Canada
Nuvei Reports Third Quarter 2020 Financial Results
Nuvei Corporation, the global payment technology partner of thriving brands, today reported financial results for its third quarter of 2020.
“I am incredibly proud of all that we accomplished in the third quarter, as we embarked on our journey as a publicly-traded company. We believe our performance, which included total volume* of $11.5 billion along with strong revenue growth, is a testament to the strength of our technology, business model and focus on high growth verticals,” said Philip Fayer, Nuvei’s chairman and CEO. “Furthermore, we made significant progress executing our growth strategy, broadening our capabilities and footprint, as well as winning many notable clients. We earned regulatory approval in the states of Indiana and Colorado for sports betting, and launched local acquiring in Hong Kong, Singapore, Russia, Brazil, and Columbia, meaningfully expanding our total addressable market. Lastly, we were thrilled last week to announce the closing of the Smart2Pay acquisition, which not only strengthens our global presence in high-growth markets including digital gaming, but allows us to offer a more complete, robust alternative payment solution. Looking ahead, we are well positioned to continue to scale the business and drive shareholder value.”
Financial Highlights for the Three Months Ended September 30, 2020
- Total volume was $11.5 billion, an increase of 62% as compared to $7.1 billion in the third quarter of 2019
- Revenue was $93.6 million, an increase of 32% as compared to $70.8 million in the third quarter of 2019
- Net loss in the quarter was $77.9 million, as compared to $65.7 million in the third quarter of 2019
- Net loss included $83.4 million in non-cash finance costs resulting from the Company’s initial public offering (“IPO”) and associated valuation
- Adjusted EBITDA** was $41.0 million, an increase of 59% as compared to $25.8 million in the third quarter of 2019
- Adjusted net income** was $16.5 million, as compared to $2.2 million in the third quarter of 2019
- Following Nuvei’s successful IPO in September, the Company used the net proceeds for the repayment of debt. The Company ended the quarter with $99.4 million in usage of its credit facilities (net of unamortized transaction costs), down from $717.8 million (net of unamortized transaction costs) as at December 31, 2019. In addition, unsecured convertible debentures and liability classified common and preferred shares were fully converted or repaid as a result of the IPO.
Recent Operational Highlights
- The Company made significant progress on its strategic plan to support the fast-growing U.S. sports betting industry launching its first pilot merchant, Carousel, in Colorado. In August, Nuvei was awarded a certificate of registration for sports wagering from the Indiana Gaming Commission, and in September, the Company received its sports betting vendor license from Colorado’s Division of Gaming. In addition, the Company is in the process of applying for approval in all other states that permit online sports betting and gaming.
- Nuvei has accelerated its new client wins by signing many notable merchants in the quarter including Kwiff, Maxbet, Superbet, Wargaming, Oanda, Pepperstone, and Rinascente, across the gaming, financial services, and marketplace verticals. This provides strong momentum into the fourth quarter and 2021.
- Nuvei continued to execute on its strategic plan by expanding its footprint geographically, launching local processing solutions in Hong Kong, Singapore, Russia, Brazil, and Colombia. These new markets enlarge the Company’s total addressable market, providing extended reach for existing merchants and enabling Nuvei to win new merchants in those countries.
- The Company expanded its support for cryptocurrency exchanges, onboarding two exchanges during the quarter.
- The Company continues to enhance its offering including foreign exchange services, PSD2 mandate support, early warning dispute management solutions and payout capabilities that includes the launch of Mastercard MoneySend.
Initial Public Offering
On September 22, 2020, Nuvei announced the successful closing of its IPO. The IPO, along with a concurrent private placement, raised $833 million in aggregate proceeds resulting in $758 million of proceeds to the Company.
Subsequent Event
On November 2, 2020, the Company announced the completion of its previously disclosed acquisition of Smart2Pay Global Services B.V. (“Smart2Pay”), demonstrating the Company’s commitment to growth through strategic acquisitions. The total consideration was settled with $82.9 million in cash, and the balance with 6,711,923 shares issued by the Company. The Smart2Pay acquisition strengthens Nuvei’s presence in the high-growth digital gaming space and further expands the Company’s geographic footprint in additional regions including Russia, Brazil, as well as adding UnionPay processing. Furthermore, the transaction creates one of the largest and most complete alternative payment method (“APM”) solution providers in the world, with 450 APMs supporting global commerce, all through a single integration.
