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Gambling.com Group has shed further light on plans for its recently acquired Casinos.com domain.

The affiliate confirmed it had completed the acquisition amid its Q3 2022 results in November, saying it hoped to capitalise on the highly lucrative online casino vertical by introducing a more focused brand to its portfolio, specifically aimed at casino enthusiasts.

The brand will join the likes of Gambling.com, Bookmakers.com and Bookies.com and likely form an integral part of the affiliate’s business strategy moving forward as it diversifies its sports betting-centric product suite. 

The Casinos.com brand is set to launch later this year, and will cater to customers in the US, UK, Ireland, Canada and New Zealand to begin with.

Gambling.com Group CEO Charles Gillespie: “We don’t think a better domain exists for us to share our incredibly deep knowledge of the online casino business with online casino players.”

“We’re incredibly excited to have acquired the domain Casinos.com,” said Gambling.com Group CEO Charles Gillespie.

“We don’t think a better domain exists for us to share our incredibly deep knowledge of the online casino business with online casino players. 

“As a company, we have always prioritised acquiring the “right” domain names for our portfolio, which is clear from our namesake Gambling.com but also Bookies.com and Bookmakers.com.”

Gambling.com Group VP of commercial and casinos Lee Gwilliam: “We want players to get whatever they want from the site. That’s why we’re by players for players.”

Gillespie added that the group has “always been a casino-focused company,” and that the new domain will bring a more focused offering to casino enthusiasts than its flagship brand. Casinos.com will aim to “deliver a truly player-first experience,” Gillespie concluded.

Lee Gwilliam, Gambling.com Group VP of commercial and casinos, added: “We think there is no one market-leading really great resource just for casino players that focuses purely on casino. 

“We want players to get whatever they want from the site. That’s why we’re by players, for players.”

It is the latest Gambling.com Group acquisition to be announced, after the business wrapped up deals for other assets including Rotowire and BonusFinder in recent years.

Compared to its affiliate industry peers, Gambling.com’s stock has reported a positive year on the public markets, with its share price up 1.6% year-on-year.

While that increase is certainly modest, it puts Gambling.com’s share performance head and shoulders above that of its competitors, with affiliates such as Catena Media and Better Collective’s share prices falling by 59% and 29.4%, respectively.

Topline numbers

Gambling.com Group’s Q3 revenue grew by 94.1% year-on-year to $19.6m. Adjusted EBITDA rose 31.7% to $6.4m, giving an EBITDA margin of 33%, down from 48% in the prior-year period.

The business recorded net income of $2.3m, a reduction of 51.6% year-on-year, and generated cash flow of $5.6m and free cash flow of $4.9m.

The number of new depositing customers referred to operators by the group increased by more than 150% to over 68,000 during the quarter.

News nugget

North American revenue very nearly quadrupled year-on-year to $9.1m as Gambling.com Group continued to realise the value add of its recently acquired businesses RotoWire and BonusFinder.

The firm’s appetite for buying up new strategic assets has shown no sign of slowing down, either. 

Following the end of the quarter, the business acquired the Casinos.com domain name, where it intends to launch a new brand aimed exclusively at customers seeking casino gambling.

Speaking to analysts on the firm’s Q3 earnings call, CEO Charles Gillespie said: “We bought the Gambling.com domain name in 2011 for $2.5m, and the business behind that website now is just incredible.

“And we see an opportunity to not only do the same thing with Casinos.com, but do it faster, with all the lessons we’ve learned in the past 11 years, and do it frankly with more laser focus. Because Gambling.com covers everything – it touches anything related to gambling – poker, bingo, sports betting, casino.

“Whereas Casinos.com, it’s just casinos. And casino is the most lucrative gaming product – slots and casino games are simply where the money’s made in this industry. And by having Casinos.com, we just couldn’t we couldn’t think of a better domain name than that.”

Best quote

Gambling.com Group CEO Charles Gillespie: “Historically, we’ve been very picky with our acquisitions even in a normal market, so conversations are definitely ongoing, and we still have a preference for US or North American assets. But we don’t feel like we’re under any pressure to do the next deal, and we’re being quite cautious with how we run the business given some of the larger uncertainties out there.”

Best question

When asked by Barry Jonas of Truist Securities about Gambling.com’s outlook on M&A in the market currently, Gillespie said: “We’re still very focused on M&A, but the bars we need to hurdle to make a deal worthwhile are kind of higher than they’ve been in a while.

