Playmaker Capital Inc. Reports Second Quarter 2023 Results

Playmaker Capital Inc. (TSX-V: PMKR) (the “Company” or “Playmaker”), the digital sports media company that delivers authentic content experiences through its portfolio of sports media brands, is pleased to report its financial results for the second quarter ended June 30, 2023 (“Q2 2023”).

FINANCIAL HIGHLIGHTS (Figures in USD)

USD Millions	For the three months ended June 30
	2023		2022			Growth
Pro Forma Revenue1	$12.6		$8.3			53	%
Pro Forma Adjusted EBITDA1 (excl. Corporate segment)	$3.3		$2.6			24	%
Pro Forma Adjusted EBITDA1 (incl. Corporate segment)	$2.2		$1.6			34	%
Revenue	$12.6		$6.7			89	%
Operating Loss	($0.9	)	($0.5		)	-

• Cash and Cash Equivalents – Cash and cash equivalents were $9.7 million at June 30, 2023 compared to $11.4 million at March 31, 2023.

MANAGEMENT COMMENTARY

“Q2 was a period of focused execution against our five strategic priorities for 2023, all aimed at better integrating our complementary businesses to drive organic revenue growth and realize efficiencies. During the quarter, our ecosystem of media and affiliate businesses refined internal processes, expanded syndication networks, enhanced video production and monetization capabilities, and extended strategic partnerships with tier-one advertisers and sports betting operators. Entering the sports-heavy Q3 and Q4 periods, Playmaker is better positioned than ever to drive value for fans, customers, and shareholders.”

Jordan Gnat continued, “Subsequent to the quarter-end, we acquired leading Quebec sports media group, La Poche Bleue, to round out our Canada-wide reach. La Poche Bleue plants a flag in the Quebec market, bolsters our video podcast portfolio, and strengthens our direct-to-consumer segment in advance of the upcoming NHL season. Additionally, founders Maxim Lapierre and Guillaume Latendresse, and Managing Director, Louis-Philippe Dorais, are tremendous additions to our senior leadership team.”

Mike Cooke, CFO of Playmaker added, “Though Q2 falls during a quiet period in the sporting calendar, we are very excited to have delivered another quarter of strong top-line growth. Meanwhile, our consistent focus on profitability is reflected in continued growth in Adjusted EBITDA – and in the fact that we have generated $6.9 million of year-to-date cash flow from operating activities. With $9.7 million of cash at quarter-end and $20.0 million of available credit – including $10.0 million in a new credit facility closed subsequent to quarter-end – we are in a strong financial position to continue executing on our strategy as we head into the second half of 2023 and beyond.”

OPERATIONAL HIGHLIGHTS

Media Businesses Continue to Scale & Grow Engagement

Playmaker experienced strong engagement metrics across its owned and operated media brands in Q2 2023. During the quarter, Playmaker’s web properties generated more than 653 million sessions and its video podcasts received over five million streams. The Company’s North American footprint grew significantly in Q2 2023, and subsequent to the second quarter, Playmaker acquired Quebec sports and entertainment group, La Poche Bleue, to bolster its North American audience reach.

• Futbol Sites maintained a strong leadership position in the Brazilian market, with core properties Bolavip Brazil, Fanaticos Por Futebol, and Antenados no Futebol generating more than 300 million sessions in the quarter.
• The Nation Network continued to grow engagement with its lineup of video podcasts and achieved a quarterly record 5.1 million streams in Q2 2023, an increase of more than 300% over Q2 2022. In June 2023, TNN generated a monthly record 2.02 million streams.
• Yardbarker attracted a monthly average of 8.9 million unique users in Q2 2023, an increase of 52% over Q2 2022. Additionally, Yardbarker generated a monthly average of 19 million user sessions during Q2 2023, an increase of 51% year-over-year.
• Subsequent to Q2 2023, Playmaker expanded its North American reach with the acquisition of La Poche Bleue (“LPB”). The addition of LPB enabled Playmaker to establish a presence in Quebec to round out its Canada-wide reach. Additionally, LPB expanded Playmaker’s growing lineup of video podcasts ahead of the upcoming NHL season, and bolstered its direct-to-consumer business.

