GGRAsia – Ainsworth expects rev uplift after amending GAN deal: CEO

Ainsworth expects rev uplift after amending GAN deal: CEO

May 19, 2023 Newsdesk Industry Talk, Latest News

The chief executive of Australia-listed slot machine maker Ainsworth Game Technology Ltd, Harald Neumann (pictured), says the company expects an “initial uplift” in revenue following the amendment to a deal with GAN Nevada Inc, a subsidiary of GAN Ltd, a provider of interactive Internet-delivered games.

GAN had, since July 2021, exclusive licensing rights to Ainsworth’s online real-money games (RMG) in the U.S. for a period of five years. Under the amended agreement, GAN’s exclusivity will end on March 31 next year, according to a March announcement by Ainsworth.

From April 1, 2024, “Ainsworth will retain all real money gaming revenues from direct integrations with operators, in addition to revenues from aggregation platforms, including GAN,” stated Mr Neumann.

“This is expected to provide an initial uplift in 2023 and the first quarter of 2024 from the exclusivity fee of US$5.0 million previously received and going forward is expected to allow greater flexibility to service our U.S. customers, aligning future digital and land-based strategies,” added the CEO.

His remarks were made on Friday in an address to shareholders during the company’s annual general meeting.

Mr Neumann also confirmed that Ainsworth entered the first half of the 2023 calendar year “with good momentum”.

Earlier this month, the gaming supplier said it expected to report a pre-tax profit of AUD20 million (US$13.5 million) for the six months to June 30. It stated the forecast excluded “currency impacts and one-off items”.

“The new year has started well, and we will continue to execute to plan,” stated Mr Neumann. “I expect that further market share gains and financial improvements can be realised as the outputs from the development initiatives currently implemented are commercialised.”

Company non-executive chairman Danny Gladstone, also attending the annual general meeting, said that, amid “economic uncertainties” and “supply chain challenges”, Ainsworth “considered necessary” an increased level of working capital and inventory levels, in order to “ensure continuity in production to fulfill expected sales volumes in calendar year 2023”.

“Once these conditions stabilise and operational requirements can be reliably determined, the board maintains its commitment to review the recommencement of dividend payments to our shareholders,” added Mr Gladstone.