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Esports Entertainment Group Reports Fiscal First Quarter 2021 Financial Results

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Esports Entertainment Group Appoints Damian Mathews as Chief Financial Officer

 

Esports Entertainment Group, Inc., an esports and online gambling company, announced its financial results for the fiscal first quarter ended September 30, 2020, as well as an update on several key business initiatives.

Business Highlights

  • Signed agreement to acquire Helix eSports and ggCircuit in deal valued at $43 Million
  • Acquired Argyll Entertainment and its SportNation brand, adding Tier 1 gambling license covering UK and Ireland; Malta gaming license secured in May 2020
  • Acquired assets of FLIP Sports, providing ownership and control of tech stack
  • Acquired Esports Gaming League, with a history of partnerships that include Microsoft, Red Bull Arsenal FC, and Activision; subsequent to acquisition EGL announced first-of-their kind deals with LA Kings, LA Galaxy, and Philadelphia Union to be official esports tournament provider
  • Partnered with Allied Esports as title sponsor of the VIE.gg CS:GO Legend Series tournament; the two-week competition drew 1.7 million unique viewers and generated 1 million hours watched, making it the most-watched Legend Series event since tournament was created in 2017
  • Expanded partnership with Dignitas, an esports asset of Harris Blitzer Sports and Entertainment, securing naming rights to famed CS:GO team; partnership includes strategic digital and physical activations in New Jersey marketplace as core focus
  • Partnered with Twin Rivers Gaming to launch VIE.gg wagering platform in New Jersey in calendar Q1 2021
  • Working with the New Jersey Gaming Commission to launch pilot skill-based player-to-player wagering platform, LANduel
  • Opened corporate office at Prudential Center in Newark, NJ

“We have achieved many significant milestones since uplisting to the NASDAQ in April,” commented Grant Johnson, CEO of Esports Entertainment Group. “The COVID-19 pandemic has absolutely accelerated the rapid growth of esports leading to mainstream broadcasts to national TV audiences on ESPN and Fox. These trends helped us set new record audience viewing stats with our partner Allied Esports for the globally recognized Legend Series, just one of many accomplishments during the quarter. We believe the successes achieved this year provide an extremely strong foundation for long-term growth while offering investors a true pure play opportunity in the burgeoning world of global esports.”

Johnson continued, “We have structured our business to deliver a diversified esports and online gambling company via three key business pillars and believe this multi-tiered approach provides investors broad exposure to two major trends, the rise of competitive gaming and the legalization of online gambling in the US.”

“As we look ahead, we believe the acquisitions we have made as well as those we plan to make, combined with a growing list of world-class partnerships, Esports Entertainment is in a great position to accelerate the monetization of our robust three pillar strategy,” concluded Johnson.

F1Q21 Financial Results

Revenue for the three months ended September 30, 2020 totaled $222,392, an increase of $222,392 over the $0 recorded for the three months ended September 30, 2019 (this includes only 2 months of contribution from Argyll because the deal closed on August 4th). The increase was primarily attributable to the acquisition of Argyll Entertainment as we are now revenue a generating company.

Post F1Q21, October has seen a significant uptick, with levels of turnover, Gross Gaming Revenue and Net Revenue returning to pre-COVID levels. Total handle was above $16 mil for the month of October and revenues for the month were above $600K.

Total operating expenses for the three months ended September 30, 2020 totaled $3.7 million, an increase from the $0.7m recorded for the three months ended September 30, 2019. The increase was primarily attributable to the increased payroll, stock compensation, marketing, legal and professional services fees related to increased business activity.

Total net loss for the three months ended September 30, 2020 was $1.8 million, driven principally by reduced revenues related to the measures taken post the regular UK Gambling Commission audit of Argyll Entertainment, partially offset by a change in fair market value of warrant liability of $2.1m.

As of September 30, 2020, the Company had total current assets of $10.4 million and total current liabilities of $8.2 million, resulting in working capital of $2.3 million. Cash and cash equivalents totaled $8.9 million and shareholders’ equity was $16.8 million at September 30, 2020.