Outlook
Total volume in the fourth quarter of 2020 to date continues to be strong with year-over-year growth in line with the third quarter of 2020. The following should also be considered for the fourth quarter of 2020:
- The results of Smart2Pay will be included in the Company’s results as of the date of closing, November 2, 2020.
- The fourth quarter of 2020 will represent the Company’s first full quarter as a public company. As a result, incremental costs pertaining to being a public company will be incurred in the quarter.
- The Company continues to invest in its direct sales force.
*Total volume does not represent revenue earned by the Company, but rather the total dollar value of transactions processed by merchants under contractual agreement with the Company. Total volume is explained in further detail in the Company’s MD&A.
**Adjusted EBITDA and Adjusted net income are non-IFRS measures. Reconciliations of these non-IFRS measures to the most directly comparable IFRS financial measures are included in the tables at the end of this press release. An explanation of these measures and how they are calculated are also included under the heading “Non-IFRS Financial Measures”.
The conference call will be webcast live from the Company’s investor relations website at https://investors.nuvei.com/ under the “Events & Presentations” section. The conference call can also be accessed live over the phone by dialing 877-425-9470 (US/Canada Toll-Free), or 201-389-0878 (International). A replay will be available approximately two hours after the call, and can be accessed by dialing 844-512-2921 (US/Canada Toll-Free), or 412-317-6671 (International); the conference ID is 13711347. The replay will be available until Wednesday, November 25, 2020. An archive of the webcast will be available at the same location on the website shortly after the call has concluded.
The complete financial results are available at Sedar (www.sedar.com), as well as at Nuvei’s investor relations website.
About Nuvei:
We are Nuvei, the payment technology partner of thriving brands. We provide the intelligence and technology businesses need to succeed locally and globally, through one integration – propelling them further, faster. Uniting payment technology and consulting, we help businesses remove payment barriers, optimize operating costs and increase acceptance rates. Our proprietary platform offers direct connections to all major payment card schemes worldwide, supports 450 local and alternative payment methods and nearly 150 currencies. Our purpose is to make our world a local marketplace. For more information, visit www.nuvei.com.
BetVictor Canada has launched its new out-of-home advertising campaign across the streets of Toronto to promote NBA legend Tracy McGrady as its Safer Gambling Ambassador.
Two mobile digital trucks strategically targeting high-traffic areas near Scotiabank Arena, Rogers Centre, and major sporting events will provide prime audience exposure for the campaign, scheduled around Toronto Maple Leafs, Toronto Raptors, and Toronto Blue Jays home games.
To further enhance the campaign’s reach, BetVictor Canada has partnered with Clear Media Group to leverage digital taxi tops across Toronto, providing city-wide exposure with 100 taxis displaying key brand messaging. These digital taxi tops will run during peak evening hours (5:00pm – 9:00pm) on select dates until April 5th, 2025.
The campaign coincides with Problem Gambling Awareness Month, a nationwide grassroots campaign held each March that seeks to increase public awareness of problem gambling and promote prevention, treatment, and recovery services.
BetVictor Canada offers an array of tools and services to help its Canadian customers bet and play safely and responsibly, across a host of sports betting markets and online casino games.
Mark Harper, Head of Emerging Markets at BV Group, said: “BetVictor is delighted to be participating in the National Council of Problem Gambling campaign in March, to help increase public awareness of problem gambling and the need to promote prevention, treatment and recovery services.
“In using our Safer Gambling Ambassador, Tracy McGrady, to raise awareness about BetVictor’s safer gambling tools such as loss limits, time alerts and product restrictions we are dedicated to ensuring all players have a safe gambling experience. #PGAM2025.”
Canada
AGCO issues $110,000 in penalties to BetMGM Canada for offering cash to induce new gambling customers
The Alcohol and Gaming Commission of Ontario (AGCO) has served BetMGM Canada Inc. with an Order of Monetary Penalty (OMP) of $110,000 for violations of the Registrar’s Standards for Internet Gaming.
