Kambi Group plc

Q1 earning call. At this time, all participants are in the listen-only mode. After the speaker presentations, there will be time for questions and answers. If you're following us on the teleconference and wish to ask a question, please press star 1-1. If you're following us through the webcast, you may submit your questions through the chat. Please be advised that today's conference is being recorded. So the agenda for today, we will start with some highlights from Werner, which will be followed by the financial summary by David Kenyon, and then Werner will come back with some operational updates. Following this, there will be time for the Q&A. With that, I would like to hand over the conference to you, Werner. Please go ahead.

Thanks, Mattias, and good morning. Our progress in Q1 represents a strong start to the year with an improved financial performance and continued commercial momentum. The quarter saw its return to growth with revenue up 5% and EBITDA up 64%, which David will walk through in more detail shortly. Hopefully you've already seen this morning, we were announced as the winning bidder and signed a contract for the Canadian National Sports Betting Solution, which will see us add another seven provinces to our recent partnership with Ontario Lottery, giving us a strong position in Canada. This follows on from our turnkey sports book partnership with PMU in France, which we signed and launched at the end of the quarter. And we continue to expand our odds feed plus signing with ComeOn and deepening our partnership with HardRock in the United States.

Thank you, Werner. Good morning, everyone. Let me start with the headline numbers for Q1. So we delivered revenue of 43.5 million, which is up year on year versus 41.5 million last year. Operating expenses were 31.9 million, down from 32.6 million in the prior year quarter. That operating discipline translated into a strong step up in profitability. Adjusted earnings before interest tax and amortization on acquisitions, or EBITAC as I'll call it, came in at 5.7 million, up from 3.5 million last year, a meaningful improvement in our profit. The important point here is that we're growing the top line while keeping a tight grip on cost. so the incremental revenue is dropping through and increasing our profitability. One quick technical note, the definition of adjusted EBITDA has been updated to exclude foreign exchange revaluations, so you can think of these numbers as a cleaner view of underlying performance. Turning to our operator trading dynamics, where we monitor the underlying level of activity in the network on the turnkey sportsbook, which is the main revenue driver in the business. The turnover index gives you a view of overall betting turnover volumes, originally indexed at 100 when we listed. And the orange line shows the aggregate operator trading margin across the network. The operator turnover index this quarter was 715. As expected and seen each year, due to seasonality of the sporting calendar, this was a slight decrease from Q4, where we had a full quarter of the NFL season. This was partially offset by the launch of our new customer, Ontario Lottery and Gaming. Versus Q1 last year, Kindred's exits from various markets and the negative impact of a weaker US dollar were offset by organic growth of our operators, particularly in a number of LATAM markets and the launches of a number of new customers, resulting in a 3% year-on-year turnover decrease. The operator trading margin was also much higher this year, at 11.6%. which also depressed the level of turnover relative to Q1 last year. We saw particularly strong margins in football and college basketball. The next slide walks through the year-on-year change in adjusted EBITDA. This bridge explains what drove the move from 3.5 million last Q1 to 5.7 million this quarter. At a high level, the biggest driver is the operating leverage, with revenue growth flowing through while the cost base stayed controlled. The first two lighter blue columns together comprise the organic growth of the business, split out between the turnover and increased margin, which, as I mentioned, are interdependent. This organic growth is coming particularly from our operators in LATAM, as well as the higher operator trading margin, which was even above the full year expectation of 11% we set out last quarter. Our launches comprise a number of new operators across both turnkey and front-end services, including OLG, as well as new Oddspeed Plus customers. The migrations column include Kindred exiting the UK and Romanian markets last year. The gaming tax and other column includes the year-on-year impact of revised commission rates with certain of our customer contract renewals, and additional tax in Colombia, where we had two different taxes this quarter, impacting January and March. compared to one month of tax impact on Q1 2025. There were also other gaming tax increases in jurisdictions such as the Netherlands and Brazil. Our cost of sales increased as our revenue and number of new customers grew, whilst our operating expenses were down as we saw the impact from our savings programme with reductions across many of our cost lines. The main FX impact at constant currency was a 0.8 million reduction in the value of revenues mainly from the US due to the weaker dollar versus Q1 last year. All of this resulted in a 64% increase in our adjusted EBITDA to 5.7 million. I'll finish with the cash flow in the quarter. This slide summarizes the main movements, looking at three things here. The cash generation from operating performance, the working capital effects in the period, and then any investing and financing impacts. So operating profit for the quarter was 4.2 million. Our working capital position improved in the quarter as we caught up on receiving certain large customer payments. During the quarter, we also set aside 9.4 million in a standby letter of credit contractually required by a new customer. And that's the large orange column you see there. That money is set aside for any contractual requirements during that contract. We also used 4.5 million in the quarter to carry out share buybacks in line with the buyback program announced in November last year. And this will run until the AGM in May. All of this leaves a closing cash balance of 31.5 million at the end of March. With that, I hand back to Werner.