Guidance

The Company reaffirms its guidance of $13 million in revenue in fiscal 2021 and $25 million in revenue in fiscal 2022 from its core Argyll and VIE platforms. On a proforma basis, including the acquisitions of Helix Esports and ggCircuit, the Company expects to report $42 million in revenue in fiscal 2022 with positive EBITDA of $2 million.

Fiscal First Quarter 2021 Conference Call

The Company will host a conference call today at 4:30 p.m. Eastern Time to discuss its F1Q21 financial results. Participants may join the conference call by dialing 1-855-327-6837 (U.S. Toll-Free) or 1-631-891-4304 (International). A live webcast of the conference call will also be available at http://public.viavid.com/index.php?id=142485.

For those unable to participate in the conference call, a telephonic replay of the call will also be available shortly after the completion of the call, until 11:59 pm ET on Monday, November 30, 2020, by dialing 1-844-512-2921 (United States) or 1-412-317-6671 (International) and entering the replay pin number: 10011948.

eSports

EA SPORTS NHL 24 World Championship Winner Announced

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A new champion was crowned yesterday in New York during the EA SPORTS NHL 24 World Championship, the National Hockey League announced. Ethan ‘Polgz’ Kerr-Polgar, who represented the Toronto Maple Leafs, earned his first EA SPORTS NHL 24 title, the $30,000 USD grand prize and a custom hockey stick trophy. The 21-year-old, Newmarket, Ont., resident won the back-and-forth, best-of-three series, including winning Game 1 in overtime against fellow Canadian Justin ‘Regs’ Reguly. With the win, Polgz cements his status as the top NHL 24 player in the World.

Polgz (@PolgzNHLon X) is an avid hockey fan and gamer who chose to represent his hometown Toronto Maple Leafs in the EA SPORTS NHL 24 World Championship. His superior offensive skills allowed him to score eight goals in the Final series to earn the World title. Polgz dedicated the win to his mother, who is his biggest supporter and has beat cancer three times.

Fellow Maple Leafs representative Regs finished the day as runner-up. Regs was previously the North American Champion of EA SPORTS NHL 22.

The virtual qualifying events for the live competition were hosted in partnership with Rival on its fan engagement platform that connects gamers from all over the world. The NHL 24 World Championship qualifying spanned two continents and showcased the global reach of virtual hockey.

EA SPORTS NHL 24 WORLD CHAMPIONSHIP RESULTS

Round Robin

Polgz (Toronto Maple Leafs) 3 vs. Regs (Toronto Maple Leafs) 2 (OT)

Deeks (Montreal Canadiens) 7 vs Tempannen (Anaheim Ducks) 3

Regs (Toronto Maple Leafs) 2 vs. Tempannen (Anaheim Ducks) 1 (OT)

Polgz (Toronto Maple Leafs) 4 vs. Deeks (Montreal Canadiens) 3

Regs (Toronto Maple Leafs) 5 vs. Deeks (Montreal Canadiens) 1

Polgz (Toronto Maple Leafs) 4 vs. Temppanen (Anaheim Ducks) 1

Standings after Round Robin

1. Eki (*automatically advanced to Semifinal) *defeated Gren for 1st seed

2. Gren (*automatically advanced to Semifinal)

3. Polgz, TOR (3-0-0), 6 pts

4. Regs, TOR (2-0-1), 5 pts

5. Deeks, MTL (1-2-0), 2 pts

6. Temppanen, ANA (0-2-1), 1 pts

Semifinal (best-of-three)

EKI (NYI) vs. Regs (TOR)

Regs wins series 2-0

Gren (BUF) vs. Polgz (TOR)

Polgz wins series 2-0

Final (best-of-three)

Game 1: Polgz, 3 vs. Regs, 2 (OT)

*Polgz took an early lead over Regs by scoring the first goal of the series. Polgz secured a two-goal lead in the second period, which was quickly answered by Regs bringing the score to 2-1. Regs made an epic comeback in the third period, tying up the game with 17 seconds left and forcing the first game into overtime. Despite strong gameplay from both sides, Polgz pulled through to earn the overtime win.

Game 2: Polgz, 0 vs. Regs, 5

*Regs dominated in Game 2 of the Final. He scored two goals in quick succession in the first period, then took a three-goal lead in the second period. Polgz had some good chances in the second period, but ultimately was unable to overcome Regs. Regs sealed the deal with another two goals towards the end of the third period, securing a 5-0 win over Polgz and tying the series at 2-2.

