GiG Software PLC

Good morning. Welcome to Gig Software Q1 results presentation. I'm delighted to be joined by Richard and Phil, CEO and CFO of Gig Software. So without further ado, I will hand over to them.

Thank you. Good morning and welcome, everyone. And thank you for joining us today for Gig Software's Q1 2026 interim results presentation. My name is Richard Carter, the CEO of Gig Software, and I'm joined today by our CFO, Phil Richards. Like our previous presentations, I'll begin by reviewing our key highlights from Q1, the headline metrics and the operational achievements that have shaped the quarter. Phil will then take us through the financial review in detail, covering revenue, EBITDA, operating expenses, cash flow and our four year guidance. I'll then come back to discuss our strategic progress across our key focus areas and the outlook for the remainder of 2026. Now turning to our Q1 highlights. I'm pleased to report a solid set of results for Q1. Revenue was broadly flat year on year, with underlying existing client base of 9% offset by currency headwinds, principally the depreciation of the Argentinian peso and the timing of setup fees. We recognized 1.4 million of setup fees in quarter one last year versus 0.4 this year. We delivered our sixth consecutive quarter of positive adjusted EBITDA, which I think is a meaningful statement about the discipline we've applied to cost management across the business. On the commercial front, we signed seven new agreements year to date, reflecting continued momentum in our pipeline conversion. We also completed four successful platform launches. Our cash position amounted to 5.4 million as at the 31st of March, strengthened by the recent signing of a new revolving credit facility of up to 3 million. In addition to this, we have now entered, we've now enacted 4.5 million in annualized cost savings, the impact of which will be seen from Q2 onwards. These results, coupled with our ongoing commercial developments, give us confidence in our ability to meet our four year guidance. I will now hand over to Phil to walk you through the numbers in more detail.

Thank you, Richard. Good morning, everyone. I'll now take you through the financial performance for Q1 2026. Starting with revenue and EBITDA, Q1 2026 revenue was broadly in line with Q1 2025, a 2% decline on a reported basis, however, up slightly on a constant currency basis. When excluding one-off setup fees, our underlying revenue growth mounted to 9% year-on-year. Our revenue mix continues to be well balanced with 56% from minimum guarantees and 44% from revenue share. Our adjusted EBITDA came in at 0.2 million compared to 0.4 million in Q1 2025 with a small year-on-year movement driven entirely by the revenue variance as the cost base remained flat. As a reminder, Q1 is historically our most seasonally challenging quarter and its performance is consistent with our expectations and with our four-year guidance. This slide walks through the moving parts of revenue year on year. Existing customer growth was strong. Platform revenue from existing clients grew 15% year on year. Sportsbook revenue from existing clients grew 18% year on year. And our underlying revenue growth from our top 10 customers was also 18%, which is a clear indication that our core client base is performing well. New launches and customer growth contributed to 0.9 million to revenue in the period. These positives were offset by both the 0.3 million constant currency headwind from the Argentinian peso and the net setup fee movement reflecting Q1 2025 benefiting from some one-off fees that did not occur in 2026. Moving now to operating expenses, these were flat year on year and I'm pleased to say we've now delivered 4.5 million in annualized cost savings in Q1 2026 in line with our original targets, with these savings being realized in Q2 and beyond. Personnel costs have been the primary driver of savings and we continue to review our cost base to further reduce this and therefore realize the scalability inherent in the business. This cost discipline combined with ARR growth is what underpins our confidence in achieving positive underlying cash generation through 2026. This waterfall chart shows the bridge from Q1 2025 adjusted EBITDA of 0.4 million to Q1 2026 adjusted EBITDA of 0.2 million. The 0.2 million movement reflects a 100% drop through of the revenue variance, with cost lines essentially flat. This demonstrates the way we do see revenue growth, particularly from existing clients. It flows directly through to EBITDA. We had share-based compensation of 0.1 million and excretion payments of 0.4 million, and these are excluded from our adjusted EBITDA, which is consistent with our prior reporting. On cash now, we ended Q1 2026 with 5.4 million in cash, down from 9.9 million as of 31 December 2025. Q1 is historically our period of highest cash outflow due to seasonal working capital patterns and annual payments. Operational cash flow, excluding working capital movements, improved by approximately 0.6 million year-on-year and we continue to move towards cash flow break-even. I'm pleased that we've strengthened our cash position by the addition of a new revolving credit facility of up to 3 million following the end of the quarter. I'm also pleased to reiterate our full year 2026 financial guidance. We're targeting revenue of at least 44 million and adjusted EBITDA of at least 10 million. We continue to make progress towards generating positive underlying cash flow from operations as we previously committed. Our guidance is underpinned by 12 to 14 planned launches during the year, four of which have already been completed. And as you can see from the revenue composition chart, launch activity is way towards H2, which is consistent with the profile we've communicated previously. I'm now going to hand you back to Richard for the strategic update.

