in financial statements, they remain a relatively low level. They represent 21% of revenue, which is the same level they were last year. That's really revenue-linked costs like brand license fees, hosting costs. That they've moved in line with revenue is to be expected. Our admin expenses increased 14%.
Almost two-thirds of that growth is headcount-driven, as we invested in our team over the past year to deal with operating in more markets with more partners, launching more games and diversified content. We talk operational leverage a lot. I guess you can see that at the bottom of this slide with adjusted EBITDA increasing 30%, EBITDA up 33%, and profit before tax up 61%, all well ahead of headline revenue growth. This next slide is quite a simple slide. It is trying to summarize our operational model. It is saying, as we launch with more operators in more markets and we develop, distribute, and launch more games, the engagement on our game portfolio increases, more game play, there are more bets placed, and ultimately that feeds into revenue or increases in revenue for the business. That is much better demonstrated visually on this next slide.
This is a slide we really like showing. It shows our progress made over each half-year period going all the way back to 2017. The top two charts here are both on a cumulative basis, so the number of operators and the number of games. At the end of 2024, we were live with 87 games, and we were live with around 225 partners. The bottom two charts are both in-period metrics, so the value of bets placed in the period and the revenue generated. Again, if you add up the two bars in 2024 in the bets placed, there was almost GBP 6.4 billion worth of bets placed through the platform on our games last year, which I guess really highlights the scale and capability that the platform holds for us.
Yeah, the message from the last two slides is, as we launch more operators, more games, the bets placed increases, and all of that ultimately feeds into the bottom right chart with revenues increasing. Now the next couple of slides I'm going to talk through are looking at our revenue growth in particular and looking at it from a couple of different angles. This first one is at a market level. This is showing our revenue generated in seven of our key markets plus the rest of the world bucket on the right-hand side. The great thing about this is we're continuing to grow in all of our key markets. Looking at a couple of these in a bit more detail, the US on the far left-hand side, this is our largest market now. Revenues grew 57% over 2023.
That came from a number of areas. We launched in West Virginia in August, which is the fifth regulated iGaming state that we distribute to. All of the states that we distribute to, our revenues grew really nicely against 2023. I guess Michigan would probably be the one I'd pull out as a standout where revenues doubled in 2024 over the previous year. Even better, all of that growth came organically. In that market in total, 70% of that growth came organically from partners that we were already live with. 30%, sorry, came from the 15 partners that we launched with in year. As we look further ahead, we're starting the process to get a license in Delaware. The markets we're already in are growing, and we're really, really well placed as new markets and states regulate for iGaming hopefully in the future.
Moving to the right, the U.K., this is by far the most mature iGaming market that we're in, but we did still see growth here. We only went live with a couple of small operators with a U.K. presence, so that change really has come organically. Moving along again, Canada. This is a market which continues to grow really nicely for us, up 71% over 2023. We only went live with a handful of partners in that market, and 95% of that growth has come organically. As we've mentioned, we expect to go live in British Columbia any day now. We have Alberta on the horizon, which is a province regulating in a commercial way like Ontario. I think we expect Canada to really show strong growth looking forwards. Then onto some of our smaller markets, Italy.
Italy grew 4% again, which was all virtually organic. We went live with just one partner during the year. We launched our first Italy-first game last year, at the back end of November. It did not have a huge impact on the 2024 numbers, but we licensed a top Italian slot brand called Fowl Play and built a game around, or a Slingo game around that IP, distributed it globally, but it was an Italy-first title. I guess just to give you a flavor of what that has done, in the three months after we launched that game, the revenues in Italy are 25% ahead of where they were coming into 2024. I would not propose to talk too much about Spain and Portugal. They are both very much earlier in their growth cycle with us, but they continue to grow really nicely, 32% and 138%.
At a market level, this next slide is a relatively simple chart, but it's quite interesting nonetheless. It's showing the type of partner that our growth has come from. What this is doing, it's bridging our content licensing revenues in 2023 of GBP 18.5 million up to the GBP 23.8 million generated in 2024. When we say organic partner here, this is growth with partners that we were already live with before the 1st of January 2024. There are two key messages from this chart really. The first one is that 70% of our growth in 2024 has come organically from partners that we were already live with. The second is that we've still managed to layer on top GBP 1.5 million of revenue from the new partners that we went live with during the year.
