Bragg Gaming Posts Q3 Report, Shares Plummet as Execs Rule Out Sale

Bragg Gaming Group has published its Q3 report, highlighting a stable and growing business with record-breaking revenue growth. The company, however, saw its share price decline after it denied a potential sale of its business.

The Company’s Business Remained Strong

In Q3, Bragg’s revenue increased by 16% year-on-year to EUR 26.2 million ($27.7 million). Gross profits, on the other hand, increased by 18.1% YOY to EUR 14 million ($14.8 million), with margins increasing from 52.5% to 53.5%.

Adjusted EBITDA for the period, on the other hand, experienced a 7.1% increase to EUR 4.1 million ($4.3 million) with an AEBITDA margin of 15.6%. At the end of the quarter, the company had EUR 11.6 million ($12.3 million) in cash and cash equivalents.

In addition, the company updated its guidance for FY 2025. It now expects revenue in the range of EUR 102-109 million ($107.8-115.2 million) and adjusted EBITDA in the range of EUR 15.2-18.5 million ($16-19.6 million). The company added that it is currently tracking to the lower end of the guidance.

Bragg Completes Strategic Review

In March 2024, Bragg Gaming initiated a strategic review of its business, exploring potential M&A opportunities. Conducted by a Special Committee in partnership with Oakvale Capital and Blake, Cassels & Graydon, the review sought a range of strategic alternatives.

After leading discussions with dozens of potential counterparties and receiving multiple non-binding proposals, the Special Committee and the board of directors unanimously agreed that “none of the proposals received reflect the company’s intrinsic value or current and projected financial performance.”

As a result, the review was concluded and the Special Committee was disbanded. Bragg noted that it remains open to potential opportunities to maximize shareholder value.

While Bragg believed that this was the right move, all things considered, the news caused its share price to plummet by 30% from CAD 6.10 to CAD 4.26 where it remains as of the time of this writing.

Despite the setback, Bragg Gaming remains optimistic about the future. The company relies on its momentum in the US to help it expand its business and generate additional shareholder value. According to its report, Bragg is expecting a robust sales pipeline in 2025. The company is also positioned to be a leading platform in Brazil where it plans to launch its PAM.