Meridian Holdings

Good day and welcome to the Golden Matrix Group second quarter 2024 earnings conference call and webcast. All participants will be in listen-only mode. So if you need assistance, please signal a conference specialist by pressing the star key followed by zero. Please note today's event is being recorded. I would now like to turn the conference over to Brett Malott, Senior Vice President of ICR. Please go ahead.

Thank you and welcome everyone to Golden Matrix Group's second quarter 2024 earnings call. Joining us today is Brian Goodman, CEO of Gold Matrix Group, and Zora Milosevic, CEO of Meridian Bet. On this call, we will review Gold Matrix financial and operating results for the second quarter of 2024. Today's call will contain forward-looking statements, and I will read some brief cautionary remarks regarding certain statements that may be made on this call. Certain statements made on this conference call and our response to various questions may constitute forward-looking information or future-oriented financial information within the meaning of the applicable security law. Statements about expected growth, prospective results, strategic outlook, and financial operating expectations, opportunities, and projections rely on several assumptions concerning future events, including market and economic conditions, business prospects or opportunity, future plan or strategy, technological development and anticipated events, trend and regulatory changes that may affect the corporation and its subsidiaries, and the respective customers' industries. While we believe these assumptions may be reasonable, they are subject to a number of risks, uncertainties, and other factors, many of which are outside the company's control. and which would cause the actual results, performance, or achievement of the company to be materially different. There can be no assurances that these assumptions or estimates are accurate or that any of these expectations will prove accurate. For complete discussion on these factors, please refer to our recently filed 10-Q, press release, and other publicly available disclosures. Non-GAAP measures will also be discussed, and reconciliation of these numbers can be found in the recently filed 10-Q and the earnings press release that can also be found on the Golden Matrix Group Investor Relations website. I will now hand the call over to Brian Goodman, CEO and co-founder of Golden Matrix Group.

Thank you and welcome everyone to our second quarter 2024 earnings call. I'm pleased to announce that this is our first earning report since our successful combination with MeridianBet. And joining me on today's call is MeridianBet CEO, Zoran Milosevic. On this call, we will review Golden Matrix's operational highlights, financial performance, divisional performance, and the overall outlook for the company. Our second quarter delivered exceptional results driven by operational success across all business units. We have maintained high performance through product diversity and cross-platform initiatives, and our dedicated team has executed on all of our short-term objectives. I am pleased to report that the consolidation of Meridian Bet has been seamless and we have gained strong momentum as a result of the recent acquisition as evidenced by our successful results since the transformation. We have now confirmed ourselves as a major player in the sports betting and iGaming industry with a robust roadmap. and we expect to continue achieving strong growth in all sectors of the business. We have not only built on historical momentum, but plan to continue to build on newfound tailwind as a result of the now completed consolidation. Before we move on to the financial highlights, I'd like to clarify some important items. Due to the relative size of the Meridian Bet business in comparison to the Golden Matrix Group, Meridian Bets was deemed the accounting acquirer. As a result, and in terms of the financial reporting, it is important to note that the financials I'm about to present are a comparison of the consolidated company's results against Meridian Bets' historical financials and performance, and not against GMGI's historical performance it is also important to note that a comparison of the consolidated company's performance against golden matrix's historical performance would have resulted in much higher growth trends and improved results however in terms of gap accounting and meridian bet being the accounting acquirer the comparisons i will present are correctly stated and are reflective of our new structure. Onto financial highlights. As I'm sure everyone is aware, sports betting and iGaming are the fastest growing segments in gaming, and we are very proud to be part of this rapidly evolving sector. We have posted strong financial performance across the business. Second quarter consolidated revenue grew 75% to $39.4 million, a continuation of the strong trend shown in the last quarter, whilst year-to-date revenue grew by 41% to $64.3 million. Net income in this quarter was $15,000. This was impacted by non-cash items as well as considerable one-off acquisition costs and restructuring and implementation costs related to the recent acquisition. Second quarter consolidated adjusted EBITDA was consistent at $5.4 million after recognizing the non-cash items, one-off costs, the completion and implementation of the Meridian Beta acquisition. Second quarter consolidated gross profits increased by 31% to $21.7 million. And year-to-date gross profits also increased by 17% to $39.4 million. Our balance sheet. The company has continued to maintain a healthy balance sheet. As at the 31st of July, the company had over $40 million in cash and equivalents. a 96% increase over December 2023 of $20.4 million. Our debt position remains healthy as well with a net debt leverage ratio of only 1.6. Shareholder equity of the company grew 52% to 89.7 million. Now turning to the business units where we have continued strong momentum. I'll begin with our high-performing tournament platform, Arkings Competitions. Arkings and its related company, GMG Assets, posted yet another record second quarter, with revenues of over $9.6 million, an increase of over 43% over last year. Players now totaled 386,000 as of 30 June 2024. And over 53,000 new players have been acquired year-to-date. Acquisition costs remain at a very low level of only $7.60 per player. Total active players now total 140,000. A remarkable total of over 5 million tickets have been sold year-to-date through 1.1 million purchases. Turning to GMAG, our B2B aggregator gaming platform. Our recent focus has been on improving our gross margins in this business unit. We are achieving this by distributing our newly acquired state-of-the-art gaming portfolio, Expand Games, to a large number of clientele. We are diversifying our overall portfolio of gains by adding the highly popular crash gains, which have shown very strong performance in both the revenue generation and high margins. Second quarter wagering grew by 124% to $1.2 billion. And year-to-date wagering also increased by a staggering 141% to $2.2 billion. Second quarter gross gaming revenue generated on the GMAG platform grew by 187% to $38 million. And year-to-date gross gaming revenue on the GMAG system grew by 186% to $68 million. We now have over 2 million active players on our GMAG system. and we continue to sign new operators on a regular basis. We are currently implementing AI tools and state-of-the-art loyalty systems into the GMAG system to improve customer retention and resultant revenues, and we expect the positive trend to continue. Now on to our MexPlay Mexican Licensed Casino. Whilst Nextplay is a relatively new casino operation, it has already shown solid growth trends. We have a monthly average of over 9,000 active players. Second quarter cash deposits increased 297% to $1.2 million. Second quarter wagering grew by 100% to $9.3 million. and gross gaming revenues grew by 154% to $422,000. I'll now hand you over to Zoran Milosevic, CEO of Meridian Bet, to talk about the Meridian Bet's results.