Le Lézard
Classified in: Business, Sports and recreation, Covid-19 virus
Subjects: EARNINGS, Conference Call, Webcast

Super Group Reports First Quarter 2022 Financial Results


Super Group (SGHC) Limited (NYSE: SGHC) ("SGHC" or "Super Group"), the parent company of Betway, a leading online sports betting and gaming business, and Spin, the multi-brand online casino, today announced first quarter 2022 financial results for its operating subsidiary, SGHC Limited.

Super Group completed a business combination on January 27, 2022, with Sports Entertainment Acquisition Corp. ("SEAC") as a result of which all of the shareholders of SGHC Limited also exchanged their shares for shares of Super Group in a pre-closing reorganization. Prior to January 27, 2022, SGHC did not conduct any operations other than incurring costs to effect the reorganization and business combination.

Neal Menashe, CEO of Super Group, commented: "During the first quarter of 2022, Super Group began operating as a U.S. publicly listed company and continued to expand in both existing and new markets in line with our growth strategy." Mr. Menashe continued, "Our team has become accustomed to navigating the business through changing and challenging environments, and we believe the strategies that we are executing on will enable us to continue doing so as we take Super Group from strength to strength."

Alinda van Wyk, CFO of Super Group commented, "The results for the first quarter of 2022 reflected revenue growth and strong cash generation but were challenged on a period over period comparative basis due to industry and economic headwinds and costs related to our business combination and listing as a public company in January. Ms. van Wyk stated, "Despite tough period over period comparisons, Super Group experienced revenue growth and a period over period 39% increase in cash and cash equivalents."

Financial Highlights

The transaction fees and share listing expense are one-time costs.

Business Highlights

Geographical Information for the Three Months Ended March 31

 

 

2022

 

2022

 

2022

Betway

 

Spin

 

Total

? '000s

 

? '000s

 

? '000s

Africa and Middle East

63,786

1,337

65,123

Asia and Pacific

55,250

23,989

79,239

Europe

30,192

2,525

32,717

North America

34,467

115,984

150,451

South/Latin America

3,285

3,663

6,948

 

186,980

147,498

334,478

 

%

%

%

Africa and Middle East

34%

1%

19%

Asia and Pacific

30%

16%

24%

Europe

16%

2%

10%

North America

18%

79%

45%

South/Latin America

2%

2%

2%

 

 

2021

 

 

2021

 

 

2021

 

Betway

 

Spin

 

Total

 

? '000s

 

? '000s

 

? '000s

Africa and Middle East

40,624

1,591

42,215

Asia and Pacific

40,592

27,352

67,944

Europe

37,771

8,697

46,468

North America

34,036

114,661

148,697

South/Latin America

2,811

3,676

6,487

 

155,834

155,977

311,811

 

%

 

%

 

%

Africa and Middle East

26%

1%

14%

Asia and Pacific

26%

18%

22%

Europe

24%

6%

15%

North America

22%

73%

47%

South/Latin America

2%

2%

2%

Disaggregation of Revenue by Product Line

 

For the Three Months ended March 31, 2022:

 

 

 

 

Betway

 

Spin

 

Total

 

? '000s

 

? '000s

 

? '000s

Online casino

57,456

147,046

204,502

Sports betting

109,037

452

109,489

Brand licensing

19,890

?

19,890

Other

597

?

597

Total Group revenue

186,980

147,498

334,478

 

For the Three Months ended March 31, 2021:

 

 

 

 

Betway

 

Spin

 

Total

 

? '000s

 

? '000s

 

? '000s

Online casino

55,566

154,913

210,479

Sports betting

82,905

1,064

83,969

Brand licensing

17,363

?

17,363

Total Group revenue

155,834

155,977

311,811

Reorganization Timeline

Over the last three years, the business conducted a restructuring by combining existing, stand-alone companies into the newly formed Super Group. The only acquisition affecting the periods presented in this press release is Raging River, acquired on January 11, 2021.

SGHC Limited was formed on July 6, 2020.

The following transactions took place during 2019, 2020, 2021 and 2022 as part of the reorganization:

Non-GAAP Financial Information

This press release includes non-GAAP financial information not presented in accordance with the International Financial Reporting Standards ("IFRS").

EBITDA and Adjusted EBITDA are non-GAAP company-specific performance measures that Super Group uses to supplement the Company's results presented in accordance with IFRS. EBITDA is defined as profit before depreciation, amortization, financial income, financial expense and income tax expense/credit. Adjusted EBITDA is defined as EBITDA less gain on derivative contracts and gain on bargain purchase plus transaction costs, share listing expense and fair value adjustments on warrant liabilities and earnout liabilities.

Super Group believes that these non-GAAP measures are useful in evaluating the Company's operating performance as they are similar to measures reported by the Company's public competitors and are regularly used by securities analysts, institutional investors and other interested parties in analyzing operating performance and prospects.