Thank you, Phil. I'd now like to turn to our strategic priorities for 2026 and beyond. Let me start with two of our most exciting growth opportunities. First, the opening of the regulated Alberta market in July provides a strong opportunity for Gigg to deploy its regulated market solution from day one with a number of our existing clients, including Casino Time, Lucky Days and Power Play, all well positioned to enter the market when it opens from mid-July onwards. Alberta is a compelling market and is estimated to reach a market size of just under 2 billion Canadian dollars by 2030, with a projected compound annual growth rate of 17% between 2027 and 2030. We are also in active discussions with several other operators for additional launches in the province. This highlights the benefit of our multi-jurisdictional approach and the strength and flexibility of our technology solutions. Secondly, our sportsbook, which delivered 18% revenue growth in Q1 and was our fastest growing vertical. With the FIFA World Cup on the horizon, the biggest ever edition with 104 matches, and kick-off times well aligned with our Latin American clients, we see the potential for a significant near-term tailwind. Moving to our Spanish business and AI. In Spain, we are making excellent progress towards transitioning clients from our Alira platform to Corex. Golden Park, Paston, and Pause and Play have all signed migration agreements, which now means all but one client has agreed to migrate, and we anticipate that this remaining Spanish client will agree terms over the coming months. Towards the end of 2026, we are scheduled to largely complete this transitioning of clients, and this will lead to ongoing operational efficiencies, as well as significant cost savings, as previously disclosed. Now turning to AI, a sizable proportion of our 4.5 million in cost savings has been driven through the adoption of AI throughout the organization. And we are not standing still, with our focus now shifting to broader agentic AI deployment across the company. This next slide, which we've shared previously, sets out our AI roadmap for 2026. And I'm genuinely excited about what we're building here. In Q2, we're advancing AI integrations into casino and sports product features and extending gig assistant functionality into incident management and customer support. In Q3 and Q4, we'll move into full agentic AI deployment across the business, reducing time to market, improving code quality and driving operational efficiency at scale. The long-term vision here is clear, AI embedded across every layer of our platform, from delivery to player engagement, driving sustainable efficiency gains and revenue growth for both gig and our clients. To summarize, Q1 2026 was a solid operational quarter. We delivered our sixth consecutive quarter of positive EBITDA. executed four launches, strengthened our cash position with the addition of a new 3 million revolving credit facility and continued to grow our existing client base strongly. We are on track to meet our full year guidance of 44 to 48 million in revenue and 10 to 13 million in adjusted EBITDA and we continue to make significant progress towards generating positive underlying cash from operations. Now, looking further ahead, we have clear and compelling growth levers. The Alberta market launch, our sports book, aided in the short term by the largest ever FIFA World Cup, and the completion of our ALERA transition and the progressive rollout of AI across the business. Our executive committee is also actively reviewing strategic investment and M&A opportunities, and we are confident in GIG's long-term growth prospects. Thank you for joining us, and I'm now happy to take any questions.

That's great. Thank you very much indeed for updating, investors. Ladies and gentlemen, please do continue to submit your questions just using the Q&A tab situated on the right-hand corner of the screen. Just while the team take a few moments to review the questions submitted already, I'd just like to remind you recording this presentation along with a copy of the slides and the published Q&A will be available via your InvestingMe company platform. Lorne, if I may just hand back to you just to manage us through the Q&A, and I'll pick up from you at the end.

Yes, of course. Thank you very much. Okay, the first question is what proportion of revenues are highly recurring versus transactional or project-based?

So it's really, this is one of the great stories about Q1 is that a significant proportion of revenues are highly recurring. Richard mentioned that we only had 0.4 million of setup fees during the quarter with the underlying revenue aside from that being recurring. So that's That's kind of where the story is evolving when we're talking about the ARR growth year on year. That's really our focus. It's making sure that we have this ARR base that we can rely upon for revenues going forwards. And we're not relying on the one-offs, the setup fees and things like that. It's the quality of revenue coming through that's a real focus for us.

That's marvellous. Second question, can you tell us a bit more about Jupiter Gaming, the timeline of the launches and the potential with them as a partner?

Yeah, I think we put out an announcement a few months about that group and we talked about launching the second half of this year. I'm very pleased to say that we've just recently launched a couple of brands with them so one is on our sports book and then we've also done some migration so effectively we're well ahead of the timelines there so we brought that forward by sort of three or four months and huge congratulations to the team who really went above and beyond to get that client live so I think that's a very exciting story and obviously holds us in good shape for the second half of the year.

One to watch. The underlying revenue growth is encouraging at 9%. Are there any particular call-outs around geographies or clients?

Well, we actually talked about our top 10 growing 18% year on year. So it's really the main customers that are the big shout outs. They're the ones that are growing very well. And that's actually quite consistent across quite a few geographies. LATAM is a good area of growth for us there. We've got some very significant partners in, for example, in Argentina and in Peru that are growing very nicely as well. But overall, What I'm really pleased about is how well these top customers are performing. They're really the ones driving this underlying growth.

Fantastic. And how is the launch for the European Lottery client progressing?

Yeah, we're working on that. That's still anticipated to be the second half of the year, probably Q4. But that's progressing well, thank you.

Next question, you've shown good progress in Sportsbook. How are you thinking about further growth in that vertical?

Well, it's a combination of growing obviously by new product, new features from our existing client base, which obviously, you know, we saw some very strong growth there in Q1. And as I just mentioned, Jupiter Gaming's launched a sports brand. The idea is that they will probably add sports that are other brands that they're going to migrate looking forward. So it's a combination of we've got some good launches in the pipeline as well. So it's a combination of new launches and obviously existing growth from our existing customer base. As we alluded to this morning, obviously we have this World Cup approaching and barring any crazy results, it's going to be a significant acquisition opportunity for our Sportsbook customers. And that will hopefully also start to resonate through the second half of the year into 2027.

Marvelous. Can you tell us about what you're seeing in the UK post the increase in duty? Are you seeing weaker operators exit the market or are customers mainly looking to consolidate into fewer partners?

I think it's still very early days. I think if you actually look at, I think there's been quite a lot of articles actually written over the last sort of seven days actually and a few operators have actually released and I think so far it's not been as negative as expected, but again, I think it's very early days, and I think we'll have to wait for that to play out in the second half of the year.

Yeah, something to watch. I think that's the end of the questions for this morning.

Okay. I'd just like to thank everyone for joining us today and participating in the call, and we look forward to updating you on our Q2 results in August. Thank you.

That's great. Thank you very much indeed, ladies and gentlemen, for joining us this morning. That concludes today's presentation. We will now redirect you for your feedback. Thank you once again for your time this morning.