“The cost of capital is up, macroeconomic risks are up. Being prudent, we continue to have a lot of conversations, some of which are fairly interesting, but for us to really pull the trigger on something we’re gonna need to be extremely comfortable.

“Historically, we’ve been very picky with our acquisitions even in a normal market, so conversations are definitely ongoing, and we still have a preference for US or North American assets. But we don’t feel like we’re under any pressure to do the next deal, and we’re being quite cautious with how we run the business given some of the larger uncertainties out there.”

Current trading & forecast

Gambling.com Group reiterated previously issued earnings guidance following the release of its Q3 report.

The business expects to generate total revenue between $71m and $76m in the full-year 2022, suggesting a year-on-year growth rate of some 74% at the range’s midpoint.

Adjusted EBITDA is expected to come in between $22m and $27m, representing growth of 33% at its midpoint.

Share performance

Shares rallied by some 3.5% following the release of Gambling.com Group’s Q3 report. Shares remain down some 25.8% over the past 12 months, though this is still a better result than many gambling businesses have seen throughout 2022.

The launch of online sports betting in New York has made January the highest performing single month for revenue in the 15-year history of Nasdaq-listed Gambling.com Group.

The affiliate has been able to capitalise on the regulated launch of mobile betting in New York by sending customers to the state’s seven licensed sportsbook operators since launch day on 8 January.

The business provides content including reviews and information on bonus offers relating to the state’s leading operators on consumer-facing brands including Gambling.com, Bookies.com and crucially, localised betting domain Empire Stakes.

New York took less than a month to smash through the $1bn handle barrier and break the previous record for US monthly handle as set by New Jersey in October 2021.

“This year is off to an incredibly strong start,” said Gambling.com Group CEO Charles Gillespie.

“It is great to see our investments at the end of 2021 start to pay off and help drive strong growth, despite a particularly challenging comparable period in the first quarter of 2021 coinciding with Covid-19 related measures,” he added.

Gambling.com Group did not publish figures for January performance but did provide preliminary financial guidance for full-year 2021 and a forecast outlook for 2022.

The affiliate has guided towards total 2021 revenue of between $42.1m and $42.5m, with North American revenue expected to grow by approximately 90% year-on-year.

Net income is expected to break the $12m barrier, while Adjusted EBITDA should come in at between $18.2m and $18.7m, representing an EBITDA margin of around 44%.

The affiliate will publish its final full-year and Q4 financial report in late March.

All affiliates included in $BETZ have a better performance than the ETF itself since launch. Maybe just a coincidence. Maybe companies that actually make a profit should be more attractive. Who knows.$BETCO $CTM $GIGSEK $RAKE $GAMB $XLM pic.twitter.com/FNGwbyWIkb

— Daniel Damian (@DanielDDamian) February 7, 2022

Looking ahead to 2022, Gambling.com Group expects full-year revenue to rise by around 79% to an upper estimate of $76m, with Adjusted EBITDA topping out at $27m.

The growth is destined to come from further US states opening up regulation to online sports betting and iGaming, while recently acquired assets, including RotoWire and BonusFinder, will also be consolidated over the next 12 months.

“I am delighted with the strength in our underlying business, even before consolidating revenue from RotoWire in January and BonusFinder from February,” added Gillespie.

“We continue to invest in the business and expect to deliver another year of strong organic revenue growth complemented with additional revenue from the recent acquisitions.

“Great acquisitions, the launch of sports betting in states like New York and Louisiana, the expected launch of a regulated market in Ontario, and the debut of our media partnership with McClatchy together give me confidence that 2022 will be another brilliant year for Gambling.com Group,” he added.

Gambling.com Group’s pre-open share price has climbed by more than 4% to $11.20 per share at the time of writing.

Acquisition-hungry Gambling.com Group has purchased fellow US-facing affiliate BonusFinder in a deal worth up to €60m.

Nasdaq-listed Gambling.com Group paid an initial €12.5m for the private business, €10m of which was paid in cash. The remaining €2.5m came in the form of newly issued shares.

The maximum total consideration for the company could reach €60m, with a €19m earnout payable in 2023 and an additional earnout of €28.5m payable in 2024. The option is available to pay up to 50% of the earnout payments in ordinary shares.

