The flood of quarterly earnings reports for legal sports betting providers in the US continued this week with Golden Nugget Online Gaming’s (GNOG) turn to reveal some positive Q1 numbers that ended March 31, 2021. The report reveals some encouraging news for Golden Nugget about their recent past and also some positive trends for the company as we head deeper into 2021.
On Monday, Golden Nugget released their Q1 financials, and not only did they beat consensus estimates but they put the company on a good path as they try to establish themselves as a major player within the exploding US legal sports betting scene. With Monday’s news, there is nothing but optimism coming out of the Golden Nugget camp that 2021 will be a banner year.
President Thomas Winter stated: “We are very pleased to start 2021 with such strong results across both our established and new expansion markets. We believe we are well positioned to capitalize on the significant and fast-growing market for igaming across North America. We expect that 2021 will be a milestone year for the company as we are on target to be live in six states by the end of the year, including all four key igaming states.”
The Numbers
Golden Nugget had a good Q1 of their fiscal 2021 year. Revenues were reported to be $26.7 million, a 54.2% year-over-year increase from the $17.3 million reported during the first quarter of 2020.
Net income for the company was reported to be a respectable $69.6 million for the first quarter, which is an enormous year-over-year spike from the $4.2 million reported in the first quarter of 2020, at the start of the coronavirus pandemic and when Golden Nugget’s commitment to the US legal sports betting industry wasn’t quite where it is today.
Non-cash gains on warrant derivative liabilities came in at $81.1 million and non-cash gains on its tax receivable agreement liability were reported to be $1.3 million. Debt extinguishment expenses came in at $2.2 million for the quarter.
In a statement to investors, Golden Nugget said that: “… first quarter results also reflect interest expense associated with the term loan credit agreement entered into on April 28, 2020. The company’s results also reflect debt extinguishment costs of $2.2 m including the accelerated amortization of deferred loan costs and debt premium totaling $0.6m associated with the early repayment of $10.6m of the term loan during the three months ended March 31, 2021.”
EBITDA and Projected Full Year Revenues
Golden Nugget’s Adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) for Q1 was reported to be $3.5 million. That’s a dip from the $5.9 million the company reported for the first quarter of 2020 but just likely a product of Golden Nugget’s expansion plans.
When all added up and considered, analysts and the company itself feels the full-year revenue totals will fall within the $130 million to $145 million range, just as predicted a few months ago.
The Future Is Very Bright
Golden Nugget has certainly come a long way since announcing their intention of becoming a bigger player in the US legal sports betting scene in the latter part of 2020. Previously a middling but recognizable name in the industry, their concentration on the online wing of legal sports betting has thrust them into the next category of providers.
Chairman and Chief Executive Officer, Tilman Fertitta added: “The future is very bright for Golden Nugget Online Gaming as we achieved another record quarter in revenue and with our newly announced partnerships in Colorado and Iowa, we now have market access in 12 states, representing approximately 29% of the US population.”
Expect the company to continue to expand deep into 2021. Moves into Michigan and Colorado, pending legislation and regulatory approvals gives them access to two of the more impressive markets in the US legal sports betting scene.
As the North American legal sports betting gold rush continues, so too will Golden Nugget’s ascension up the betting provider ladder. Q1’s positive financials is likely just a sign of things to come for Golden Nugget Online Gaming Inc.
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