Hello, everyone. Welcome to FansUnite's Q3 Fiscal 2023 earnings call. For those who are unfamiliar with FansUnite, FansUnite is a global sports, entertainment, and gaming company focused on regulated and lawful sports betting affiliate market, which includes customer acquisition, retention support, and reactivation. FansUnite trade from the TSX under the ticker FANS, F-A-N-S, and on the OTCQB under the ticker FUNFF, F-U-N-F-F. My name is Prit Singh, I will be the moderator for today's call. Before we begin, I would like to go over the legal disclaimers. I will pause here for a few seconds so our viewers can read it. On today's call, we will be covering FansUnite's Q3 Fiscal 2023 financial and operational highlights, as well as its growth outlook for the remainder of 2023. At the end of the session, we will host a Q&A session.
If you have any questions during the webinar, feel free to send them in using the Zoom Q&A function at the bottom of your screen. If you are calling in to listen to this webinar today, please email your questions directly to ir@fansunite.com, ir@fansunite.com. We will address these questions during the Q&A session. Our presenters today will be the CEO of FansUnite, Scott Burton, and CFO of FansUnite, Graeme Moore. I will now turn the conference over to Graeme Moore, CFO of FansUnite, to discuss the company's Q3 Fiscal 2023 financial results.
Thanks, Prit. Just so everyone knows how this will be structured, similar to prior quarters, I'm gonna first speak to the Statement of Profit and Loss for the three months ended September 30th, 2023, or Q3 2023, as I often call it, and then I'll move to the nine months ended September 30th thereafter, or year to date, and then finally I'll talk to the balance sheet. The one difference this, this presentation that I do want to highlight is the fact that we have added a section in our financials called discontinued operations, which is a result of the sale of McBookie and Chameleon that occurred in May of this year.
Chameleon and McBookie made up our iGaming segment in the past, and the financial results for the iGaming segment have been moved to their own section on the statement of profit and loss. When speaking about the financial results below, current year figures, as well as all comparatives, are referring to continuing operations unless otherwise specified. I do have a specific section that talks to discontinued operations. This is obviously very different than anything we've had in the past, so if there are questions, please, as Prit mentioned, email ir@fansunite.com or submit them via the question function, and we'll be happy to get to them after. So for the three months ended September 30th, 2023, our revenue increased to CAD 4.8 million, when compared to CAD 4.3 million in 2022.
This growth is a result of increased activity levels with existing customers throughout the year, compounded by the acquisition of multiple new customers, launch in new states, and expansion in the bespoke research market. Our Bespoke Research market contributed CAD 288,000 this quarter. I do wanna note that the increase in revenue was constrained by one of our operators experiencing a cyber attack, which led to inactivity for several days during the start of football season, which is one of our most active periods of the year. Our cost of revenue was CAD 2 million in Q3 2023, compared to CAD 2.2 million over the same period in 2022, and the gross margin percentage was 59%, as compared to 50% in Q3 2022. So again, revenue is up and our cost of revenue is down.
The improvement here primarily relates to a focus on higher margin operation, which has led to efficiencies realized through the sale of certain lower margin digital assets. The sale of digital assets, such as Wagers and BetPrep, has resulted in reductions in contractors and led to improved margin, as our focus has shifted towards live activation and the research segment. Overall, net loss from continuing operations for the quarter was CAD 4.3 million, which compared to a net income of CAD 42.4 million in Q3 of Fiscal 2022. So I do want to say here, in 2022, we had a revaluation gain of CAD 51 million, which significantly changed our net income position.
However, once we removed that, efficiencies were seen in selling general and administrative expenses, which were roughly CAD 8 million in the three-month period in 2023, as compared to CAD 12.4 million in 2022. Finally, improvements were achieved in other non-cash income items through reductions in the expenses related to deferred and contingent liabilities, which is a direct result of the earn-out restructure that we did in 2022. Our G&A expenses decreased slightly to CAD 448,000 in Q3 2023, compared to CAD 487,000 in 2022. The company saw improvements in G&A expenses as the reduction in non-segment-specific employees reduced the need for auxiliary spending. There were further gains seen from the reduction in software that was specific to the digital affiliate market, as the company acted on targeted efficiencies found in the business.