Management does not consider these non-GAAP measures in isolation or as an alternative to financial measures determined in accordance with IFRS. The principal limitation of these non-GAAP financial measures is that they exclude significant expenses that are required by IFRS to be recorded in Super Group's financial statements. In order to compensate for these limitations, management presents non-GAAP financial measures together with IFRS results. Non-GAAP measures should be considered in addition to results and guidance prepared in accordance with IFRS, but should not be considered a substitute for, or superior to, IFRS results.

Reconciliation tables of the most comparable IFRS financial measure to the non-GAAP financial measures used in this press release are included below. Super Group urges investors to review the reconciliation and not to rely on any single financial measure to evaluate its business. In addition, other companies, including companies in our industry, may calculate similarly named non-GAAP measures differently than we do, which limits their usefulness in comparing our financial results with theirs.

 

Reconciliation of Profit to Adjusted EBITDA for the Three Months Ended March 31:

 
 

 

 

2022

 

2021

 

 

 

? '000s

 

? '000s

 

 

Profit (Loss) for the period

 

 

(163,222

 

)

 

38,571

 

 

Income tax expense

 

8,959

 

2,920

 

Finance income

 

(313

)

(338

)

Finance expense

 

349

 

2,879

 

Depreciation and amortization expense

 

15,990

 

20,022

 

EBITDA

 

(138,237

)

64,054

 

Transaction costs

 

21,405

 

?

 

Gain on derivative contracts

 

(1,712

)

?

 

Share listing expense

 

126,252

 

?

 

Fair value ? warrant liability

 

29,374

 

?

 

Fair value ? earnout liability

 

24,385

 

?

 

Gain on bargain purchase

 

?

 

(10,047

)

Adjusted EBITDA

 

61,467

 

54,007

 

 

 

 

 

 

 

Webcast Details

The Company will host a webcast at 8:30 a.m. ET today to discuss the first quarter 2022 financial results. For ease of year-over-year comparison and analysis the Company may discuss pro-forma consolidated results, including Adjusted EBITDA, which pro-forma results are included in the 2022 Earnings Review presentation posted on Investor Relations section of SGHC.com.

Participants may access the live webcast and supplemental earnings presentation on the events & presentations page of the Super Group Investor Relations website at:
https://investors.sghc.com/events-and-presentations/default.aspx.

About Super Group (SGHC) Limited

Super Group (SGHC) Limited is the holding company for leading global online sports betting and gaming businesses: Betway, a premier online sports betting brand, and Spin, a multi-brand online casino offering. The group is licensed in multiple jurisdictions, with leading positions in key markets throughout Europe, the Americas and Africa. The group's sports betting and online gaming offerings are underpinned by its scale and leading technology, enabling fast and effective entry into new markets. Its proprietary marketing and data analytics engine empowers it to responsibly provide a unique and personalized customer experience. For more information, visit www.sghc.com.

Forward-Looking Statements

Certain statements made in this press release are "forward looking statements" within the meaning of the "safe harbor" provisions of the United States Private Securities Litigation Reform Act of 1995.

These forward-looking statements include, but are not limited to, expectations and timing related to market entries and expansion, projections of market opportunity and growth, expected growth of Super Group's customer base, expansion into new markets and receipt of regulatory approvals.

