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Gaming Innovation Group

Gaming Innovation Group

Casino and sports betting services

GIG is a young company that sells products to a large part of the online gambling value chain. It sells marketing services to other gambling operators and sells its own software platform and sportsbook to other B2C operators, as well as land-based casinos, enabling them to offer casino and sports betting services. GIG’s footprint is in Western Europe, but it also has US exposure through selling B2B services.

GIG’s opportunity within its B2B platform and affiliate business is to expand the operations by increasing the geographic footprint. Furthermore, there are M&A opportunities present in the affiliate segment.

We see regulatory risks (the firm could face litigation if it fails to comply with local laws and practices in the regions where it operates) and counterparty risk (it faces many counterparties and some customers on the B2B side are smaller firms with low levels of solidity). Although the SEK 450 million bond has been refinanced with more favourable terms and matures in 2024, this still means that there are some financial risks involved.

EURm 2020 2021e 2022e
Sales 83 80 88
Sales growth (%) -32,6 -4 10
EBITDA 17 22 27
EBITDA margin (%) 20,6 28,1 30,8
EBIT adj -2 10 14
EBIT adj margin (%) -3 12,1 16,2
Pretax profit -9 2 11
EPS rep -0,11 0,03 0,1
EPS growth (%) 85 132,3 196,3
EPS adj -0,11 0,03 0,1
DPS 0 0 0
EV/EBITDA (x) 7,9 9,7 7,6
EV/EBIT adj (x) -54,5 22,7 14,4
P/E (x) -11,1 56,4 19
P/E adj (x) -11,1 56,4 19
EV/sales (x) 1,6 2,7 2,3
FCF yield (%) 30,1 0,9 3,5
Dividend yield (%) 0 0 0
Net IB debt/EBITDA 1,6 1,5 0,5
Lease adj. FCF yield (%) 27,5 -0,6 2
Lease adj. ND/EBITDA 2 1,6 0,5
EURm 2020 2021e 2022e
Leasing payments -3 -3 -3
Sales 83 80 88
COGS -9 -4 -4
Gross profit 74 76 84
Other operating items -57 -53 -57
EBITDA 17 22 27
Depreciation on tangibles -2 -2 -4
Depreciation on intangibles -14 -12 -9
EBITA -2 10 14
Goodwill impairment charges 0 0 0
Other impairment and amortisation 0 0 0
EBIT -2 10 14
Other financial items 0 0 0
Net financial items -7 -8 -3
Associated income 0 0 0
Other EO items 0 0 0
Pretax profit -9 2 11
Tax 0 1 -1
Net profit -10 3 10
Minority interest 0 0 0
Net profit discontinued 0 0 0
Net profit to shareholders -10 3 10
EPS -0,11 0,03 0,1
EPS Adj -0,11 0,03 0,1
Total extraordinary items after tax 0 0 0
Tax rate (%) 3,5 55 -7,4
Gross margin (%) 88,8 95,2 95,7
EBITDA margin (%) 20,6 28,1 30,8
EBITA margin (%) -3 12,1 16,2
EBIT margin (%) -3 12,1 16,2
Pretax margin (%) -11,3 2,6 12,3
Net margin (%) -11,7 4,1 11,4
Growth rates Y/Y 2020 2021 2022
Sales growth (%) -32,6 -4 10
EBITDA growth (%) 156,9 31,4 20,4
EBIT growth (%) 95,5 487,9 47,3
Net profit growth (%) 85 133,7 204,8
EPS growth (%) 85 132,3 196,3
Profitability 2020 2021 2022
ROE (%) -75 35,3 50,1
ROE Adj (%) -75 35,3 50,1
ROCE (%) -9,5 5,7 21,6
ROCE Adj(%) -9,5 5,7 21,6
ROIC (%) -3,5 25,9 20,7
ROIC Adj (%) -3,5 25,9 20,7
Adj earnings numbers 2020 2021 2022
EBITDA Adj 17 22 27
EBITDA Adj margin (%) 20,6 28,1 30,8
EBITA Adj -2 10 14
EBITA Adj margin (%) -3 12,1 16,2
EBIT Adj -2 10 14
EBIT Adj margin (%) -3 12,1 16,2
Pretax profit Adj -9 2 11
Net profit Adj -10 3 10
Net profit to shareholders Adj -10 3 10
Net Adj margin (%) -11,7 4,1 11,4
Depreciation and amortisation -20 -13 -13
Of which leasing depreciation -3 -3 -3
EO items 0 0 0
Impairment and PPA amortisation 0 0 0
EBITDA lease Adj 14 20 24
EBITDA lease Adj margin (%) 17,2 24,6 27,6
EURm 2020 2021e 2022e
EBITDA 17 22 27
Net financial items -7 -8 -3
Paid tax -10 3 10
Non-cash items 16 -2 -11
Cash flow before change in WC 17 16 23
Change in WC 1 -4 -5
Operating cash flow 18 12 17
CAPEX tangible fixed assets -2 -1 -1
CAPEX intangible fixed assets -7 -9 -10
Acquisitions and disposals 23 0 0
Free cash flow 32 2 7
Dividend paid 0 0 0
Share issues and buybacks 0 0 0
Other non cash items -8 6 1
Decrease in net IB debt 29 8 15
Balance Sheet (EURm) 2020 2021 2022
Goodwill 16 16 16
Indefinite intangible assets 0 0 0
Definite intangible assets 33 35 26
Tangible fixed assets 0 0 0
Other fixed assets 17 17 18
Fixed assets 66 68 69
Inventories 0 0 0
Receivables 16 18 20
Other current assets 0 0 0
Cash and liquid assets 12 11 31
Total assets 93 97 119
Shareholders equity 4 15 25
Minority 0 0 0
Total equity 4 15 25
Long-term debt 36 39 39
Pension debt 0 0 0
Convertible debt 0 0 0
Deferred tax 2 2 2
Other long-term liabilities 21 32 31
Short-term debt 3 4 4
Accounts payable 27 25 22
Other current liabilities 0 0 0
Total liabilities and equity 93 97 119
Net IB debt 28 34 14
Net IB debt excl. pension debt 28 34 14
Capital invested 54 61 66
Working capital -12 -8 -2
EV breakdown 2020 2021 2022
Market cap. diluted (m) 107 184 190
Net IB debt Adj 28 34 14
Market value of minority 0 0 0
Reversal of shares and participations 0 0 0
Reversal of conv. debt assumed equity 0 0 0
EV 135 218 204
Capital efficiency (%) 2020 2021 2022
Total assets turnover (%) 72,5 83,9 81,1
Capital invested turnover (%) 112,8 138,5 149,6
Capital employed turnover (%) 125,5 185,2 230,4
Inventories / sales (%) 0 0 0
Customer advances / sales (%) 0 0 0
Payables / sales (%) 36,1 32,9 28,9
Working capital / sales (%) -13,3 -12,1 -5,7
Financial risk and debt service 2020 2021 2022
Net debt / equity (%) 775,1 227,8 57,4
Net debt / market cap (%) 46,5 18,4 7,5
Equity ratio (%) 3,9 15,4 20,9
Net IB debt adj. / equity (%) 775,1 227,8 57,4
Current ratio (%) 88,7 90,8 179,4
EBITDA / net interest (%) 247,7 298 788
Net IB debt / EBITDA (%) 163,9 151,5 52,9
Interest cover (%) -205,2 365,7 434,8
Lease liability amortisation -3 -3 -3
Other intangible assets 33 35 40
Right-of-use asset 0 0 0
Total other fixed assets 17 18 12
Leasing liability 0 2 2
Total other long-term liabilities 23 12 27
Net IB debt excl. leasing 28 32 12
Net IB debt / EBITDA lease Adj (%) 196,1 163 49,3
EURm 2020 2021e 2022e
Shares outstanding adj. 90 94 97
Fully diluted shares Adj 90 94 97
EPS -0,11 0,03 0,1
Dividend per share Adj 0 0 0
EPS Adj -0,11 0,03 0,1
BVPS 0,04 0,16 0,26
BVPS Adj -0,51 -0,38 -0,33
Net IB debt / share 0,3 0,4 0,1
Share price 0,67 1,96 1,96
Market cap. (m) 60 184 190
Valuation 2020 2021 2022
P/E -11,1 56,4 19
EV/sales 1,63 2,74 2,33
EV/EBITDA 7,9 9,7 7,6
EV/EBITA -54,5 22,7 14,4
EV/EBIT -54,5 22,7 14,4
Dividend yield (%) 0 0 0
FCF yield (%) 30,1 0,9 3,5
P/BVPS 29,75 12,37 7,63
P/BVPS Adj -2,35 -5,12 -6,02
P/E Adj -11,1 56,4 19
EV/EBITDA Adj 7,9 9,7 7,6
EV/EBITA Adj -54,5 22,7 14,4
EV/EBIT Adj -54,5 22,7 14,4
EV/cap. employed 3,1 3,7 2,9
Investment ratios 2020 2021 2022
Capex / sales 9,9 13,1 12,3
Capex / depreciation 49,2 104,2 107,6
Capex tangibles / tangible fixed assets 0 0 0
Capex intangibles / definite intangibles 19,9 27,3 23,9
Depreciation on intangibles / definite intangibles 43,4 11,9 10,3
Depreciation on tangibles / tangibles 0 0 0
Lease adj. FCF yield (%) 27,5 -0,6 2