That becomes important as we move on to this next slide, showing the compound effect of what happens when we go live with a batch of operators. This is looking at what happens when we go live with a cohort of operators in any year. I should say the scaling on this, this is showing the gross revenues that the operators generate from our games in any year. The 2024 stack chart comes to almost GBP 330 million of gross revenue. Each of the colors within the chart represent a different cohort year of operators. For example, in 2021, we went live with a batch of operators which generated GBP 18 million of gross revenue from our games that year. They then went on to subsequently generate GBP 62 million in 2022, GBP 73 million in 2023, and GBP 93 million last year.
The message here is really that we don't go live with an operator or a cohort of operators, launch our entire portfolio with them on day one, and then see that dwindle down. We launch with a selection of games. We then get to know the operator a lot better, deepen our ties with them, understand their play base, how they interact and can interact with our games, and then methodically launch content with them over future periods to really organically grow and maximize the value of that relationship. Yeah, the last two slides is kind of two messages. We grow in two ways. We layer on new partners on top of existing, and then we also grow organically with the partners that we're already live with. This last chart I want to talk through, this is just a look at our cash.
It shows essentially the bridge from how you get from profit before tax of GBP 8.3 million on the left-hand side over to our increase in free cash flow of GBP 6.1 million on the right-hand side. Our closing cash balance at the end of 2024 was GBP 13.5 million, which was a GBP 6.1 million increase over 2023. The bridging steps to get you between the two, you add back the GBP 4.3 million of combined depreciation and amortization, the GBP 0.8 million of share option charges, both of those buckets are non-cash charges to the income statement. Going the other direction, we made GBP 0.9 million of corporation tax payments in the US. We capitalized GBP 5.8 million of development spend, predominantly within intangible assets. There was a GBP 0.7 million increase in working capital, which was largely receivables driven. I'll pass you back to Mark.
Sort of the future and where we're going. I mean, this slide here is showing the growth we've been seeing in North America. It's the U.S. and Canada. We've been growing at scale. We're able to grow with our existing partners as we are launching new exciting content. Today, this has been very Slingo-led, although we are now starting to distribute some slots into the market from third-party studios. We're looking at new innovative games that we can be taking to market ourselves as the pipelines open with these operators. We are a good leading supplier for most of them now as well. We're able to take more content, and hopefully we'll see the growth continue on. This is some research and forecast of where the U.S. market can be going, showing 92% forecast growth.
The good news is that this is really good news for us over the next four years. The markets we're in are growing organically, and so we're able to grow in these markets. The really big opportunity for us and for the industry in the U.S. is that regulation will open new states. There are over 30 states which have regulated online sports betting now. There are seven for the iGaming markets. There are a number of states which are looking to go through legislation at various stages. I don't know when they will pass, but I always think it will happen. It's a when rather than an if. The lighter shade here is the base case. This is assuming the organic growth in the markets, plus adding two more states, one I think in the back end of 2026 and another back end of 2027.
The more optimistic case is adding another four on top of that, two in 2026 and two more in 2027. Where we stand is, look, we know Slingo is very popular already in the U.S. market, not only in the content we're providing, but also in the licensing deals we're doing. The luxury space, the social space. We think there's opportunity for Slingo to grow into other markets as well in the U.S. or other product verticals. We're experienced at obtaining licenses, and we're also experienced at having our game and tech certified in the various markets. We're already working with the majority of the operators in the market. We have the integration routes. There's a lot to be optimistic about in this market.
On top of that, we are now bringing in different types of content as well to layer on top of Slingo or to innovate Slingo further and hopefully drive more players to our games and more revenues. Moving on to a couple of slides at the end. This is showing how we're growing in the respective markets in the US. Again, this is a snapshot to show as new markets open, we will layer on top and continue our growth. In the meantime, we've been growing in these markets already. A little bit at the end is what we've been doing with Slingo. I should probably start, which is not shown here, Slingo is an amazing format and brand where we're able to license IP into Slingo. We've been licensing TV shows.