In two separate incidents in 2024, BetMGM engaged marketing companies who offered cash to members of the public in return for opening new BetMGM accounts. The marketing activities occurred in public forums, such as a major national trade conference. Under AGCO’s Standards, operators are responsible for the conduct of their third-party suppliers who are contracted to support the operator’s Ontario gaming business, and must require their third-parties to meet Ontario laws, regulations and standards (Standard 1.19).
Ontario is one of the first jurisdictions in the world to establish and enforce rules that strictly limit high-risk inducement advertising and marketing in the online gambling industry. Registered iGaming operators are prohibited from offering gambling inducements, bonuses and credits as part of their broad public advertising and marketing activities (Standard 2.05). These Standards exist to protect Ontarians from predatory advertising and promotional marketing practices in order to limit the risk of gambling-related harm.
A registered operator served with an OMP by the AGCO has the right to appeal the Registrar’s decision to the Licence Appeal Tribunal (LAT), which is an adjudicative tribunal independent of the AGCO and part of Tribunals Ontario.
QUOTE
“Responsible gambling safeguards and the protection of Ontarians on registered gaming sites is among our key priorities. The AGCO monitors the activities of all registered operators and their third-party suppliers to ensure they are meeting our high standards and we continue to take strong action to ensure they operate within the public interest.”
Dr. Karin Schnarr, Chief Executive Officer and Registrar – AGCO
ADDITIONAL INFORMATION
BetMGM Canada Inc. failed to comply with the Registrar’s Standards for Internet Gaming. Specifically, the licensee failed to comply with the following provisions of the Standards:
- 1.19 Operators are responsible for the actions of third parties with whom they contract for the provision of any aspect of the Operator’s business related to gaming in Ontario and must require the third party to conduct themselves in so far as they carry out activities on behalf of the operator as if they were bound by the same laws, regulations, and standards.
- 2.05 Advertising and marketing materials that communicate gambling inducements, bonuses and credits are prohibited, except on an operator’s gaming site and through direct advertising and marketing, after receiving active player consent.
Contrary to the Standards, BetMGM Canada Inc. and/or their affiliates allegedly engaged in the following activities:
| a) | On or about January 13 and 14, 2024, BetMGM representatives were alleged to have attended the National Franchise Show and were offering $100 in cash to new players for opening a new account and depositing $15. |
| b) | On or about March 11, 2024, BetMGM acknowledged that its marketing affiliate “Above the Street” had engaged in prohibited inducement marketing. The conduct resulted in 377 player sign-ups and $127,180.00 in commissions to “Above the Street”. |
| c) | On or about April 13, 2024, another BetMGM marketing affiliate “Maple Leaf Marketing” engaged in prohibited inducements and marketing to induce on-site activations and acquire new players. The conduct resulted in 94 player sign-ups and about $34,000.00 in commissions paid to “Maple Leaf Marketing”. |
BCLC’s new “What’s played here stays here” campaign is issuing an important reminder to British Columbians who choose to gamble – specifically that all net profit its operations generate stays in B.C. to help fund critical services like education, health care and community programs.
The campaign also reinforces that all other gambling websites operating in B.C. are illegal and take away funds from critical community programs and services.
“Across B.C. and Canada, we’ve seen incredible groundswell around the importance of buying and supporting local, and that’s no different for British Columbians who choose gambling for their entertainment. We want our B.C. players to know they can find a world-class gambling experience in their own backyard, whether it’s at one of our 33 casinos, 3,400 lottery retailers, or online at PlayNow.com, and that the proceeds from their play with BCLC make a positive impact at home in their community,” Pat Davis, President and CEO of BCLC, said.
Along with illegal online gambling websites, BCLC also competes with Washington State and Las Vegas casinos, all of which aggressively market to B.C. residents.
“BCLC continues to raise awareness that these gambling options do not support B.C.’s economy and take away funds from vital provincial and community-based programs and services. In a time when British Columbians are standing united, we want to reinforce that playing together with BCLC helps make B.C. even better,” Pat Davis added.
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