Professional fees also decreased slightly to CAD 293,000 , compared to CAD 305,000 in 2022. This decrease is a result of reduction in recruiting expenses, and AmAff now has a well-established team that's appropriately sized, given the current revenue activity. Salaries and wages decreased to CAD 1.8 million in 2023, compared to CAD 2.4 million in 2022. Last year, you might remember that the AmAff executive team was reduced in line with the earn-out buyout, which led to severance payments made in that quarter. Further gains were recognized over the year as a result of the reduction in executive salaries, largely in the AmAff business. Sales and marketing expenses also decreased to CAD 67 thousand in 2023, compared to CAD 291 thousand in 2022.
We curtailed a lot of our spending related to marketing the company in the public markets, given the current macroeconomic environment and just a lot of the traction we were seeing. The termination of agreements pertaining to a number of external consultants also contributed to reduction in the spend in this category. Now, if we pivot to the nine-month period or year to date, our revenue year to date has decreased to CAD 17.2 million, compared to CAD 17.5 million over the same period in last year. This change is largely, t he fact that we had a decrease is largely related to the record revenues we saw in Q1 of 2022.
So in Q1 of 2022, New York legalized sports betting, and after an initial huge boom, New York State actually changed their regulations, which disallowed sports betting affiliate use in bars. We have a really significant bar network. That's one of the things we really rely on for our live affiliate revenue. So not being allowed to have sports betting affiliate activity in bars has led to did lead to a significant decrease in 2023 revenue in New York when compared to 2022. Again, I do want to mention here, as I mentioned above, that we also had a cyberattack on one of our major customers during the first couple of weeks of the NFL season, which is always one of our busiest periods of the year.
Year to date, our cost of revenue is CAD 6.3 million, as compared to CAD 8.1 million over the same period in 2022. The resulting gross margin is 63% this year, compared to 54% last year. That is a massive improvement that I do want to say we are really proud of as a company, and we'll look to continue going forward. So the improvement relates primarily to the continued gain in efficiency related to AmAff. Again, we've shifted our focus away from pursuing growth of our digital asset portfolio and focused on the live activation. We also have focused on a continued diversification of Betting Hero business, including the growth of our high-margin revenue streams, such as research. These efforts led to the signing of a research contract with a premier U.S. sportsbook during the period.
Overall, we expect margins to remain high as the affiliate business continues to gain efficiencies in existing markets and the company acquires additional research contracts. Our net loss from continued operations year to date is CAD 14.3 million, which compares to a positive net income of CAD 23.8 million in the prior year. As I mentioned above, this CAD 38 million swing is due to a number of factors in both periods, both directions. Firstly, there was a decrease of share-based payments to CAD 1.4 million, as compared to CAD 5.3 million in 2022. In 2022, we issued stock options as part of the earn-out buyout. We issued warrants as part of the bank indebtedness, neither of which occurred in the current year. We also had an approximately CAD 8 million reduction in accretion of the contingent liability in 2023.
In total, our non-cash expenses totaled CAD 17.7 million in 2023, as compared to CAD 29.6 million in the same period last year. This CAD 12 million improvement in net income was offset by the fact that in 2022, we had about a CAD 52 million revaluation gain due to the restructure of the contingent consideration, and obviously, we didn't have that same gain this year. Our G&A expenses stayed roughly the same at CAD 2 million this year, compared to CAD 1.9 million in 2022. The primary cause of this increase relates to travel expenses. As a couple of new states open, and as we look to find a more efficient way to run our teams, our Betting Hero business has established operations in different states.
