Newgioco sees revenue boost in 2019 full-year results as betting handle rises

Newgioco Group Inc (NASDAQ:NWGI), a gaming technology company with gambling operations in Italy, reported its 2019 full-year results, revealing a modest revenue increase year-over-year thanks to a bump in betting handle. The company brought in revenue of $35.6 million, up nearly 3% from $34.6 million in 2018. Betting handle, or the amount of money in wagers accepted, grew almost 10% to $454.1 million from $413.2 million in 2018. That growth was right in line with its goals, the company said, particularly given that the FIFA World Cup occurred in 2018. READ: Newgioco Group reopens all land-based betting shops throughout Italy Web-based betting handle increased by 39%, as Newgioco converted customers to online gaming. Newgioco reported a loss of $3 million, compared to $200,000 in 2018. This was due primarily to the increase in commissions paid to retail agents, $3.5 million which was reflected in the growth of betting handle, coupled with costs associated with the acquisition of gaming software company Virtual Generation.  “We are very pleased with the results in our Italian operations during the year ended December 31, 2019,” CEO Michele Ciavarella said in a statement. “Despite the modest increase in revenue, we were intensely focused on organizational stabilization with the acquisition of Virtual Generation in January 2019, a key component of our betting technology roll-up strategy.  The increase we experienced in handle is further evidence of market adoption of our leading-edge Elys betting platform considering that we managed to organically grow by about 9.9% despite the absence of any major international sporting events in 2019.” Web-based betting handle increased by 39%, as Newgioco converted customers to online gaming. “Anticipated legislative challenges that are ongoing in the regulated Italian market continue to factor in our strategy to position from land-based betting shops to web-based operations,” Ciavarella said. “Legislative maneuvers in Italy are expected to further bar entry of foreign and unregulated operators into the Italian market and the operational tactics we are employing are generating key metrics that measure market adoption of our products and services that savvy sports bettors demand. This key data could be crucial to our competitive advantage as we seek to drive into the US markets.” Newgioco provides bet processing for casinos and other gaming operators online and in retail betting shops throughout Italy. In 2020, having listed on the Nasdaq in December, it has its sights set stateside. “Our regulated market know-how could be instrumental as we plan to expand into new geographical regions and new markets,” continued Mr. Ciavarella. “Looking forward to 2020 we have our sights firmly focused on the US market and believe our state-of-the-art betting platform, which is built from the ground up specifically for each market, may be highly sought after by new partners.” The company's full-year results were reported later than usual due to the coronavirus.  Contact Andrew Kessel at andrew.kessel@proactiveinvestors.com Follow him on Twitter @andrew_kessel