Net loss widens at Elys despite 22.0% revenue growth in 2021

Sports betting and igaming technology business Elys Game Technology posted an increased loss of $15.1m (£11.6m/€14.0m) for 2021, despite a 22.0% rise in revenue.


Total revenue for the 12 months through to 31 December 2021 amounted to $45.5m, up from $37.3m in the previous financial year and a new annual record for the business – in line with forecasts published last month.

Elys said almost all of its revenue – $44.5m – was net gaming revenue from B2C operations, while the remaining $1.0m was from betting platform and software services.

Alongside record revenue, Elys also noted an all-time high betting handle of $841.9m, up 46.6% on the previous year. Of this total, $826.8m was spent online, while $15.1m was wagered at land-based locations.

Analysing its revenue performance, Elys said it was helped by its acquisition of Bookmakers Company, the Nevada-based sports betting services provider trading as US Bookmaking (USB), to support its US growth plans.

Looking at costs for the year, operational expenses were 61.6% higher at $72.4m, a rise that came after an increase in spending in all areas of the business. Selling expenses was by far the main outgoing at $36.2m, up 38.7% year-on-year.

Elys also noted several impairment charges, including $4.8m as the result of the transition of its Ulisse CED locations in Italy to Multigioco. Most of this impairment related to the remaining value of its Ulisse Austrian bookmaking licence.

In addition, goodwill that arose on the acquisition of US Bookmaking was re-evaluated at year-end and resulted in a $12.5m impairment charge.

Higher spending offset the increase in revenue and left an operating loss of $26.9m, wider than $7.5m in the previous year. However, Elys also reported $11.5m in other income, primarily from $11.9m in the change in fair value of contingent purchase consideration, which almost entirely off set interest expenses and losses on marketable securities.

As such, this meant a pre-tax loss of $15.4m, compared to $9.0m at the end of 2021. Elys received $290,476 in income tax benefits, which meant it was left with a net loss of $15.1m, a figure wider than $9.9m in 2021.

“Our comprehensive investments in sportsbook technology continues to drive remarkable product performance and critical experiences for our engineering personnel and business operations for expansion in US and Canadian markets,” Elys executive chairman Michele Ciavarella said.

“These investments and disciplined management strategies, coupled with strong 2021 performance position Elys to improve execution efficiency and scale up quickly in 2022 by converting investments into revenue generating deployments that are expected to deliver on our 2023 goals.

“We remain fully committed to drive long-term shareholder value and are completely focused and better organised to deliver substantial sustainable growth not only in our North American go-to-market plan but all potential markets globally.”

Shortly after the year ended, Elys submitted its US gameboard sports betting platform for certification to the New Jersey Division of Gaming Enforcement.

In addition, Elys made a series of changes to its management team in January of this year, with chief financial officer Mark Korb shifting to a new corporate affairs role. Carlo Reali, Elys’ group financial controller since October 2020, replaced Korb on an interim basis, while Tory Key became US business development project leader.