Game 3: Polgz, 5 vs. Regs, 3

*An unstoppable Polgz took the early lead, scoring four unanswered goals in the first period. After a mostly quiet second period, Regs got on the board with two unanswered goals of his own, suddenly cutting Polgz’s lead in half. Entering the third period at 4-2 with Polgz in the lead, Regs made up ground with another goal early in the third period, making for an exciting battle for the win. In the end, Polgz locked in the win with a fifth goal in the third period, winning Game 3 with a final score of 5-3 and ending the series 2-1.

World Championship History

YEAR WINNER RUNNER UP
2024 Polgz (Ethan Kerr-Polgar) Regs (Justin Reguly)
2023 Jos x 10 (Joseph Olmstead) EKI (Erik Tammenpää)
2022* NA: Regs (Justin Reguly)

EUR: EKI (Erik Tammenpää)

NA: Gren-35- (Matthew Grenier)

EUR: J-_-JamalTheMan (Jimi Rönkkönen)

2021* NA: Gren-35- (Matthew Grenier)

EUR: EKI (Erik Tammenpää)

NA: Regs (Justin Reguly)

EUR: NikkeDangles (Niklas Tukiainen)

2020* CAN: Regs (Justin Reguly)

USA: OF’s HF (Josh Fuss)

EUR: Artuzio (Arttu Mustila)

CAN: YungGren (Matthew Grenier)

USA: Top Shelf Cookie (Matthew Gutkoski)

EUR: MrNipsuli (Roni Kajan)

2019 Top Shelf Cookie (Matthew Gutkoski) JohnWayne90 (John Casagranda)
2018 EKI (Erik Tammenpää) Jr Pens (David Roebuck)

*World Championship canceled due to COVID-19 pandemic travel restrictions NA = North America / EUR = Europe

EA SPORTS NHL 23 WORLD CHAMPIONSHIP FINAL STANDINGS

1. Polgz, Toronto Maple Leafs ($30,000 USD)

2. Regs, Toronto Maple Leafs ($10,000 USD)

3. Gren, Buffalo Sabres ($5,000 USD)

4. Eki, New York Islanders ($5,000 USD)

5. Deeks, Montreal Canadiens ($1,000 USD)

6. Temppanen, Anaheim Ducks ($1,000 USD)

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eSports

BITKRAFT Ventures Launches New $275M Venture Fund, Continues to Invest in Early-Stage Gaming and Interactive Media Startups Globally

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Once closed, this fund will bring BITKRAFT Ventures’ total assets under management to over $1 billion

BITKRAFT Ventures, one of the leading global games investment platforms, has announced the filing of BITKRAFT Venture Fund 3, a $275 million fund dedicated to driving early-stage investments in gaming and interactive media companies. Serving as the successor to their two Early Stage Equity Venture Funds, BITKRAFT Venture Fund 3 will continue to invest in studios, platforms, and technology globally within the gaming and interactive media space at the Seed and Series A stages. Once closed, this milestone launch will bring BITKRAFT Ventures’ total assets under management to over $1 billion.

Grounded in its vision of synthetic reality, BITKRAFT believes in the transformative power of digital experiences, shaping the future of entertainment. With a core belief that humanity is increasingly immersing itself in digital realms, BITKRAFT recognizes game companies as central to this development, driving the evolution of digital entertainment. Founded by seasoned entrepreneurs and builders in the games ecosystem, BITKRAFT has grown from a small team to over 25 professionals distributed globally, with a presence in key markets in Asia, Africa, Europe, and North America.

“At BITKRAFT Ventures, we are as committed to — and optimistic about — the future of the games industry as we were from the inception of BITKRAFT in 2016. We’ve seen continued growth across all major game platforms, in metrics including user engagement, activity levels, and monetization,” says Jens Hilgers, Founding General Partner at BITKRAFT Ventures. “Newly formed game studios have seen substantial break out successes over the last years, and the advent of AI in game production further benefits new upstarts in the space. Additionally, we have witnessed increased interest in game content beyond incumbents from media and tech giants, as well as private equity firms entering the landscape of potential buyers further expanding the exit landscape.”

