Total revenues for Neogames came to $50.5m, which was up by 2.6%.
Most of NeoGames’ own revenue – $29.9m – came from turnkey contracts. However, this figure was down by 7.2% from $32.2m in 2020.
Revenue from games contracts, meanwhile, was almost exactly stable at $2.0m
Access to IP rights contributed $8.0m in revenue, a 19.4% increase, while development and other services revenue related to NeoGames’ NeoPollard Interactive joint venture with Pollard Banknote grew 72.7% to $7.6m.
The business also made $1.4m from its joint operation of ilottery services for the Michigan Lottery.
Revenue for development and other services related to Aspire – from which Neogames was spun off in 2014 – dropped by 33.3% to $1.6m.
However, operating expenses grew by 37.4% to $51.6m, meaning the business posted an operating loss for the year. NeoGames paid $9.9m in distribution expenses, up 48.1%, and $9.4m in development expenses, up 26.2%.
Selling and marketing expenses, meanwhile, grew slightly to $1.5m and general and administrative expenses were $12.3m, up 64.0%. Depreciation and amortisation costs were $14.6m, which was up 24.9%.
The business then paid $3.8m in new costs related to the prospective acquisition of Aspire. As a result, NeoGames reported a $1.2m operating loss, after an $11.6m operating profit the year prior.
In addition, it paid $4.8m in interest expenses, up 10.1%, and $1.5m in finance expenses, up 100.4%.
However, the business made an additional $34.1m in revenue from its 50% share in NeoPollard Interactive. This was up 256.9%.
After $21.6m in NeoPollard costs, Neogames’ share of profits came to $12.4m, compared to $1.4m in 2020.
As a result, Neogames’ pre-tax profit was $5.0m, down 37.5%. After paying $325,000 in taxes, it recorded a net profit of $4.7m, which was 28.6% less than the year before.
After the year ended, NeoGames submitted a public offer worth SEK4.3bn (£349.0m/€417.6m/$476.0m) to acquire 100% of the shares in Aspire Global. An acceptance period for this bid, where the Aspire board must decide whether to approve the offer, commenced earlier this month and will run until 3 May.
Looking ahead to 2022, NeoGames announced revenue guidance of between $90m and $97m for the combined NeoGames and NeoPollard businesses. The midpoint of this would be up 11.0% from 2021.
Moti Malul, chief executive officer of NeoGames, said that the business expects to see significant growth with Aspire in the Neogames portfolio, and hopes to see the deal close this quarter.
“We carried our momentum into 2022 with our offer to acquire Aspire Global, which continues to be on track for closing in the first half of 2022,”Malul said. “More and more we find our iLottery customers require a broad range of integrated gaming verticals.
“We firmly believe that combining NeoGames and Aspire Global will drive our strategy to be a leader in providing digital solutions to lotteries globally. We are already successfully collaborating with Aspire to launch their Pariplay content in Alberta and the early results are very encouraging.
“We remain focused capitalising on an expanding market opportunity and continuing to create value for our shareholders.”
Original article: https://igamingbusiness.com/jv-helps-neogames-post-2021-profit-as-aspire-deadline-looms/