Strong Partnership Demand from Corporate Advertisers, Sports Betting Operators & Leagues

Playmaker executed multiple long-term direct sales and partnerships in Q2 2023. Direct sales accounted for 54% of Playmaker’s core media advertising sales for the period, an increase of 25% over Q2 2022. Direct sales and affiliate are growing segments of Playmaker’s revenue generation, and the Company continues to expand these revenue streams to maximize higher-margin monetization opportunities.

• Futbol Sites executed numerous direct campaigns with leading iGaming and sports betting operators in Brazil. Additionally, Futbol Sites activated campaigns with global advertisers across branded content articles, podcast and video integrations, and widgets. Futbol Sites Q2 2023 direct sales revenue increased by 53% over Q2 2022, bolstered by 88% year-over-year growth of the sports betting customer segment.
• Playmaker has identified its affiliate business as a high-growth opportunity, particularly in the U.S. market as additional states regulate online sports betting and iGaming. Playmaker’s Senior Leadership and Revenue Operations teams continued their integration efforts with its digital media businesses and Wedge in Q2 to unlock value by combining its vast audience with Wedge’s user acquisition and conversion expertise.
• Futbol Sites affiliate revenue increased 119% in Q2 2023 over Q2 2022, driven primarily by the sports streaming category in the US.
• The Nation Network extended partnerships with key sports betting operators for the upcoming 2023-24 NHL season. The campaigns will be activated across both web and podcast properties, including Daily Faceoff, FlamesNation, OilersNation, TheLeafsNation, and Coming In Hot, among others.

CONFERENCE CALL

The Company will host a management conference call to discuss its Q2 2023 financial results on August 15, 2023, at 10:00 a.m. (Eastern Time). Hosting the call will be Jordan Gnat, Chief Executive Officer; Jake Cassaday, Chief Operating Officer; and Mike Cooke, Chief Financial Officer.

To participate in the conference call, please access the webcast link or dial-in using one of the following numbers approximately five minutes prior to commencement and ask to join the Playmaker call:

Webcast: https://event.choruscall.com/mediaframe/webcast.html?webcastid=dwk76tV ...

Dial-In Number (Toll Free): 1-844-707-6933

Dial-In Number (International): 1-412-317-5796

A replay of the Conference Call will be made available at playmaker.fans/investors.

To sign up for Playmaker Investor Alerts, visit: PMKR Investor Alerts.

TSX VENTURE EXCHANGE DISCLAIMER

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

NON-IFRS MEASURES

Some of the information presented in this press release includes non-IFRS financial measures, including, “EBITDA”, “Adjusted EBITDA”, and metrics that are presented on a pro forma basis. These measures are not recognized measures under IFRS and do not have standardized meanings prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other companies. Rather, these measures are provided as additional information to complement IFRS measures by providing further understanding of the Company’s results of operations from management’s perspective. Accordingly, these measures should not be considered in isolation nor as a substitute for analysis of the Company’s financial information reported under IFRS.

“EBITDA” is earnings before interest, taxes, depreciation and amortization.

“Adjusted EBITDA incl. Corporate Segment” is earnings of the Company before interest, taxes, depreciation and amortization, excluding the impact of stock based compensation expenses, acquisition-related costs, and any other one-time costs. “Adjusted EBITDA excl. Corporate Segment” also excludes the impact of head office costs.”

“pro forma” is an adjustment to incorporate the results of any acquisitions and dispositions made through June 30, 2023, assuming each acquisition or disposition occurred on the first day of the period being presented.

FORWARD-LOOKING STATEMENTS

This press release may contain forward-looking information within the meaning of applicable securities legislation, which reflects Playmaker’s current expectations regarding future events. The words “will”, “expects”, “anticipates”, “believes”, “plans”, “intends” and similar expressions are often intended to identify forward-looking information, although not all forward-looking information contains these identifying words. Forward-looking information is based on a number of assumptions and is subject to a number of risks and uncertainties, many of which are beyond Playmaker’s control, which could cause actual results and events to differ materially from those that are disclosed in or implied by such forward-looking information. Such risks and uncertainties include, but are not limited to: changes in general economic, business and political conditions. Playmaker undertakes no obligation to update such forward-looking information, whether as a result of new information, future events or otherwise, except as expressly required by applicable law.