Gambling.com Group estimates the deal will end up costing closer to €41m based on the forecast financial performance of BonusFinder.

BonusFinder is a pure-play performance marketing company focused on the online gambling industry in North America.

The brand publishes online portals which help consumers find and compare bonuses for online sportsbooks and casinos, the same fundamental business model as Gambling.com Group.

BonusFinder is a start-up success story. It was founded in 2019 and launched in eight US states the following year.

BonusFinder chairman Fintan Costello said: “These organisations complement each other well as partners within the North American market.

“Gambling.com Group has demonstrated its leadership position within the online sports betting and iGaming industry, and its proprietary technologies and experience will provide BonusFinder with the tools to maximise growth in this exciting new era of North American regulation,” he added.

Costello previously worked for Paddy Power and PokerStars and was senior industry head of finance and iGaming at Google between 2011 and 2014.

Gambling.com Group said the purchase would support the company’s strategy of expanding throughout North America. Canada is currently BonusFinder’s largest market, which puts the company in an enviable strategic position ahead of the regulated launch of iGaming in Ontario in April 2022.

Gambling.com Group CEO Charles Gillespie commented: “Fintan Costello and his team have developed a professional, industry-leading, performance marketing business with a customer-centric and brand-driven approach.

“The acquisition of BonusFinder gives Gambling.com Group additional scale in the North American online gambling market. BonusFinder’s strong presence in Canada is expected to drive increased market share for the group ahead of the anticipated Ontario online sports betting and iGaming market launch in April,” he added.

In December, Gambling.com Group tied up the $27.5m acquisition of US sports media outlet Roto Sports and its flagship DFS news brand RotoWire.

Nasdaq-listed affiliate Gambling.com Group has signed a media partnership with US media firm The McClatchy Company, one of the largest news media corporations in the US.

McClatchy distributes daily newspapers and runs associated digital platforms in 29 markets across 14 states, boasting local news brands such as the Miami Herald, the Fort Worth Star-Telegram, the Kansas City Star and the Sacramento Bee.

Through the partnership, McClatchy will gain access to Gambling.com’s proprietary data science platform, sports betting content team and expertise in how to monetise online sports betting traffic.

The affiliate will help McClatchy leverage its audience reach and provide valuable content which captures and monetises high-intent sports betting traffic.

Gambling.com Group CEO Charles Gillespie said: “A natural and strategic extension of our business model is to increase our reach by deploying our winning formula and content through partners which have additional scale. 

“I am delighted to announce our first media partnership is with such a significant and authoritative media organisation as McClatchy. We look forward to turning this opportunity into the case study of what is possible for a national media partnership.”

McClatchy chairman and CEO Tony Hunter added: “We are honoured to have earned the right to partner with a market-leading firm like Gambling.com Group. The combination of their tools and McClatchy’s audience of 65 million unique visitors per month makes for a game-changing partnership for both organisations.”

In November, Gambling.com Group released its Q3 2021 report, its first set of financial results since completing its public listing on the Nasdaq in July. The report showed the business generated $10.1m in revenue during the quarter, with $2.3m coming from North American markets, including the US. 

In December, the business then strengthened its position in the US by completing the $27.5m purchase of RotoWire, a US-facing sports betting and DFS news portal.

It has also set its sights firmly on the New York market that went live earlier this month, with the launch of two state-specific media portals in NewYorkBets.com and EmpireStakes.com.

Nearly six million (5.8m) sports betting transactions were registered within the first 12 hours of New York’s legal online sports betting launch as customers flocked to place mobile bets with newly licensed DraftKings, FanDuel, Caesars Entertainment and Rush Street Interactive. 

New York only launched legal online sports betting on Saturday 8 January, but the state outperformed its closest competitor Pennsylvania, where just 2.3m transactions were processed over the same period, according to the latest data from geolocation services provider GeoComply.

Over the whole weekend, transactions processed using GeoComply’s customer location solution totalled 17.2m, with 8m coming from the five boroughs of New York City. This placed the city alone ahead of any other single US state in terms of transaction volume.

The industry is watching closely to see whether the flurry of activity seen in the market’s first 48 hours post-launch is sustainable as customers begin to use up the promotional offers currently available from the state’s four live operators.