BITKRAFT Ventures has strategically invested in various stages in a global roster of well-known companies including Frost Giant, a studio dedicated to bringing back real-time strategy; Anzu, an in-game advertising platform revolutionizing the gaming industry; Carry1st, a mobile gaming platform focused on serving the African market; InWorld, a social platform merging the digital and physical worlds; Voicemod, a voice modulation software empowering content creators; Immutable, the creators of the popular blockchain game Gods Unchained; and Karate Combat, an innovative martial arts league bringing high-octane combat sports to global audiences.

BITKRAFT Ventures’ funds exhibited noteworthy performance, as documented by the Cambridge Associates Benchmarking Data Report 2023. BITKRAFT’s inaugural Web 3 fund achieved a top 5% ranking, while its second Venture Fund secured a position in the top 8% of all funds based on Internal Rate of Return (IRR).

 

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Canadian Gaming Summit: Providing the Framework for Sports Betting Success

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As sports betting professionals seek to strengthen their connection with Canadian bettors, the Canadian Gaming Summit will provide the optimal framework for stakeholders to harness brand loyalty, innovate their offerings and strike lucrative partnerships, all aimed at solidifying their presence in the region.

The Sports Betting track is scheduled to take place on the first core day of the summit, Wednesday, June 19, at the Metro Toronto Convention Center. Catering to 3,000 industry stakeholders, discussions will encompass fostering mutually beneficial relationships with sports leagues, strategies to emulate the success of Canadian lotteries, analyzing the profiles of Canadian sports viewers and exploring the future of eSports and daily fantasy sports (DFS).

Opening the track is the panel entitled The Winning Ticket: How Sports Betting Can Emulate Lottery’s Appeal. It will explore the strategies sports betting operators can adopt to rival the popularity of traditional Canadian lotteries. Industry experts will examine whether sports betting operators are taking the right approach to emulate the success, brand loyalty and integrity of lotteries and whether a rise in the popularity of sports betting will affect provincial lottery models.

The session entitled It’s All In The Game: Innovations In Live Betting will shed light on how live, in-gaming betting is leading the way for innovation within sports betting. Industry luminaries will discuss the importance of crafting real experiences for bettors, analyze the profiles of potential bettors and explore strategies to fully integrate sports streaming content with sportsbooks.

The Game Changers: Collaborative Synergy With Sports Leagues panel will explore the power of sports league partnerships and how they are redefining the Canadian sports betting landscape. Expert panelists will delve into the intricacies of such partnerships and discuss how successful partnerships can be leveraged to enhance brand visibility, fan engagement and market presence. The panel will also examine successful case studies, partnership models and ideal strategies for achieving mutually beneficial partnerships.

Expert speakers set to appear across the track will include Conor Murray (VP Marketing, FanDuel), Nic Sulsky (CCO, Pointsbet), Owen Welsh (VP Gaming, Sports Betting and Innovation, CFL), Martin Lycka (SVP American Regulatory Affairs and Responsible Gambling, Entain), Britt Doll (Global Marketing Director, Rivalry), Tomer Imber (Senior Director of Sales, Optimove), Iain Montgomery (founder, Now or Never Ventures), Michael Sandalis (founder, Wait What), Peter Czegledy (Partner, Aird & Bellis), Anthony Gaud (founder, Gaud Hammer Gaming Group), Sean Simpson (Senior VP, IPSOS), Paul Burns (President, CGA), Scott Morasch (Senior VP, IPSOS), Sebastian Jedrzejewski (Director Regulatory Affairs, US Integrity), Greg Bloom (CEO, BYB Extreme), Steve McAllister (VP, Parleh Media), Troy Ross (President, TPM Public Affairs), Witek Wachinski (VP Strategy and Development, BetMGM), Patrick Harris (Managing Partner, Rubicon Strategy) with more to be announced.

Attendees will have the opportunity to strengthen their knowledge of the Canadian market through dedicated conference tracks on affiliation, advertising, leadership, land-based operations, payments and compliance. Additionally, attendees will have the opportunity to attend a pre-day player protection symposium.

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