Galaxy Gaming Reports Q3 2023 Financial Results

LAS VEGAS, Nov. 13, 2023 (GLOBE NEWSWIRE) -- Galaxy Gaming, Inc. (OTCQB: GLXZ), a developer and distributor of casino table games and enhanced systems for land-based casinos and iGaming content, announced today its financial results for the quarter and nine months ended September 30, 2023.

Financial Highlights

Q3 2023 vs. Q3 2022

• Revenue increased 3% to $6,104K
• Adjusted EBITDA decreased 36% to $1,510K
• Net loss of $(1,455)K vs. net loss of $(699)K
  

Nine months 2023 vs. Nine Months 2022

• Revenue increased 20% to $21,052K
• Adjusted EBITDA increased 6% to $7,807K
• Net loss of $(988)K vs. net loss of $(1,828)K
  

Balance Sheet Changes (vs. December 31, 2022)

• Cash decreased 13% to $15,938K
• Total long-term debt¹ (gross) decreased to $58,673K from $59,740K
• Stockholders’ deficit increased to $(18,077)K from $(17,885)K
  

Executive Comments

“Despite some challenges in the third quarter, 2023 is shaping up to be a record year for Galaxy,” said Todd Cravens, President and CEO. “We had a sequential decline in revenue in Q3 principally because sales of perpetual licenses were lower in Q3 than in Q1 and Q2. We expect that future sales of these perpetual licenses will make our quarterly results lumpier than in the past. However, we will continue to pursue these sales as they result in substantial increases to our installed base and offer additional recurring revenue opportunities.

“Galaxy became the distributor of EZ Baccarat^TM on September 9 and added approximately 500 tables in approximately 120 casinos to our installed base. This is a significant step in our strategic plan of penetrating other table games families in addition to blackjack. Based on the existing installed base, we believe that the distribution of EZ Baccarat could add more than $3 million to our EBITDA on an annual basis, with upside coming from new installs both in the land-based and online markets.

“Finally, we had our best G2E show ever, setting us up for increased revenue in fiscal 2024,” concluded Cravens.

“Perpetual license sales were $0.5 million in Q3 as compared to $1.3 million and $1.6 million in Q1 and Q2, respectively,” said Harry Hagerty, CFO. “Excluding those sales, revenue in GG Core was $3.8 million in Q3 ‘23 as compared to $3.9 million in Q3 ‘22. In GG Digital, revenue (net) was $1.8 million in Q3 ‘23 as compared to $2.0 million in Q3 ‘22. GG Digital revenues in Q3 ‘23 exclude approximately $69,000 of deferred revenue that will be realized no later than April of 2024. Gross revenues were flat at $2.5 million in Q3 ‘23 as compared to the same period in 2022, which is a positive result given the reduced license rate we now have with a large customer. Royalty expense (which is a contra revenue item in GG Digital) increased from approximately $516,000 in Q3 ‘22 as compared to approximately $734,000 in Q3 ‘23, reflecting the growth of a game that we license from a third party.