Bragg Gaming Group Inc.

Good morning. My name is Rob and I will be your conference operator today. At this time, I'd like to welcome everyone to the Bragg Gaming Group fourth quarter and full year 2021 conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, again, press star 1. Thank you. Yannick Spielberg, Chief Strategy Officer, you may begin your conference.

Good morning, everyone, and thank you for joining our Broad Gaming fourth quarter and full year 2021 results. I'm joined today by my friend and colleague, Renan Kanor, and we'll be hosting today's call. So on the second page, you guys will see the forward-looking statement, and so I'd like for you all to familiarize yourself with the forward-looking statements, as some statements on this presentation will constitute forward-looking statements for the presentation. With the legalese behind us, let me talk about what we'll talk about this morning. I'll provide an overview of BRAG gaming. Then we'll talk about operational and strategic highlights. We'll then turn to business performance, product strategies, and then we'll talk about M&A, licensing and new markets, and then financials and guidance, and we'll conclude with an outlook and conclusion. And so with that, let's start with the BRAG overview. On page five, you'll see an overview of the BRAG business. BRAG is a fast-growing, vertically integrated global business-to-business gaming and content technology group. We're do listed on the Toronto Stock Exchange and NASDAQ under the same ticker, BRAG. We offer a full turnkey proprietary iGaming platform and content from our in-house studios, partner studios, and aggregated content. We're operational and licensed in Europe, North America, and LATAM. We have 286 employees pretty much around the world with offices in Toronto, Las Vegas, London, Ljubljana, in Slovenia, Malta, and soon when we close the spin acquisition, we'll also have offices in Reno and Chennai in India. We're growing really well. We currently serve over 140 customers and growing. Very excited about the future of the company and the customers that are coming on board. With that, let me turn to page six and talk about Bragg's products and services. Bragg offers platform technology, content, and services to online and omnichannel casino brands in regulated markets globally. Our technology stack is composed of our player account management system, which is a platform for only channels casinos and sport books. We also offer our remote gaming server and content distribution. And more recently, we developed player engagement tools. We named them Fuse, and it's been going quite well. Data-driven player engagement tools that are very favorable for operators. We also offer content, games from proprietary studios, which include our recent acquisition, Wild Streak, our newly founded Atomic Slot Lab, of course, Oryx Gaming, and soon to be upon closing, The Spin Games. We offer exclusive games from partner studios and, of course, aggregated gaming content from suppliers across the industry. And we'll talk about the content strategy in a few slides. We complement our technology and content offering with services. We offer managed and operational marketing services, business intelligence and software development. And so if you think about the three facets of the business, technology, content, and services taken together, Bragg offers full-term key solution, everything that is required to run an online casino operation. On the next page, we'll talk about operational and strategic highlights. It's been a very exciting fourth quarter, as you can see on page eight. Strong growth driven by new market strategy and ongoing content to platform expansion. The fourth quarter, strong financial performance. You can see the Q4 revenues rose 14% to 15.8 million euros. Q4 2021 adjusted EBITDA rose 15.4% to 1.5 million euros and our gross profit margins increased by seven base points to 51% with an adjusted EBITDA margin increased by 23% to 9.8% of the total revenue. There's also been a lot of exciting business highlights. We entered newly regulated markets in the Netherlands and we've been established as a major platform and content supplier in this market. We obtained our license to supply and launch content in the United Kingdom, which is the world's largest regulated iGaming market. We also transitioned to supplying the newly regulated German market, and the performance so far is in line with management expectation. We expect that our licenses will be given. and enforcement will start taking place, the German revenues will grow in line with the market expectation. Finally, we have some key highlights for the quarter. I want to emphasize that our new pipeline of revenue for the fourth quarter increased 500% compared to Q3 of 21. We've done significant investments in technology and content, partially to grow our North American expansion and focus on that. And we've had continued success in the integration of Wall Street and the soon-to-be spin acquisition into the broad business. With that, I'll turn to the highlights for the full year of 21, which has been a transformative year for the business and operations, M&A, and capital market strategy. In terms of financial performance, the full year 21 revenue rose 25.6% to 58.3 million euros, The adjusted EBITDA in the same period rose 30% to €7.2 million, and the gross profit margins increased by five base points to 48.6%, with the adjusted EBITDA margins increasing by 30% to 12.3% of the total revenue. It's been an exciting year. The business highlights for the year include the uplisting to the Toronto Stock Exchange in January, and then we do listed the business on the NASDAQ in August, We've also done two acquisitions, the Wall Street acquisition, which was announced and completed in June, and the spin acquisition, which was announced in May and will be completed soon. And we'll talk about that acquisition in more detail shortly. And these two acquisitions and the strategy shift accelerated our North American market entry. In the year, we've also entered five new regulated markets. with a combined total addressable market of $9.5 billion, further strengthening our growth in the online gaming space globally. The fantastic performance of the business in 2021 paved the way for a really good start for 2022, We've launched our first game from our proprietary studio, Atomic Slot Lab, Egyptian Magic. There's a slide dedicated to that with a case study, and we'll talk about it in a few slides. We also entered a new market in the Czech Republic, which is the sixth regulated market entry in the last 10 months. And of course, I'm sure for those of you who follow the story, we've obtained two new licenses in Bahamas, and the highly anticipated Ontario Market, which is planning to open April 4th to operators. Next, I'll turn to my friend and colleague, Ronan Kanor, to talk about the business performance of BRAG.

Thank you, Yaniv. Good morning, everyone. I'm turning to slide number 11. BRAG Q4 2021 revenue performance and underlying revenue, including regulated German market, was ahead of companies' expectations. Q4 2021 reported revenue was €15.8 million, which amounts over 22% above our reported guidance. The main catalyst for the underlying performance was €2.5 million from a stronger-than-expected start, from launches of new customers, mainly in the Netherlands, driven by PAM, managed services and content. €0.3 million from a better-than-expected existing customer, including recurring German regulated revenue. And whilst we gained revenue, it was kept in line with expectations. This strong underlying performance furthered strong momentum going into Q1 2022 and upgraded guidance for the full year. Now turning to slide 12. As I mentioned earlier, our entry into new markets, in particular the Netherlands, which has been exceptionally strong, coupled with new client wins, and the ramping up with operators launched earlier in the year give us a significant momentum for the coming 2022 financial year. During the quarter, the new 2021 business revenue was up by 500% from Q3 to Q4 during the new market launches. Existing customers' revenue, excluding Germany, has also seen a growth in Q4 by more than 40% on the previous quarter. And the underlying recurring group revenue, including licensed Germany, increased by 22% quarter over quarter. In the following chart, we presented the 2021 direct revenue split during the quarters. As you can see on the right-hand side, we're presenting the Q4 underlying revenue mix that is rolling into 2022 financial year, post-implementing the headwinds from Germany since the new regulated changes took place in July 2021. As a conclusion, Q4 performance further grew the foundation to drive a significant acceleration of growth in 2022 and beyond. And now back to Yaniv.