XLMedia hit by regulatory trends as revenue slips in H1
Published 25th September 2019
Revenue for the first half amounted to $42.5m (£34.2m/€38.7m), compared to $47.2m last year, with new regulations in Sweden, Switzerland and the UK having an impact on this total.
Expenses were up 6% from $13.6m to $14.5m, mainly due to higher general and administration costs relating to changes in management and higher amortisation of capitalised R&D costs.
Gross profit was down from $31.7m to $28.8m in the half and this, coupled with lower revenue and higher expenses, meant profit before tax fell by 22% year-on-year from $17.6m to $13.8m.
Net income was also down by 14% year-on-year to $12.2m.
“This year has proven to be challenging for both XLMedia and the industry as a whole, as the gaming industry changes and regulates,” XLMedia’s chief executive Ory Weihs said.
“However, this does result in the Group having greater visibility, more sustainable revenues and stable earnings.
“Whilst we expect this disruption to continue in the midterm, we remain committed to our stated strategy, focusing on publishing.
“We continue to diversify our asset base, specifically developing our US gambling strategy and the personal finance sector, in which we continue to make good progress with this sector now accounting for 14% of the group's revenues.”
Weihs will next month step down as CEO at XLMedia, with Stuart Simms of Rakuten Marketing coming in to replace him.
“As my last address as CEO of XLMedia, I would like to wish Stuart every success and firmly believe that with the support of the board and management team he will lead the business back to sustainable growth,” Weihs said.