Newgioco posts 1Q profit as users switch to online and mobile gaming

Newgioco Group Inc (NASDAQ:NWGI) reported strong first-quarter results on Thursday that showed the gaming company swing to a profit compared to the year-ago quarter. Total revenue for the three-month period ended March 31, 2020 increased to US$10.2 million, up from the $9.3 million it put up a year earlier, while profit came in at $158,000 compared to the $3.1 million loss it posted in the first quarter of 2019. In a statement, Newgioco attributed the jump in revenue to the switch to online and mobile gaming from more traditional land-based venues, as well as the market’s adoption of the firm’s proprietary sports book solution. READ: Newgioco says Virtual Generation subsidiary inks content distribution deal with EveryMatrix “As a newly NASDAQ listed company during a global pandemic, I am proud of the Newgioco team,” the firm’s CFO Mark Korb told shareholders in a statement. “They have raised the bar not only from a product standpoint, but the financial team has demonstrated remarkable flexibility and elevated internal standards in terms of analytics and reporting procedures to provide more transparency and quite frankly better reporting metrics for our investors.” During the quarter, the firm decreased its general and administrative expenses by 11.8% to $2.8 million and its selling expenses dropped 16.1% to $6.2 million as a result of a “disciplined approach” to cost reduction and trade show participation, according to a statement. Return to profitability CEO Mike Ciavarella told shareholders that the results over the quarter reflected the group’s commitment to return to profitability after it made strategic changes to its board and executive management in June 2019, which Ciavarella said were the “early building blocks” to execute its US expansion plans. “Our Elys betting software is performing as effectively as it was designed for, and this has translated not only to substantial improvement in business metrics but also into acquisition and retention of new customers,” Ciavarella said. “Newgioco has one of the most modern and innovative sports betting value propositions in the market and we are now preparing to obtain (Gaming Labs International) certification of our US facing products. Our state-of-the-art technology stack is driving the innovation of managing risk on sports books and we expect to launch this unique alternative wagering system to US operators in 2020.” Newgioco’s user-centric multi-channel solution has the flexibility to serve throughout the US, from destination casino operators to franchise distribution networks like sports bars and restaurant venues or convenience stores, kiosks and coffee shops. The company ended the quarter with $6.8 million in cash. Contact Angela at angela@proactiveinvestors.com Follow her on Twitter @AHarmantas