ABOUT PLAYMAKER CAPITAL INC.

Playmaker Capital Inc. (TSX-V: PMKR; OTC: PMKRF) is a digital sports media company that acquires and integrates premier fan-centric media brands, curated to deliver highly engaged audiences of sports fans to tier one advertisers, online sports betting operators, and sports federations and leagues. Leveraging its in-house technology stack, Bench, and with a 360-degree view of sports fans, Playmaker delivers authentic digital content experiences for sports fans and best-in-class results for its partners across the Americas.

Playmaker reports in U.S. dollars, except where noted otherwise, and in accordance with International Financial Reporting Standards (“IFRS”).

For more information, visit: http://www.playmaker.fans or contact Playmaker Chief Executive Officer Jordan Gnat via email [e-mail] | T: [phone]

To sign up for Playmaker’s Investor Alerts, visit: playmaker.fans/investors.

 

Playmaker Capital Inc.
Condensed Consolidated Interim Statements of Financial Position
(Stated in U.S. dollars)
			June 30,		December 31,
			2023		2022
			(Unaudited)		(Audited)
Assets
Current
	Cash and cash equivalents	$	9,688,561	$	8,875,692
	Accounts receivable		6,461,938		12,755,151
	Income taxes receivable		56,700		241,540
	Prepaid and other current assets		1,077,703		1,577,583
Total current assets			17,284,902		23,449,966
	Property and equipment		846,222		939,996
	Intangible assets		54,995,718		58,538,596
	Goodwill		45,350,872		46,098,848
	Deferred tax asset		1,774,074		1,734,875
	Other long-term assets		36,261		33,418
Total assets		$	120,288,049	$	130,795,699
Liabilities
Current
	Accounts payable	$	1,698,046	$	3,433,147
	Income taxes payable		108,234		725,925
	Deferred revenue		280,322		440,302
	Accrued expenses and other current liabilities		3,187,325		4,281,061
	Current portion of lease liability		161,776		157,150
	Current portion of long-term debt		1,666,667		416,667
	Current deferred consideration		1,591,000		2,000,000
	Consideration payable		17,566,483		11,804,338
Total current liabilities			26,259,853		23,258,590
	Long-term debt		8,333,333		9,583,333
	Long-term lease liability		348,308		425,181
	Deferred tax liability		7,221,060		7,297,935
	Deferred consideration		914,000		2,438,000
	Contingent consideration		8,114,400		17,957,182
	Convertible debenture		16,317,812		15,425,130
Total liabilities			67,508,766		76,385,351
Shareholders' Equity
	Share capital		66,356,487		65,816,073
	Contributed surplus		2,396,235		2,057,531
	Accumulated other comprehensive income (loss)		(3,142,682)		(1,735,978)
	Retained earnings (deficit)		(12,830,757)		(11,727,278)
Total shareholders’ equity			52,779,283		54,410,348
Total liabilities and shareholders’ equity		$	120,288,049	$	130,795,699

