November 11, 2021 Sports Betting, Legal, Online

Golden Nugget Online Gaming’s Q3 revenue up 37.4%


Company attributes EBITDA loss to investments in new markets.

Golden Nugget Online Gaming, Inc., on Thursday reported its financial results for the third quarter and first nine months of 2021.

GNOG said revenue for the three-month period ending September 30 was $35.6m, an increase of 37.4% from $25.9m for Q3 2020.

The company said revenue for the first nine months of 2021 increased 38.2% to $94.1m, compared to $68.1m during the first nine months of 2020.

Net loss for the third quarter was $31.3m, compared to a net loss of $1.8m in the prior year period.

GNOG said net income for the first nine months of 2021 was $36.7m, compared to $2.5m during the prior year period.

The company said its net loss for Q3 2021 included a loss on warrant derivative liabilities of $18.9m, stock-based compensation expense of $3.4m and $2.8m of merger-related expenses, whereas no such loss or expenses were recognized in the prior year period.

Adjusted EBITDA loss for Q3 2021 was $2.5m, compared to adjusted EBITDA of $8.2m for the third quarter of 2020. For the first nine months of the year, adjusted EBITDA loss was $9.8m, compared to adjusted EBITDA of $22.6m for the first nine months of 2020.

“The decline in adjusted EBITDA compared to the prior year period is primarily attributable to growth investments in new markets, predominantly in Michigan,” the company said in a statement.

Active first time depositors (AFTD) for the third quarter grew 133.2% compared to the third quarter of 2020, while 12-month active depositors grew 111.9%. For the first nine months of the year, AFTD grew 188.2% compared to the first nine months of 2020.

New states come online

GNOG highlighted its growth initiatives in four states this year.

In West Virginia, the company launched an online casino and sportsbook on September 22, which at the time was the third jurisdiction in which GNOG was live. The West Virginia Lottery granted the company permanent online gaming and sports wagering management services provider permits.

GNOG launched its online sportsbook in Virginia on September 29 as an untethered license holder, giving it four jurisdictions with an online sportsbook. At launch, the company made a $1m donation in support of the five historically black colleges and universities (HBCUs) in the state, which officials said was part of its commitment to be a part of meaningful change.

“GNOG is proud to continue to support HBCUs by sharing proceeds from Virginia operations on an annual basis going forward,” the company said.

In New Jersey, GNOG’s live dealer agreement with Entain was extended for three more years. The deal includes a commitment to operate additional private tables once the Live Dealer Studio expansion has been completed. Work continues on completing the 1,800-square-foot expansion of the studio, which will increase capacity from 18 to 33 tables. The studio expansion is expected to be completed by the end of the year.

The company deployed 103 new games in Michigan and 90 new games in New Jersey on web, iOS and Android in the third quarter. GNOG said it expects to bring its offering in New Jersey to  more than 1,000 games in the fourth quarter.

To facilitate the prompt consummation of its proposed merger transaction with DraftKings, Inc., GNOG said it has temporarily withdrawn its petition with the Commonwealth of Pennsylvania for an interactive gaming certificate. It expects to promptly reapply for such certificate after the merger closes.

Accordingly, GNOG said it now expects to commence operations in Pennsylvania, subject to regulatory approvals, at the end of the first quarter of 2022. As a result of this delayed launch in Pennsylvania, it expects to come in at the low end of the range of its revenue guidance for the year.

“We are pleased to deliver another quarter of double-digit revenue growth in an increasingly competitive market,” chairman and CEO Tilman Fertitta said in a statement. “Golden Nugget Online Gaming continues to pride itself in making the right investments in product, marketing and technology without wavering from our ultimate goal of profitability – as we have achieved in New Jersey. With successful launches in West Virginia and Virginia now under our belt, we look forward to expanding into new jurisdictions where we can bring our players a premium player experience.”

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