Gaming Realms’ 2022 full-year results were certainly some of the more positive to come out of the financial season. The operator reported a revenue rise of 27.2% for the year to £18.7m, along with a 112.0% increase in content licensing revenue growth in North America.
Segal attributes Gaming Realms’ success to a number of elements, with marketing at the forefront.
“It’s a mixture of three things,” says Segal. “The first is New Jersey – which is a more mature market for us – we still grew in that market throughout the year.”
Mark Segal, CEO, Gaming Realms
“The next element, which is a larger element of it is, in the backend of 2021 we launched in Michigan and Pennsylvania. And finally we launched in Ontario on the market opening day.”
Segal draws attention to the success of Gaming Realms’ Slingo product – a product comprising of slots and bingo – which he says was at the crux of the company’s success in 2022.
“It’s a mixture of higher growth on the new markets, and markets that have been recently launched, and managing to grow in markets we’re maturing in,” he says. “Slingo is popular in all our markets, particularly in the US.”
“We have great relationships with operators there. It’s got great brand presence in the US.”
Market presence
Although Gaming Realms’ content licensing skyrocketed in the US, Segal does not envision the same growth in 2023. Instead, he sees success in Gaming Realms’ other live markets.
“If I’m being honest, I don’t think the North American growth will be the same this year,” he muses. “Albeit, I think we’ll see – like the model before – where we’ve gone live in certain markets and with operators, we’ll see good growth in those.”
“It’s just that we’ll have slightly more mature business in other areas.”
These other areas are likely to include Gaming Realms’ most recently entered markets, explains Segal, which will benefit from renewed focus in the next year.
“We don’t have a new US market to tackle [in 2023], which allows us to focus on other markets,” he says. “Italy, for example, Spain, the Netherlands. They’re markets we went into in the last year or so.”
“Hopefully we’ll go into Greece this year, and South Africa. It’s really exciting.”
Home of the brave
Gaming Realms’ US success is further evidenced by its aggregation launch in 2022, which Segal coined as a particular asset going forward.
“We started an aggregation business in the year, taking for-the-player slots into the US market,” he says. “It’s still small. I’m not saying we’re going to become an aggregator, but it just shows how difficult it is to get distribution in the US, and we’re there. So we have a big asset in distribution there.”
Despite an uptick in US market presence, Gaming Realms’ marketing spend tumbled by 70% in 2022. Segal says this signifies the company’s strategic outlook and where growth is generally predicted to occur.
“We have two sides to our business,” he explains. “The big growth driver is our content licensing, being a games studio, and aiming to be a leading supplier. But the other side is our social business in the US.”
“The majority of marketing begins with that.”
High margins
Gaming Realms’ 218.2% growth in pre-tax revenue, as well as a rise in earnings before interest, tax, depreciation and amortization (EBITDA) of 45.1% is a marker of operational leverage, says Segal.
“We’re quite a high margin business incrementally,” he continues. “So we’ve reached the point where we have operational leverage in the business so that we can grow the revenues at a higher margin than before.”
But Segal maintains that Gaming Realms’ wagering power is its biggest asset.
“What underpins a lot of what we do now is, we’re got a big platform which is generating £4bn worth of bets,” he explains. “We have a big platform in many markets, and we’re ready now to enter markets quite quickly, particularly the US and North America as they open.”
Looking back over 2022, Segal doesn’t offer just one main success for Gaming Realms throughout the year. It’s a collective positive action, one evidenced by a steady momentum in its live markets.
“It’s not one thing,” he muses. “I think it’s the fact that we’re able to continue this momentum of having quarterly growth, monthly gaming launches in the operators we have live.”
This is something that Segal hopes to continue into 2023 – with the first two months of the year potentially providing a sign of things to come.
“We’ve started this year with 53% year-on-year revenue growth in the first two months,” he says.
“We’ve started 2023 really well, which is really exciting for us.”