As we look to spin up new teams and make sure we're operating as efficiently as possible, there are definitely some setup costs there. This is typical in a geographically distributed workforce, but we do expect this to come down as we get settled going into 2024. Our professional fees increased to CAD 1.4 million, as compared to CAD 1.1 million in 2022. During the current year, we had legal services rendered in relation to the sale of our BetPrep asset, McBookie, and Chameleon Gaming's platform source code. The increase in legal fees was offset by the reduction in legal expenses related to the earn-out buyout in the prior year comparative period. Salaries and wages decreased to CAD 6.1 million in 2023, as compared to CAD 6.8 million in 2022.
As previously mentioned, in September 2022, the company reduced executive-level headcounts in AmAff as part of the earn-out buyout. This included some severance paid to the aforementioned executives, and obviously, no such expense was present in the current year. Sales and marketing also decreased to CAD 376,000 in 2023, compared to CAD 821,000 in 2022. The sale of Wagers and BetPrep contributed to a reduction in marketing spend when compared to 2022. The company also curtailed our spending related to marketing the company in public markets due to the macroeconomic environment. As I previously mentioned, discontinued operations obviously are a big part, not necessarily of our future, but of our path, and so I do wanna touch on them briefly here.
When we look at discontinued operation, the majority of the impact can be seen as a result of Chameleon. So our net loss from discontinued operations for Chameleon in the nine months ended September 2023 was CAD 5.9 million, as compared to CAD 19 million in the same period in the prior year. Chameleon had negative gross margin of CAD 47,000 this year, compared to positive CAD 117,000 in prior year. Now, the reason we had negative gross margin is there were costs associated with winding up that iGaming segment, some data providers and such, that we had to pay a little bit past the revenue was coming in. I'm happy to say that is all cleared up now, but just in case you're wondering, negative gross margin obviously stands out as a bit of a red flag.
There were selling general and administrative costs of CAD 5.7 million, which compared to CAD 7.8 million in the prior period. These were largely salaries and wages, professional fees, and G&A expenses that will not affect the company's financial position going forward. Also, in September 2022, we had a non-recurring CAD 11 million dollar impairment charge that further increased the loss, which is why that CAD 19 million last year, obviously, it wasn't all cash. If I move to the balance sheet now, our total assets decreased to CAD 61.5 million on September 2023, compared to CAD 77.5 million at year-end. During Q2 2023, we sold McBookie, which resulted in the disposal of CAD 1.2 million dollars of total assets, and similarly, the Chameleon Gaming Platform was sold, resulting in the reduction of CAD 5.9 million dollars in intangible assets.
The intangible assets were reduced further by amortization of CAD 14.7 million year to date. This was offset by increase in investments of CAD 2 million related to the share purchase warrant in Betr, and an increase of CAD 2 million in receivables related to milestone payments, both as a result of Chameleon sale. The decrease in total assets was also mitigated by the sale of BetPrep, which led to the recognition of about a CAD 200,000 receivable. Our total liabilities decreased to CAD 26.7 million at September 2023, compared to CAD 34.5 million at December 2022. The primary driver of the decrease in liabilities was the result of the repayment of CAD 5.5 million of the long-term debt balance.
Our contingent consideration decreased to CAD 19.4 million, as compared to CAD 20.8 million at year-end, due to scheduled payments associated with the acquisition of American Affiliate. When related to our cash position, our company's cash position decreased by CAD 624,000 at September, as compared to a decrease of CAD 9.4 million over the same period in 2022. Our increase in cash for the period end of September 2023 is largely due to the receipt of a non-brokered private placement of CAD 3 million, cash receipt of CAD 3 million from the sale of Chameleon, and cash proceeds of CAD 5.2 million for the sale of McBookie.
Those above items were offset by CAD 5.5 million dollar repayment of long-term debt, and about CAD 600,000 of routine and early repayment interest, as well as, excuse me, CAD 2.3 million dollars in earn-out consideration paid during the nine-month period. I do want to highlight here that our cash at September 30th was CAD 2.3 million, which does put us in violation of our cash covenant with respect to our loan with Centurion. We reached out to Centurion in advance of September 30 in order to work with them as business partner. I'm happy to report that those talks are progressing well. We hope to have a waiver as well as a plan going forward in the near future.
