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NeoGames Q3 2023: Net income still at a loss

Net loss was mainly attributed to the ongoing transaction for Aristocrat to purchase NeoGames.

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NeoGames has published its third quarterly financial results for 2023, reporting revenue and share of NeoPollard Interactive (NPI) revenue interest of $63.3m. This figure is down 13.6% when compared to Q3 2022.

Standalone revenue for Q3 is down 25.6% year-on-year, dropping from $62.2m to $46.3m. Meanwhile, NeoGames’ share in NPI revenue has grown 53.3% from $11.1m to $17m during the same period.

The total of NeoGames’ iLottery revenue plus the Company’s share of NPI revenues during the third quarter of 2023 was $31.4m, up 26.9% year-over-year. This was said to have been primarily driven by ‘continued positive growth trend across most major accounts and the jackpot in the US market during the third quarter.’

The company clarified in its release that: ‘‘These figures reflect accounting for the majority of Aspire Core revenues on a net basis in Q3 of 2023 compared to Q3 2022, which were prepared on a gross basis, prompted by new commercial terms in certain Aspire Core contracts which went into effect on 1 January 2023.

‘If iGaming revenues had been accounted for on a gross basis for the Aspire Core, the total of revenue and the Company’s share in NPI revenues would have been $81.7m, which would have reflected 11.5% year-over-year growth when measured in reporting currency.’

NeoGames revealed that its revenue drop is ‘partially offset by a slowdown in Aspire Core revenues due to regulatory changes in the United Kingdom and a temporary pause in operations in Germany prior to the Company recently securing its local licence to operate.’

Despite the above revenues being on the decline, iLottery revenues had risen to $14.4m during the third quarter of 2023, compared to $13.7m during Q3 of 2022, increasing 5.6% year-over-year.

Furthermore, revenue from iGaming totalled $31.9m, dropping 34.2% when compared to Q3 2022’s figure of $48.5m.

Adjusted EBITDA was on the rise, increasing 12.9% year-over-year to $19.9m; meanwhile, NeoGames' net loss streak continued, although it improved from minus $4.4m to minus $3.6m.

The Company stated that net loss during this quarter was mainly due to costs attributed to the Aristocrat transaction and the amortisation attributable to the Aspire business combination.

Moti Malul, CEO of NeoGames, said: “We are pleased with the progress we made during the third quarter advancing our strategic goals while we continue to work towards completing our merger with Aristocrat Leisure.

"Our iLottery business continues to win market share and grow as we have recently announced that our joint venture, NeoPollard Interactive, expanded its footprint in the US, winning a public procurement to provide the West Virginia Lottery with a full iLottery program. 

"Furthermore, we are working together with the North Carolina Lottery to prepare for the expansion of their iLottery program as they recently received approval to launch eInstant games. Pariplay's extensive aggregation collaborations, including deals with OPAP in Greece to introduce games from NeoGames Studio, and iGaming content with Rush Street Interactive in Pennsylvania, further bolster our market presence."


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