Although Galaxy Gaming saw a rise in income during 2023, it still reported a deficit.
Galaxy Gaming unveiled its 2023 financial year report, revealing that the group’s income rose by 18.8% to $27.8 million (£22 million/€25.7 million), but the firm remained in a net loss situation.
Income from both land-based and digital operations increased in 2023. However, due to a number of cost increases, Galaxy Gaming experienced a net loss once more.
Chief Executive Officer and President Matt Rebuck was generally content with the mixed outcomes. Rebuck joined Galaxy in November, taking over from Todd Cravens who had guided the company since mid-2017.
When examining the results, Rebuck emphasized the income growth as a significant positive for Galaxy. He also expressed confidence about the company’s future prospects.
“We believe that 2023 marked the peak of perpetual license sales,” Rebuck stated. “We will revert to a sustainable growth model, primarily relying on our robust core and premium felt product portfolio, emerging GOS product line, and recurring revenue generated by our igaming business in 2024.
“I’ve been with Galaxy for four and a half months, and I’m very optimistic about the company’s future.”
Our intermediate-term projection outlines a strategic blueprint for attaining double-digit revenue expansion through internal expansion and potential acquisitions.
Land-based operations are the driving force behind Galaxy’s growth trajectory.
Analyzing the 2023 financial figures, GG Core’s land-based operations remain the primary revenue generator. The division’s income surged by 25.7% to $19.3 million during the year.
Galaxy attributed this growth to revenue generated from the sale of permanent licenses to clients, which reached $3.7 million, a staggering 1226.5% increase. Additional growth was attributed to revenue from new distribution agreements.
Shifting focus to GG Digital operations, revenue also experienced growth from the previous year, but at a level comparable to GG Core. Digital revenue increased by 4.8% from $8 million in 2022 to $8.4 million in the previous year.
Galaxy attributed this growth to the expansion of online customers in traditional markets and their entry into new markets.
In terms of revenue sources, the Americas generated approximately $17 million in revenue, a rise of 34.9%. An additional $10.8 million originated from Europe, the Middle East, and Africa, representing a 0.9% decrease from 2022.
Elevated spending impacts margins, net loss persists.
Turning to expenditures, operating expenses increased by 21.3% in 2023 to $21.1 million. This was primarily driven by a 25.6% increase in sales, general, and administrative expenses to $15.7 million.
Operating profit grew by 9.8% to $6.7 million. However, higher net financial-related expenses reached $8 million.
The celestial body known as Galaxy encountered a pre-tax deficit of $1.7 million in the most recent period, compared to a $1.6 million shortfall in the previous year. This resulted in an overall deficit of $5 million.
Despite contributing $79,228 in taxes, Galaxy benefited from a favorable foreign exchange conversion of $51,612, leading to a net loss of $1.8 million, similar to the previous year.
However, adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) saw a slight increase of 1.0%, reaching $10.6 million.
The final quarter reflected this trend, with Galaxy reporting a 6.4% rise in net income to $6.7 million.
GG core income surged by 18.0% to $4.6 million, while GG digital income experienced a decrease of 12.5% to $210 million.
The group recorded a net loss of $820,000 for the quarter, compared to a profit of $55,000 in 2022. Adjusted EBITDA declined by 10.0% to $280 million.