Our AR was just under CAD 6 million at September 30th, and if you add cash and AR, we were over CAD 8.2 million at September 30th. So we are largely dealing with, and Centurion is understanding and working with us here, that we are dealing with the timing questions as far as collections. And so our plan is to work with them, make sure we aren't tripping a covenant just because a couple clients paid on October 6th instead of September 29th. As of September thirtieth, the company had net working capital of CAD 1.5 million, which compared to a net working capital deficit of CAD 4.2 million at year-end. The big liability here is obviously the CAD 3 million U.S. deferred payment. We have a really good relationship with the parties involved, and they understand the position we're currently in.
We're in talks around alternative arrangements that we will see them paid without impacting the business negatively, and they also, everyone keeping in mind the covenants tied to our debt that I previously mentioned. An important part we'd like to highlight is that if you look at our financial statements, operating cash flow was negative CAD 3.3 million. However, within that cash flow, and this is one of the weird things, where you separate discontinued operations in the profit and loss, but not within the cash flow. So within that negative CAD 3.3 million is cash flows used in operations of CAD 4.2 million, which is not recurring due to the sale of McBookie and Chameleon.
So that is to say, all else being equal, our company generated positive cash flows of CAD 900,000 from continuing operations in the first nine months of the year. Our work to become cash flow positive from the last 12 months is working. We are seeing positive results, and we anticipate seeing even more positive result as our focus shifts away from winding up those continuing operations and towards maximizing and profiting from our continuing operations. That's all for the financial update on FansUnite, and I'll now turn the call over to Scott Burton, our CEO.
Thanks, Graeme. As you said, I'll talk about the operational highlights mostly for the third quarter of this year. You know, as with the previous quarters, Graeme mentioned a lot, but we really continued to focus on the operational and financial efficiencies. That was highlighted by the sale of McBookie and the Chameleon Gaming platform, and then moving DragonBet off of the Chameleon platform. They were our final B2B customer. The sale of both assets and the migration of DragonBet allowed us to focus on growing the cash flow positive side of the business, which is the affiliate. We think that's the way forward to generate better shareholder value, and we will continue to grow the affiliate business, increase margins, and look to reduce costs as we move through 2024.
September was when we completed the migration of DragonBet. That, combined with the sale of the Chameleon source code to Betr, completed our transition away from business-to-business platform licensing. As a result of the transition, we expect to achieve annualized cost savings of approximately CAD 7.8 million. This includes reductions in salary and selling, and then G&A costs, the general and administrative costs. The moves were necessary for us to reach the goal of being cash flow positive by the end of 2023, which is, I think, what we've been talking about every quarter for the last three or four quarters, that we knew we had to be in that position by the end of this year. In terms of the continuing operations that Graeme talked about, Betting Hero is our primary one.
It's continued to expand its U.S. footprint by participating in the launch of regulated wagering in Ohio, Massachusetts, and Kentucky. That business, the affiliate business, contributed significant revenue of CAD 4.8 million and CAD 17.2 million to the results for the three and nine months ended September 30th, 2023, respectively. As part of the strategy to continue diversifying revenue streams and smoothing the seasonality of the North American sports calendar, the Hero team continued to grow lines of the business outside of live activations. So the research segment has grown in the fiscal year, including a contract signed with a premier U.S.-based sportsbook during the period. They continue to do an exceptional job of servicing the live activation partners they have, while also growing their research, digital, and hotline segments of the business.
The continued diversification will add higher-margin business and contribute to mitigating seasonal effects of the Betting Hero's revenues. There's the other segment of the affiliate business that we haven't talked about a lot in the past. This is Props.com, and that's our digital brand, and we can start to begin to look at our digital strategy more, and that would be more of a focus as we have these discussions going forward. Over the past 12 months, as we've mentioned previously, our focus first was on reducing costs. We elected to move away from podcasts and other sites to focus on Props.com, which is our marquee affiliate site.