The aforementioned operators have gained a headstart on the rest of the market but will be anxious to see what happens when the next batch of licensees go live, at which point the early entrant advantage (or lack thereof) will start to become clearer.

The state’s controversial 51% tax rate continues to lend an uncertain future to its legalised sports betting market, with operators likely to register losses in the market’s early stages while customer acquisition is the order of the day.

That hasn’t stopped generous offers being made available, however, with Caesars offering to match customer deposits up to a maximum value of $3,000, in addition to offering up to $300 in further free bets.

“Today is a historic day for not only Caesars Sportsbook, but for the entire state of New York,” said Chris Holdren, co-president of Caesars Digital on Saturday. 

“We’re ready to treat sports fans across the state of New York like royalty through our Caesars Sportsbook app as we welcome them into the Caesars Empire, extend our already established roots and continue to build partnerships that benefit our bettors.”

It isn’t just operators that are bullish on the Empire State’s sports betting potential, with major international gaming affiliates also jumping into the fray. They will be crucial for sending customers to sportsbooks during the early stages of the market. 

Action Network owner Better Collective is well positioned to capitalise on the burgeoning market, having agreed partnerships with three out of four of the state’s live operators to date.

“Unlocking the fourth most populous state in the US to mobile sports betting is a huge moment for Better Collective and our growing portfolio of US assets,” said Marc Pedersen, CEO of Better Collective US. 

“We are strongly positioned and excited to continue delivering sports betting content to the many thousand sports enthusiasts from New York that visit our sites daily. ”

Gambling.com Group has also shown its enthusiasm for connecting directly with New York-based customers, with two new media portals; NewYorkBets.com and EmpireStakes.com. These sites will target the state exclusively in addition to its national Bookies.com and Gambling.com brands.

“It is difficult to overstate the significance of New York State going live with legal online sports betting,” said Gambling.com Group CEO Charles Gillespie. 

“As the largest state by population to accept legal sports bets in the US to date, there is a massive opportunity for the New York market to be not just the biggest jurisdiction for sports betting in the country, but in the world.

“With passionate sports fans and some of the most storied sports franchises, we expect that the New York market will likely quickly surpass its neighbour, New Jersey, in terms of sports betting handle and Gambling.com Group is prepared to take full advantage,” Gillespie concluded.

Gambling.com Group has strengthened its US sports betting position with the $27.5m purchase of Roto Sports and its flagship DFS news brand RotoWire.

The acquisition is expected to close in January 2022, at which time the affiliate will pay out an initial $20m, consisting of $15m in cash and $5m in newly issued shares.

Gambling.com Group will then pay $2.5m and $5m on the first and second anniversaries of the closing, respectively.

These earnouts are not dependent on the financial performance of RotoWire, although Gambling.com Group can pay up to 50% of each of the deferred amounts in shares.

The overall purchase price is expected to be approximately four times (4x) Roto Sports’ estimated full-year revenue for 2021.

Gambling.com Group said it plans to leverage RotoWire’s existing audience, content library, workforce, media partnerships and trust with US sports fans to accelerate its US strategy.

RotoWire is a subscription based DFS content portal that boasts more than 100,000 paid subscribers and unique web visitors in excess of 17 million over the last 12 months.

I'm excited about the next evolution of RotoWire as we join forces with @gambling_group to stay on the leading edge of the new sports betting and gaming era.https://t.co/5jX8dgEa6s

— Peter Schoenke (@PeterSchoenke) December 13, 2021

Gambling.com Group CEO Charles Gillespie said the acquired business would boost the affiliate’s fiscal 2022 earnings and drive both near-term and long-term value for shareholders.

“Over the past 25 years, the RotoWire team have produced some of the best fantasy sports content in America and have in turn embedded their business into the heart of the American sports experience,” said Gillespie.

“Commercially, the RotoWire business has three different revenue streams, each generating over $1m per year, which give it significant reach into sports media organisations, as well as with advertisers and individual sports fans.

“These deep and long-lasting customer relationships are an ideal platform from which to capitalise on the new era of American sports – the betting and gaming era,” he added.

RotoWire is led by president Peter Schoenke, who is a former chairman of the Fantasy Sports & Gaming Association.

Gambling.com Group’s share price dropped 5% yesterday (13 December) to a three-month low of $9.57 per share, although the Roto Sports acquisition was announced just 15 minutes before the close of trading for the day.