Golden Matrix Unveils Earnings For Q3 2023; Net Loss Due To Pending Acquisition Costs Of MeridianBet Group

Golden Matrix Group Inc. (GMGI), one of the flagship global iGaming groups, which offers sportsbook, casino and competition products and is based in Las Vegas, revealed revenue data for its third quarter ended July 31, 2023, where it was shown that it achieved income of $11.3 million, up 24.2% year-over-year, according to the Nasdaq news.

Net loss:

However, beside revenue, the company’s Adjusted EBITDA was $161,783, a dramatic drop of 83% compared to the same period in 2022 when it was $1 million. The primary reason for this big fall was the firm’s net loss of $965,628, which compared to the net profit of $628,332 for 2022 represents a big fall.

Additionally, the net loss resulted from the firm’s changes to the purchase deal with MeridianBet, which enabled both companies to alter the starting $300 million agreement and lessen the starting $50 million in cash payments from Golden Matrix to $30 million, with an extra $20 million in a post-closing cash consideration. But regardless of the amendment contract, it will nevertheless be subject to shareholder validation. Speaking on the issue, Brian Goodman, CEO of Golden Matrix, lodislot commented: “We have continued the year with strong momentum and delivered solid results. The Company achieved record revenues and posted its 7th consecutive quarter with positive cash flow from operations. With respect to the reported net loss of $965,628, profitability in Q3 was impacted by several factors, including a significant increase in one-off legal and due-diligence expenses associated with the anticipated acquisition of the MeridianBet Group, as well as the start-up marketing costs related to the roll-out of Mexplay, the Company’s B2C online casino in Mexico.”

Operating expanses increased by 72.8% in Q3:

Income from RKings, the company’s B2B segment, was estimated at $3.7 million in the said quarter, and income from its B2C operation Mexplay was estimated at $7.6 million. Additionally, GMGI acquired remaining 20% stake in RKings during November 2022, having formerly bought a large portion of the stake during November 2021.

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As for gross income, it was $2.1 million, the result of $9.1 million in merchandise sold. Then there were operating expenses which rose 72.8% year-over-year to $3.0 million, making a loss of $899,099. That loss was slightly helped by interest income of $15.1 million, but was impacted by $7.6 million in interest expanse. After provisioning for income taxes of $81.0 million, the net loss totaled $965,628 as mentioned above, a difference of $1.6 million from the prior year. Excluding one-time expanses for Q3, GMGI reported “a non-cash charge” of $931,614 for stock-based compensation.

Furthermore, throughout the first nine months of GMGI’s FY to the end of July, income reached $32.4 million, increasing by 22.4% from $26.5 million. Additionally, gross income, following $25.7 million in expanses of goods sold, was $6.6 million.

Operating costs for the year to date were $8.3 million, an increase of 62.0%, leading to an operating loss of $1.7 million.

After the income of $67,956, the loss for the 9 months was $1.6 million, plus taxes of $299,071. Also, the company experienced a loss of $1.9 million for the nine months of 2023, which is also a big fall compared to revenue of $1.5 million in 2022 for the same period. In this regard, Goodman added: “We have made important investments during the quarter in systems and people to accelerate the growth of our B2C segments, both RKings and Mexplay. At the same time, there was significant progress in seeking to secure the financing required to close… and working towards closing, the pending acquisition of the MeridianBet Group and its related companies. Upon the successful acquisition of MeridianBet, the combined enterprise is expected to be generating multiple streams of gaming revenue and profit in regulated jurisdictions worldwide… and offering highly popular best-in-class products, including casino games and sports betting. Closing of the MeridianBet acquisition will be a watershed event which is expected to catapult Golden Matrix into the global gaming markets as a highly competitive participant.”

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