These forward-looking statements generally are identified by the words "believe," "project," "expect," "anticipate," "estimate," "intend," "strategy," "future," "opportunity," "plan," "pipeline," "may," "should," "will," "would," "will be," "will continue," "will likely result," and similar expressions. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Many factors could cause actual future events to differ materially from the forward-looking statements in this press release, including but not limited to: (i) the ability to implement business plans, forecasts and other expectations, and identify and realize additional opportunities; (ii) the ability to maintain the listing of Super Group's securities on a national securities exchange; (iii) changes in the competitive and regulated industries in which Super Group operates; (iv) variations in operating performance across competitors; (v) changes in laws and regulations affecting Super Group's business; (vi) Super Group's inability to meet or exceed its financial projections; (vii) changes in general economic conditions, including as a result of the COVID-19 pandemic; (viii) changes in domestic and foreign business, market, financial, political and legal conditions; (ix) future global, regional or local economic and market conditions affecting the sports betting and gaming industry; (x) changes in existing laws and regulations, or their interpretation or enforcement, or the regulatory climate with respect to the sports betting and gaming industry; (xi) the ability of Super Group's customers to deposit funds in order to participate in Super Group's gaming products; (xii) compliance with regulatory requirements in a particular regulated jurisdiction, or Super Group's ability to successfully obtain a license or permit applied for in a particular regulated jurisdiction, or maintain, renew or expand existing licenses; (xiii) the technological solutions Super Group has in place to block customers in certain jurisdictions, including jurisdictions where Super Group's business is illegal, or which are sanctioned by countries in which Super Group operates from accessing its offerings; (xiv) Super Group's ability to restrict and manage betting limits at the individual customer level based on individual customer profiles and risk level to the enterprise; (xv) the ability by Super Group's key executives, certain employees or other individuals related to the business, including significant shareholders, to obtain the necessary licenses or comply with individual regulatory obligations in certain jurisdictions; (xvi) protection or enforcement of Super Group's intellectual property rights, the confidentiality of its trade secrets and confidential information, or the costs involved in protecting or enforcing Super Group's intellectual property rights and confidential information; (xvii) compliance with applicable data protection and privacy laws in Super Group's collection, storage and use, including sharing and international transfers, of personal data; (xviii) failures, errors, defects or disruptions in Super Group's information technology and other systems and platforms; (xix) Super Group's ability to develop new products, services, and solutions, bring them to market in a timely manner, and make enhancements to its platform; (xx) Super Group's ability to maintain and grow its market share, including its ability to enter new markets and acquire and retain paying customers; (xxi) the success, including win or hold rates, of existing and future online betting and gaming products; (xxii) competition within the broader entertainment industry; (xxiii) Super Group's reliance on strategic relationships with land based casinos, sports teams, event planners, local licensing partners and advertisers; (xxiv) events or media coverage relating to, or the popularity of, online betting and gaming industry; (xxv) trading, liability management and pricing risk related to Super Group's participation in the sports betting and gaming industry; (xxvi) accessibility to the services of banks, credit card issuers and payment processing services providers due to the nature of Super Group's business; (xxvii) the regulatory approvals related to Super Group's acquisition of DGC; (xxviii) the integration of the DGC business; and (xxix) other risks and uncertainties indicated from time to time for Super Group including those under the heading "Risk Factors" in our Annual Report on Form 20-F filed with the SEC on April 20, 2022, and in Super Group's other filings with the SEC. The foregoing list of factors is not exhaustive. You should carefully consider the foregoing factors and the other risks and uncertainties described in other documents filed or that may be filed by Super Group from time to time with the SEC. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Forward-looking statements speak only as of the date they are made. Readers are cautioned not to put undue reliance on forward-looking statements, and Super Group assumes no obligation and does not intend to update or revise these forward-looking statements, whether as a result of new information, future events, or otherwise. Super Group does not give any assurance that it will achieve its expectations.

 

SGHC Limited

Unaudited Interim Condensed Consolidated Statements of Profit or Loss

and Other Comprehensive Income

for the three months ended March 31, 2022 and 2021

 

 

2022

 

2021

? '000s

? '000s

Revenue

334,478

 

 

311,811

 

Direct and marketing expenses

(240,717

)

 

(214,449

)

Other operating income

2,407

 

 

263

 

General and administration expenses

(34,701

)

 

(43,618

)

Depreciation and amortization expense

(15,990

)

 

(20,022

)

Transaction fees

(21,405

)

 

?

 

Profit from operations

24,072

 

 

33,985

 

Finance income

313

 

 

338

 

Finance expense

(349

)

 

(2,879

)

Gain on derivative contracts

1,712

 

 

?

 

Share listing expense

(126,252

)

 

?

 

Change in fair value of warrant liability

(29,374

)

 

?

 

Change in fair value of earnout liability

(24,385

)

 

?

 

 

 

 

 

Gain on bargain purchase

?

 

 

10,047

 

(Loss)/profit before taxation

(154,263

)

 

41,491

 

Income tax expense

(8,959

)

 

(2,920

)

(Loss)/profit for the period attributable to owners of the parent

(163,222

)

 

38,571

 

Other comprehensive income

 

 

 

Items that may be reclassified subsequently to profit or loss

 

 

 

Foreign currency translation

1,117

 

 

526

 

Other comprehensive income for the period

1,117

 

 

526

 

Total comprehensive (loss)/profit for the period attributable to owners of the parent

(162,105

)

 

39,097

 

 

 

 

 

Weighted average shares outstanding, basic and diluted

488,324,769

 

 

460,395,838

 

(Loss)/Net profit per share, basic and diluted

(0.33

)

 

0.08

 

 

SGHC Limited

Unaudited Interim Condensed Consolidated Statements of Financial Position

as at March 31, 2022 and December 31, 2021

 

 

2022

2021

ASSETS

? '000s

? '000s

Non?current assets

Intangible assets

165,904

 

172,954

 

Goodwill

25,003

 

25,023

 

Property, plant and equipment

13,707

 

12,498

 

Right?of?use assets

13,887

 

14,541

 

Deferred tax assets

29,422

 

24,108

 

Regulatory deposits

8,980

 

8,594

 

Loans receivable

7,500

 

25,516

 