During the three and nine months ended September 30th, we achieved cash savings associated with running Props of CAD 233,000 and CAD 586,000, respectively, when we compare that to the same periods in 2022, so we're able to see substantial cost decreases in that time. Once we got to a point where we had completed our cost review and rationalization of the digital affiliate business, we're able to move the focus to growing revenue on, on Props.com. For the three and nine-month period, revenue increased 282% and 571%, respectively, over the same periods in 2022. Props also now sits on a proprietary affiliate platform that we've developed. The platform is now ready to scale, not just for Props, but for, for a number of other assets.
As we continue to grow Props, we can assess our library of other affiliate domains, which we have 20+ that we own, and we can look to add them to this platform to add additional digital revenue to the company. Going forward, we know sports betting and iGaming are gonna continue to be legalized in more North American states. Betting Hero will maintain its aggressive expansion into new markets in partnership with our affiliate customers, and by entering into strategic partnerships with ancillary industry operators and growing its market research and consulting teams, Betting Hero continues to diversify its revenue streams and will add, seek to add additional value to customers all year round. Recently, they have grown the research revenue stream, which consists of value-added reports for customers, providing them with insights and information needed to better serve their markets.
In addition, Props.com continued to see month-over-month growth and can serve as a launching point for additional digital revenues. Consistent with our path to profitability plans, we've conducted strategic reviews on certain business segments to identify opportunities for both operational and financial efficiency. This review has led to sales of some of our assets, such as the Malta B2B gaming license, our betting analytics brand, BetPrep, McBookie, and the Chameleon gaming platform.
So I'd say the last year has been challenging, but our team has executed on our initiatives and secured our path to profitability now, and we've put ourselves in a position of being cash flow positive, which means we can now get away from all of the restructuring we've been doing, downsizing or rightsizing the business, and just purely focus on moving forward with growth and growing both the digital brands and also the Betting Hero, and look at other inorganic opportunities at the same time as the organic ones that come from state openings. So that's the formal part of the presentation. Thank you all for joining us and listening, and the support, and we will move into questions and answers that will be moderated by Prit for us.
Thanks, Scott. Thanks, Graeme. As mentioned, we will now turn the call over to the Q&A session. For those of you that do have questions, just a reminder, you can message us in the Q&A function at the bottom of your Zoom screen. Alternatively, you can email us at ir@fansunite.com. Okay, let's get started. First question: "Can you. Sorry, when can the investors and the viewers expect FanDuel to become profitable?
Yeah, I can take this one. So again, this, as Scott mentioned, this has been a focus for us for the last year. With all the changes that we have, the migration of DragonBet, Chameleon, McBookie, we're seeing those results. If you look at our adjusted EBITDA at the end of our MD&A, you'll see that for the nine months ended, we're positive CAD 1.1 million. For the three months ended, we're positive CAD 200,000. So when we talk profitability, net income is one thing, and obviously, as long as we have, you know, intangible asset amortization and share-based payments, that's gonna take a while. We are really focused. When we say profitable, we mean cash flow positive. So we're gonna continue seeing even more savings in Q4.
Obviously, as Scott mentioned, DragonBet wasn't migrated completely off onto their own platform until September of 2023, so we didn't get the full cost savings, despite, you know, how positive all of those things are. So, I think we, we are cash flow positive in Q3, if you look at continuing operation. So now that our our discontinued operations are more fully wound up, I think Q4, you will see truly cash flow positive. And then we anticipate every quarter after that going forward, as long as, o bviously, once we factor in the, the seasonality of the summer, but that'll be our focus for the next six months, is, enjoying and working hard through the busy part of the sports calendar, and getting ready to make sure we can remain cash flow positive during the slow part.
Thank you. Can you expand a little bit on the company's strategy to achieve cost savings?
Sure, yeah. I mean, I think a lot of this strategy is what we've been executing over the last nine months. So if you look at what we've done in McBookie and Chameleon, we've let 61 people go, which is approximately about 60% of our full-time staff. If you compare to what our headcount was at March of 2023 to what it is at September, so in the last six months, so that's very significant savings in headcount, which has always been our, our largest cost center. As far as continuing, I think one of the main things that we will look to do now is we focus on optimizing Betting Hero. Scott and I, from kind of a corporate standpoint, have been focused on discontinued operations and making sure that, you know, we maximize shareholder value as we wind those down.
We'll now focus to empowering the Betting Hero team to make sure they're running as efficiently as possible. I don't think we'll see as significant headcount reductions or anything like that as we've done so far. They've always run a really lean team. They always have that entrepreneurial mindset that we love, and so we'll just work with them to make sure we're optimizing everything and adding our skill set to, to their significant skill set.
Thank you. Touching on Betting Hero, can you expand on their additional revenue streams?
Sure. So live activation is obviously kind of their flagship. That's what Betting Hero started with, that's where they, they built their name, and that's where, as Scott mentioned, pretty much today, all of their revenue comes from. When I talk about additional revenue streams here, there's two that we've talked about in the past. One is the research. So if we look at our Bespoke Research market, it contributed about CAD 288,000 in this three-month period, which is really strong. We're really happy with that. We've never had a million-dollar year in research, and so the fact that we had, you know, CAD 288,000 this quarter is something that we are really happy with, and as mentioned, it's really high margin, so it, it's not necessarily dollar for dollar on revenue there.
We also signed one of the major, major operators in the U.S. to recurring research engagement, which builds up this research and makes it less of a one-off where we have to constantly be selling, and more of a recurring revenue base as we head into Q4, and this is one of the ways we plan on kind of shoring up the seasonality of the calendar next summer. The second revenue stream that we've touched on in some of our investor presentations is the Hero Hotline. This is still pre-revenue, but it's definitely ramping up. Jai Maw, who's one of the Betting Hero founders, has spent a ton of his time proving out the model for our partners, making sure that when this launches fully, we will have a sustainable revenue stream.
We haven't hit that stage yet, but we are really encouraged by the progress that's being made. And one of the really great things about this launch is we are leveraging a lot of our skills and people that we have in other areas of the business. So it's not like launching Hotline is like launching some of the other lines of business, where it's a significant capital investment. We are able to leverage people that are doing other profitable things for the company into building Hotline up in advance of launch, so that when it does launch, it can be profitable, not necessarily on day one, but really soon after.
Perfect, thank you. Just touching on Props.com, with Props.com scaling its revenue, what is the company's strategy to grow operations?
Yeah, I'll take that one. As I said in the thing, in our previous talk, it was really first about getting the costs in line on that whole digital affiliate side, which included some podcasts and a number of other domains we were trying to run. So we got it down to really just Props, and we wanted to get that operating very efficiently, and in a way that we knew it could get to profitability, and then use that as a model for other brands. So we own a number of other domains in the affiliate space, and they're not being used right now. They're parked until we got this done, which is starting to see it now with Props.
In addition, we wanted our own platform, to build on, to, reduce costs in the long run, but also give us some flexibility, and then add increased value to the overall digital side of the business. By having a platform that can support hundreds of different domains, it becomes quite a valuable product in the affiliate space. What we're doing now is looking at creating very high-quality content, leveraging the people we have within Props. It's a smaller team running it now, but we're also leveraging some of the new automated content that you can get out there, which is turning out to be quite good. It's a cost-effective way to grow the content on the site, while not increasing headcount and cost significantly.
What we wanna do now is get Props a bit stronger in terms of revenue growth, so once we've sustained that and moved to a cash flow positive product, we would then look to bring other domains online. And again, these are all around the affiliate space, so they would be doing similar thing, which would be just driving traffic to either online sportsbooks or online casinos, or both. And we think that we can start doing that in 2024, and then start to see the digital side of our business contribute quite a bit more than it has in the past, but do it profitably, and that's gonna be the focus for that area of the business.
Perfect, thank you. Question on DragonBet. Can you provide more insight into why FansUnite decided to transition away from its B2B business?
Yeah. Obviously, I would say it was a challenging decision to make. We sat down as an executive team and board and looked at the overall environment and what was happening in the sports betting industry, what was happening to other B2B operators, and then also what the outlook was for the current stock market condition and macro environment, and the ability to raise capital going forward. And we decided that it was a part of the business that was starting to commercialize better. So we had DragonBet and Betr, and a good pipeline of business that we think we could have added to grow the revenue side of the business, but it was by far the largest cost center in the company.
For us to continue to grow the revenue on that and try and take business from other competitors, we would likely need some additional capital in the next, you know, 12-24 months. And again, in the current environment, we just couldn't accept the losses that we were getting out of the business, and the potential requirement for more money to go into it. So we had this opportunity to monetize what we had and take a return on the code base while maintaining the right to use the code in the future. You know, things could change in the future, but for now, where we want it to be, and we've said for many, many months, is the FansUnite would be cash flow positive by the end of the year.
And we would not have been able to do that if we didn't make that change to move away from the business-to-business platform and everything that came with it. That's the decision that we made, and it's put us in this position now of hitting our real target of being cash flow positive.
Perfect, thank you. Additional questions. Next question: Are you able to forecast a target quarterly period for when the remaining debt is anticipated to be paid off, given improvements to EBITDA, as well as future CAD 3 million part two cash payment from Betr in 2024? So I guess it's two questions. Yeah.
Yeah, it really is kind of two questions. So first, the EBITDA improvements. We don't anticipate using any improvements in EBITDA or cash flow generated in operations to repay our debt. We want to use that to reinvest in the business, to pay other liabilities to grow, right? So that's kind of where we are singularly focused as far as our EBITDA improvements. When you swing to the Betr payments, legally, these can be swept by Centurion. They have a right to kind of proceeds from asset sales, which these would be deemed. We anticipate that Centurion will exercise their contractual right here, and will sweep those payments, which would put us debt-free in May of 2024. However, we will always work with them, and, you know, we always try and retain as much cash in the business as possible.
But assuming everything goes as it's currently forecasted, I would say May of 2024 is when that debt will be wiped off.
Thank you. Just to follow up with that question, how confident is management that the conditions underlying the remaining milestone payment from Betr will be satisfied?
Yeah, we are, we're confident on that. We know their timelines. Obviously, they're in control of their timelines, but we know the underlying milestone payment and what relates to it. We know the tech team that's responsible for implementing it, 'cause they were largely ours. And we're in contact with them as recently as last week to discuss. So we're still very confident. It's a key part of their timeline for the product, so we're confident that that'll get done, and that remaining milestone payment related to the condition will be satisfied in 2024.
Thank you. Next question. Salaries and wages were CAD 1.8 million for the period. What is the range of expenses for this line item that investors can expect, this going forward, appreciating there may be seasonal fluctuations?
Yeah, it's a good question. Obviously, the seasonal fluctuations is a really important part of that. If I look to 2023, we had about CAD 2.2 million in Q1 of salaries and wages, about CAD 2.1 million in Q2, and then about CAD 1.8 million in Q3. So I think that's fairly indicative of where we'll be hovering.
Obviously, CAD 1.8 million shows some of the efficiencies that we've gained. We've obviously reduced our corporate headcount, just as a result of not having as many employees to support. So I would anticipate being a little on the low end of that, while recognizing that the Q3 number of CAD 1.8 million had July and August, which are two of our slowest months, and September, which is a busy month. So I can't say that we'll be that low every quarter, but we should be hovering around kind of that CAD 1.8 million-CAD 2.2 million.
Okay, thank you. Next question. Are there any other legacy assets, such as source code from RNG games, that can be sold off? It is acknowledged that source code for Chameleon can always be sold, as has been previously explained, given the terms and conditions associated with the Betr transaction.