We launched last year a Slingo Press Your Luck game, Press Your Luck being a popular game show in the US. We have also licensed game shows here like Deal or No Deal. We are also working with competitor studios for either land-based or online slot games and license them into our Slingo format as well, which has been working well for both parties, essentially. That allows more players to play both the Slingo games, but it is also for the slot IP owners as well. On top of that, we do a number of more bespoke games for various operators, whether it is the sports brands, which are highlighted here, or operator-branded games, for example, FanDuel Slingo, which launched last year, or the Paddy Power Lucky Pants Slingo. We do this for a number of our partners, which allows the partners to have got something more unique they are working with.
It's great for us to be working closer with them. We also will look to do, as Geoff mentioned, more market-specific branding. Some of the IP we license in is more specific for a license. We've done that more recently with Italy. There are always themes that we're looking for in various markets as well to try and have the most engaging games for our users. This is another area where we can start essentially growing and doing a lot more sort of work with our players, more opportunity for us. I don't know this particularly. The balance sheet, I mean, it's out there. It's in a lot of our financial numbers.
There's not too many things I'd pick out here. I think the cash is the obvious one to highlight, increasing from GBP 7.5 million to GBP 13.5 million last year.
Overall net assets are up GBP 9.6 million, which shows the strength of the business and the balance sheet. The non-current assets increase in GBP 3 million. That's a function of our investment in the games, the platform, and what we want to distribute.
Great. That is it for us in terms of the presentation.
That's great, Mark. Geoff, if I may just jump in there, and thank you very much indeed for your presentation. Ladies and gentlemen, please do continue to submit your questions using the Q&A tab situated on the top right corner of your screen. While the company takes a few moments to review those questions submitted today, I would like to remind you that a recording of this presentation, along with a copy of the slides and the published Q&A, can be accessed via our Investor dashboard.
Mark, Geoff, as you can see, we have received a number of questions throughout today's presentation. If I may now hand back to you and kindly ask you to read out the questions where appropriate to do so, and I'll pick up from you both at the end. Thank you.
All right. Thank you very much. Question one is, what jurisdictions do you see the most growth potential for in 2025? The answer to that is I still think the US will continue to grow as we launch more great content in the market. I'm not sure we mentioned before, but our 2024 set of games was the highest grossing set of games we produced in the first year. We are still continuing to make great games, and we're definitely seeing that in our results.
The US is still a growing market, but definitely in the long term, it's got the potential to be growing as more states regulate that. Next question is, would you consider diversifying away from the Slingo name and brand? Look, at the moment, I still think Slingo is our differentiator. It still has a much higher ceiling than we are utilizing the brand for. We're seeing that as we're able to see the results of how it does in areas where we're licensing the brand. So it's a very popular format with the players, and it's category defining. However, we'll continue to innovate within Slingo, as well as look for new additional products we can take to market. We are distributing some slot games now. There is demand, of course, for different types of games.
It will be interesting to see how we can take Slingo into some other categories of games. Hopefully, we'll see the crossover from that. I mean, just for example, we're seeing with some operators now how well they are able to use Slingo to cross-sell from other products, whether it's sports or bingo, for example. Slingo is a nice way to bring people into their casino offering. The next one is, what's the rationale behind a share buyback? Look, we've sat down as a board. We've decided at this point in time, with the surplus cash we have, this is probably the best use of this amount of money. We still have more surplus cash, and the business still continues to generate cash. We want to be able to have some cash on hand. It allows us to be nimble.
We're looking to invest more into the company. That's whether it be additional games, quicker launches, quicker market access, or more platform features to allow us to essentially allow more ability for our games to be marketed in all the various markets and territories we're in. It may also allow us, and I'm not saying we're in the process or anything like that, but it allows us to be nimble if we see some really interesting content that we may want to acquire, invest in, nurture. I think that's an area where we can put the money to use in a really good way to essentially add shareholder value. Another one is, is there much growth left in the U.K., and do you envisage more regulation coming? Look, the regulation's coming now. stake limits will be in next week. There's already been a lot of regulation today.
We think we're very well prepared. Our games are relatively lower staking in average. So we feel we have a good portfolio for the U.K. We've been doing a lot of innovation within our games to allow them to still be just as engaging afterwards. We'll have to wait to see. I mean, the great thing I would say about our business is, and I've seen in previous slides, we are well diversified. I mean, the U.S. is the largest market. So we're not fully reliant on the U.K., of course. It's our home market, and we've put a lot of effort into it. We'll continue to grow new markets. It could be interesting over the next couple of years to see how South Africa's done, how we're growing in Canada, how we're growing in Brazil as well, and other markets we're in.