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Media

Gaming Innovation Group - Company presentation with CEO Richard Brown
Gaming Innovation Group - Company presentation with CEO Richard Brown

Main shareholders - Gaming Innovation Group

Main shareholders Share capital % Voting shares % Verified
Andre Lavold 7.9 % 7.9 % 31 Jul 2021
Kjetil Myrlid Aasen 6.8 % 6.8 % 31 Jul 2021
Henrik Persson Ekdahl 5.1 % 5.1 % 31 Jul 2021
Nordea Liv & Pension 4.7 % 4.7 % 28 May 2021
Jesper Ribacka 4.7 % 4.7 % 31 Jul 2021
Swedbank Robur Fonder 4.6 % 4.6 % 31 Jul 2021
Formue Nord A/S 4.0 % 4.0 % 31 Jul 2021
Hans Michael Hansen 3.9 % 3.9 % 31 Jul 2021
Symmetry Invest A/S 3.1 % 3.1 % 31 Jul 2021
G.F. Invest AS 2.6 % 2.6 % 31 Jul 2021
Source: Holdings by Modular Finance AB

Insider list - Gaming Innovation Group

Name Quantity Code Date
Nicolas Adlercreutz + 7 500 BUY 18 Aug 2021
Petter Nylander + 21 800 BUY 23 Feb 2021
Henrik Persson Ekdahl -4 869 325 SELL 22 Dec 2020
Petter Nylander + 36 500 BUY 22 Dec 2020
Henrik Persson Ekdahl -4 896 125 SELL 22 Dec 2020
True Value Ltd +4 869 325 BUY 22 Dec 2020
Henrik Persson Ekdahl + 200 000 BUY 20 Feb 2020
Henrik Persson Ekdahl + 55 000 BUY 5 Sep 2019
Henrik Persson Ekdahl + 91 743 BUY 14 Aug 2019

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