Yeah, there are a few things in there, but the one that's been highlighted by the question is RNG games, and the answer is yes, there's some assets there that can be sold off. We are actually speaking with a group now about that, so it's kind of come up to the top of the list of things to address again. You know, the other parts of the business that we have sold off or dealt with still had significant costs tied to them, so we needed to get rid of those. And now we can continue our work on monetizing assets that aren't being used, and RNG games is one of those that we can do. Outside of that, potentially, you know, we sold our Malta B2B license.
There's possible additional license sales that we could look at, and we'll look at our domain cat library as well. Talked about our affiliate platform, our proprietary affiliate platform, that can now handle hundreds of affiliate sites effectively. So we will look to bring some of those online, but there may also be some that we decide we want to sell off. So we'll be looking at all of those things.
Okay, thank you. Next question. Just wondering if FansUnite has any plans or is still planning on buying back some of their shares on the open market?
We have, you know, we extended the NCIB in anticipation that there will be a time where we'll look to do that. We haven't been doing it because we weren't at our goal of being cash flow positive, and we had some debts and liabilities that, you know, we're responsible for. Now we've got ourself positioned where we know we'll be cash flow positive going forward, and we have a timeline on when the debt will be repaid. We can look at that. Again, we're not doing it immediately. It didn't make sense as a small cap company that wasn't generating cash to take valuable cash, knowing it's hard to raise money right now. So we weren't gonna put that back into buying back stock or consider it until we got ourselves positioned, and we are now in a much stronger position.
But Q4, Q1 will put us in a really strong position, I would think, and then we can look to assess our cash position, what the stock is doing, and what's the best use of capital at that time.
Okay. Thank you. Just last question here: what are some catalysts investors can expect in the next six to 12 months?
Yeah. I'll take that. There's a handful of them. You know, what we've talked about for so long was getting to this point. You know, in the earlier calls this year, one of the catalysts would be showing that we'll be profitable. And as Graeme mentioned, if you look at the continuing operations and what cash flow was, and we talked about being cash flow positive, you know, we're there, and we should be able to show it strongly in the Q4 numbers, Q1 numbers, and going forward. So that was a big catalyst. I think Q4 results or year-end results will show how well we've done on that. We always have, I say, sort of the organic growth that we'll be seeing.
There's going to be more states opening up in the U.S. So as states open up, our Betting Hero brands, our Props brand, we'll be able to monetize that. So we'll see some organic revenue growth with additional states opening up in the next 12 months. Hopefully, we'll land one of the larger states, but we know of two or three that should be coming online early in the new year. There's another area that's, I think, an exciting one for the potential and what it can do to the business. We'll see growth in the iGaming or online casino states coming online. So everything we've done to date is largely revolved around sports betting, and you'll see, you know, half the states have done something around sports betting. Much fewer states have addressed online casino, but we know they will.
And when those opportunities come up, they will present us with better revenue, less seasonality, and higher margins. So that's an area that I think people don't understand about the business and, and what's to come. So yes, we'll continue to be a sports betting affiliate, but more and more we hope to see online casino affiliate opportunities, and that's when we'll see a real, I think, a step change in terms of revenue and some, some margin improvements. Then finally, in 2024, which, you know, is in the next 12 months, we'll eliminate the debt which, which will make us really a debt-free, cash flow positive business, which I think at this time in the small cap tech gaming space is pretty rare.
So I think we're an interesting opportunity for people to look at now that we've done the work that we've talked about, we've executed on it, and we can now focus on moving into 2024 and getting back to growth and some of the more exciting things as opposed to restructuring and cost cutting.
Perfect. Thank you. So I think that will wrap up the Q3 financial results earnings call. Thank you, Scott and Graeme. I'd like to thank everyone for joining us today. Just as a reminder to those, FansUnite does trade on the TSX under the ticker FANS, F-A-N-S, on the OTCQB under the ticker FUNFF, F-U-N-F-F. Should you... We will have a recording of this webinar. Should you have any questions or would like a copy of the webinar, you can email us at ir@fansunite.com. Again, that is ir@fansunite.com. Also, if we did not get to any of your questions, please do email us at the same address. Again, thank you, Scott and Graeme.