Financial assets

1,686

 

1,686

 

 

266,089

 

284,920

 

Current assets

 

 

Trade and other receivables

167,154

 

169,252

 

Income tax receivables

33,923

 

35,806

 

Restricted cash

88,231

 

60,296

 

Cash and cash equivalents

272,684

 

293,798

 

 

561,992

 

559,152

 

TOTAL ASSETS

828,081

 

844,072

 

Non?current liabilities

 

 

Lease liabilities

10,938

 

10,896

 

 

 

 

 

 

 

Deferred tax liability

9,634

 

9,248

 

Interest?bearing loans and borrowings

532

 

764

 

 

21,104

 

20,908

 

Current liabilities

 

 

Earnout liability

274,340

 

?

 

Warrant liability

76,489

 

?

 

Lease liabilities

4,807

 

5,353

 

Deferred consideration

?

 

13,200

 

Shareholders' repurchase payable

44,311

 

?

 

Interest?bearing loans and borrowings

3,294

 

3,008

 

Trade and other payables

150,561

 

147,353

 

Customer liabilities

52,883

 

51,959

 

Provisions

47,920

 

47,715

 

Income tax payables

47,708

 

40,524

 

 

702,313

 

309,112

 

TOTAL LIABILITIES

723,417

 

330,020

 

EQUITY

 

 

Issued capital

273,436

 

269,338

 

Earnout reserve

(249,955

)

?

 

Foreign exchange reserve

(977

)

(2,094

)

Retained profit

82,160

 

246,808

 

TOTAL EQUITY

104,664

 

514,052

 

 

 

 

TOTAL LIABILITIES AND SHARHOLDERS' EQUITY

828,081

 

844,072

 

 

SGHC Limited

Unaudited Interim Condensed Consolidated Statements of Cash Flows

for the three months ended March 31, 2022 and 2021

     

 

2022

 

2021

 

? '000s

 

? '000s

Cash flows from operating activities

 

(Loss)/profit for the period

(163,222

)

38,571

 

Add back:

 

 

 

Income tax expense

8,959

 

2,920

 

Loss on disposal of assets

?

 

(7

)

Fair value ? warrant liability

29,374

 

?

 

Fair value ? earnout liability

24,385

 

?

 

Share listing expense

126,252

 

?

 

Depreciation of property, plant and equipment

1,323

 

587

 

Waiver of loans

?

 

462

 

Gain on bargain purchase

?

 

(10,047

)

Amortization of right?of?use assets

1,162

 

542

 

Amortization of intangible assets

13,505

 

18,893

 

Increase in provisions

387

 

255

 

Finance income

(313

)

(338

)

Finance expense

242

 

2,770

 

Unrealized foreign currency (loss)/gain

(1,688

)

2,483

 

Changes in working capital:

 

 

 

Decrease in trade and other receivables

2,289

 

19,161

 

Decrease in trade and other payables

(20,128

)

(17,083

)

Increase in customer liabilities

924

 

6,302

 

Change in restricted cash

(731

)

(1,169

)

Cash from operating activities

22,720

 

64,302

 

Dividends tax paid

(5,461

)

(154

)

Corporation tax rebates received

1,846

 

2,387

 

Corporation tax paid

(1,422

)

(3,292

)

Net cash flows from operating activities

17,683

 

63,243

 

Cash flows from investing activities

 

 

 

Cash received in interest

237

 

200

 

Acquisition of intangible assets

(6,252

)

(3,628

)

Acquisition of property, plant and equipment

(2,533

)

(524

)

Acquisition of businesses, net of cash acquired

-

 

10,301

 

Restricted cash guarantee

(27,204

)

?

 

Receipts from loans receivable

17,541

 

1,041

 

Issuance of loans receivable

(6

)

(25

)

Cash used in regulatory deposits

(386

)

(463

)

Net cash flows from investing activities

(18,603

)

6,902

 

Cash flows used in financing activities

 

 

 

Shares repurchased

(179,985

)

(10,733

)

Capitalized transaction fees

(1,488

)

-

 

Proceeds from shares issued

172,119

 

-

 

Cash paid for deferred consideration

(13,200

)

?

 

Repayment of interest?bearing loans and borrowings

(349

)

(1,932

)

Repayment of lease liabilities ? interest

(261

)

(352

)

Repayment of lease liabilities ? principal

(1,186

)

(1,027

)

Net cash flows used in financing activities

(24,350

)

(14,044

)

(Decrease)/increase in cash and cash equivalents

(25,270

)

56,101

 

Cash and cash equivalents at beginning of the period

293,798

 

138,540

 

Effects of exchange rate fluctuations on cash held

4,156

 

1,553

 

Cash and cash equivalents at end of the period

272,684

 

196,194

 

.


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News published on 25 may 2022 at 07:35 and distributed by: