Esports Entertainment Group reported a significant increase in revenue, with a more than tenfold rise from $222,392 in the first quarter of the 2021 financial year. This growth followed the acquisition of online operator Argyll Entertainment in July 2020. The business saw a return to pre-Covid levels in October, with total handle surpassing $16 million for the month and gross gaming revenue (GGR) exceeding $700,000. In December, the total handle reached $20 million, resulting in revenue of over $850,000.
The operating expenses for the three-month period amounted to $8.1 million, marking a substantial increase compared to $700,000 for the same period in 2019. The rise can be attributed mainly to increased payroll, stock compensation, marketing, legal, and professional service fees associated with heightened business activity.
Despite experiencing a net loss of $7.3 million for the period, a 137.6% increase from the previous year, the group has raised its revenue guidance for 2020/2021 to $18 million, up from $13 million. This upward revision reflects the recent acquisitions of Lucky Dino, B2B software provider ggCircuit, and esports centre operator Helix eSports. Furthermore, including the acquisitions of Helix Esports and ggCircuit, the business is projecting $70 million in revenue in fiscal year 2022.
A notable development in January was the completion of the acquisition of Esports Gaming League (EGL), which subsequently led to partnership deals with renowned sports teams such as the Philadelphia Eagles, LA Kings, and LA Galaxy. EGL became the official esports tournament provider for these organizations.
To support its long-term business strategy, the group successfully raised $30 million in capital, providing resources for future growth. Grant Johnson, the chief executive of Esports Entertainment Group, expressed confidence in the company’s prospects, stating, “The foundation we have built is primed to generate rapid growth in the quarters ahead.”
Johnson further highlighted the positive impact of the Covid-19 pandemic on the esports sector, noting increased exposure on mainstream television and growing interest from professional sports franchises. With the recent capital raise, the company aims to accelerate the monetization of its three pillar strategy.