We are trying to be as diversified as possible. Anything else?
Yeah, we've had one on our capitalization levels and what we should expect these to be looking forwards into 2025 and beyond. I think I said earlier in the presentation, we increased our headcount 24% in 2024 over 2023. That was to get us to a level to be able to distribute the content flow that we're now seeing that we will see in 2025. I think we were up to just north of 100 employees at the end of 2024. I think we expect, or we are expecting, a handful of increases this year, but nowhere near the increase we saw last year.
I think ultimately that will mean the capitalization will increase over 2024, just purely because of the full-year impact of that increase in headcount, which was predominantly in our product teams and tech teams. We are probably looking around the GBP 6 million level rather than the same sort of growth that we saw last year.
I do not know if there are any others you want to go, or should I go?
No, go for it.
Fine. Next question. How many more regulated markets operators can the current headcount sustain? Looking to gain an idea of your current spare capacity. It is probably worth saying we have grown headcount 20% or 20-odd % over 2024. We are not going to continue with that growth for now.
We feel that we had to grow more, particularly in certain areas of the business, products, and tech to allow us to produce more games, more tailored games, and also more market launches. We've been doing a lot of work, to be fair, over the last four or five years and improving our platform so it can be more scalable. It is easier to be launching in these new markets. We're not expecting a lot more growth over the next year. There may be the odd one or two just for sort of targeted to help us achieve our goals. I think actually we have a good capacity in our team now to be definitely our short-term goals.
There's one on our marketing expenses. It says, "Marketing expenses fell substantially year on year.
What drove this change, and how is this likely to progress? Our marketing expenses are predominantly within our social business, which is non-core, our B2C premium games. Each half, first half of the year, over the past few years, we've done a relatively small marketing campaign. We did that again in 2024. It was slightly lower. It had a better effect in 2024. I think we'll see that happen again in 2025. I think that'll probably remain a similar quantum to 2024.
Great. Next question is, "You reported strong growth in Canada in 2024. Can we anticipate that for the market in 2025 and 2026? Should Alberta bring even faster growth dynamic?" Canada actually has been a really good growth story for us. There's one regulated province, which is Ontario, which we were live partway through 2023.
We are live with the only regulated operator in Quebec, which is the lottery. We will be live very soon with the only regulated operator in British Columbia, which is the lottery there, which covers a few other provinces' lotteries. Alberta is targeted to be the next commercial province which opens. Quite a few of our partners are really excited about that market. We think it can be a decent-sized market for them to be operating. Of course, we will be there supplying our great content as well. I guess the answer is yes, that should bring faster dynamics in that market for sure. I think that is targeted for the beginning of 2026 rather than 2025, albeit the date has not been set yet.
I think final question we have here is, "Do you have any idea of the status of the Gambling Act review when it'll be implemented?" I assume this is U.K. This is already being implemented in stages. There is more regulation, I think, coming for mostly this is on the operator side. There is more that they'll be looking at on bonus levels and things toward the end of this year. Particularly on the game side, we are already compliant with most of, well, almost, I think all of the things they're bringing in. The only one which is coming in next week is around the staking limits. We have tried to get ahead of that and already brought in the staking limits on our side earlier. We are already sort of hopefully compliant. We have just got one or two little ticks to go before we go there.
Yes, that's either in progress or coming very soon for all of the changes that they are proposing.
That's great. Mark, Geoff, thank you for addressing those questions from investors today. Of course, the company can review all questions submitted today. We will publish those responses on the Investor Meet Company platform. Mark, before we redirect investors to provide you with their feedback, which is particularly important to the company, could I please ask you for a few closing comments?
Yeah, I just want to thank you all for your time today. I think the message is we've had a really, really strong set of results for the last few years. We are executing better every year. This year we will execute better again. We have lots of really exciting things in the pipeline, having new market launches, partner launches, product launches.
We're really excited to see what the future brings. Thank you all.
That's great. Mark, Geoff, thank you once again for updating investors today. Could I please ask investors not to close this session, as you will now be automatically redirected to provide your feedback in order that the board can better understand your views and expectations? This will only take a few moments to complete, and I'm sure will be greatly valued by the company. On behalf of the Management Team of Gaming Realms, we'd like to thank you for attending today's presentation. Good afternoon to you all.