Gaming Realms targets licensing strategy as share price falls 14%

Gaming Realms this morning reported an 11% decrease in total revenue to £6.8m, with 28% growth in real money B2B and licencing revenue offset by a 48% decline in social gaming revenue.

The firm’s B2C division, which was sold in June, saw revenue down 43% to £4.1m from £7.2m in the same period last year.

B2C real-money marketing spend also plummeted 65% to £0.7m, down from £2.0m in 2017, but adjusted EBITDA before share-based payments increased by £1.5m to £0.4.

Gaming Realms CEO Patrick Southon said: “Our strategy moving forward is to leverage our real money gaming platform and our market leading ‘Slingo Originals’ games library into the UK and international gaming markets.

“We believe that licensing our platform and content to leading brands and gaming operators will deliver high margin revenues, and we have been very pleased with the results of our efforts over the first half of 2018.

“We look forward to delivering news about more developments on our strategy during the second half of the year,” he added.

Gaming Realms CEO Patrick Southon

Gaming Realms’ share price was down -14% at the time of writing.

Regulus Partners analyst Paul Leyland wrote: “Gaming Realms’ strategy of positioning into ‘softer’ gaming and generating genuinely differentiated content on modern technology certainly stacks up from a top-down perspective, in our view.

“However, the group’s recent history demonstrates that a clear strategy needs to be matched by deep pockets and strong operational discipline – especially when that strategy effectively relies upon efficiently attracting some of the lowest spending customers available in the market.

“In this context, partnerships with bigger operators seeking greater levels of differentiation and segmentation (JPJ, GVC, Golden Nugget in NJ) makes considerable sense.

“With the homemade ice-cream largely melted, the big question now is whether the cone is strong enough to take several flavours at once,” he added.