Playmaker Capital Inc.
Condensed Consolidated Interim Statements of Net Loss
Unaudited
(Stated in U.S. dollars, except share information)
			Three months ended June 30,				Six months ended June 30,
			2023		2022		2023		2022
Revenue		$	12,636,648	$	6,693,825	$	28,325,394	$	12,054,914
Cost of Sales			2,253,659		355,100		4,272,393		735,914
Gross Profit			10,382,989		6,338,725		24,053,001		11,319,000
Operating expenses
	Salary and wages		5,242,921		3,198,677		9,423,107		6,072,676
	Advertising, commissions and fees		2,511,379		1,198,608		5,800,599		1,677,411
	Web services and publishing		470,066		268,566		949,846		491,818
	General and administration		475,576		462,190		934,947		868,601
	Professional fees		442,873		211,180		802,359		673,222
	Stock-based compensation		313,537		370,719		618,944		584,529
	Depreciation and amortization		1,781,502		1,113,230		3,561,598		2,053,884
Total operating expenses			11,237,854		6,823,170		22,091,400		12,422,141
Operating income (loss)			(854,865)		(484,445)		1,961,601		(1,103,141)
	Transaction costs		(1,178)		(100,398)		(66,215)		(749,332)
	Interest expense		(627,155)		(92,720)		(1,154,625)		(103,203)
	Listing and filing fees		(6,159)		(5,786)		(12,294)		(11,613)
	Other income		24,217		4,454		46,354		12,277
	Other expenses		(9,909)		(59,539)		(21,630)		(71,765)
	Change in fair value of consideration		-		-		(166,930)		(1,896,772)
	Change in fair value of convertible debenture		(279,562)		-		(884,311)		-
	Foreign exchange gain (loss)		1,346,611		(139,514)		1,551,143		(276,828)
Income (loss) before taxes			(408,000)		(877,948)		1,253,093		(4,200,377)
	Current tax		77,748		(26,995)		(1,100,429)		(49,134)
Net income (loss) from continuing operations		$	(330,252)	$	(904,943)	$	152,664	$	(4,249,511)
Net loss from discontinued operations, after tax			(934,105)		(207,902)	$	(1,256,143)	$	(262,217)
Net loss		$	(1,264,357)	$	(1,112,845)	$	(1,103,479)	$	(4,511,728)
Basic net income (loss) per share from continuing operations		$	-	$	-	$	-	$	(0.02)
Diluted net income (loss) per share from continuing operations			N/A		N/A	$	-		N/A
Basic weighted average number of shares			227,607,955		215,158,590		227,033,486		213,863,106
Diluted weighted average number of shares			N/A		N/A		238,960,457		N/A

Playmaker Capital Inc.
Condensed Consolidated Interim Statements of Cash Flow
Unaudited
(Stated in U.S. dollars)
	For the six months ended June 30,
			2023		2022
Operating activities
	Net income (loss)	$	(1,103,479)	$	(4,511,728)
	Depreciation and amortization		3,561,598		2,064,703
	Stock based compensation		618,944		584,529
	Non-cash interest		17,850		8,648
	Loss on sale of technology segment, net of cash		781,936		-
	Change in fair value of contingent consideration		166,930		1,896,772
	Change in fair value of convertible debenture		884,311		-
	Foreign exchange (gain) loss		(1,529,048)		276,109
	Net change in non-cash working capital		3,521,381		(1,095,588)
Cash flows from (used in) operating activities			6,920,423		(776,555)
Investing activities
	Acquisition of Futmarketing		-		(875,000)
	Acquisition of SportsDrop		-		(1,200,000)
	Settlement of consideration		(5,927,503)		(7,393,636)
	Purchase of property and equipment		(92,505)		(109,076)
	Purchase of intangibles		(28,572)		(73,633)
Cash flows used in investing activities			(6,048,580)		(9,651,345)
Financing activities
	Warrants exercised		-		162,174
	Long-term debt drawn		-		6,000,000
	Long-term debt repayments		-		(111,112)
	Cash payment for lease liability		(92,850)		(96,839)
Cash flows used in financing activities			(92,850)		5,954,223
Increase (decrease) in cash			778,993		(4,473,677)
Foreign exchange impact			33,876		(159,811)
Cash, beginning of period			8,875,692		7,111,728
Cash, end of period		$	9,688,561	$	2,478,240

^{_________________________
1} Pro forma information includes the impact of all acquisitions & dispositions made through June 30, 2023. “Pro Forma Adjusted EBITDA” does not include impact of stock compensation, acquisition-related costs and other one-time costs. “Pro Forma Adjusted EBITDA (excl. Corporate segment)” also excludes the impact of head office costs.

View source version on businesswire.com: https://www.businesswire.com/news/home/20230814110083/en/

The Playmaker Capital Stock at the time of publication of the news with a raise of 0,00 % to 0,460CAD on TSX Venture stock exchange (14. August 2023, 21:08 Uhr).