REG - B90 Holdings PLC - Final Results
16/05/2024 07:00
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RNS Number : 6336O B90 Holdings PLC 16 May 2024
For release: 07.00, 16 May 2024
B90 Holdings plc
("B90", the "Company" or "Group")
Final Results for the Year Ended 31 December 2023
Transformation completed in 2023 - EBIDTA positive in Q1 FY2024
B90 Holdings plc (AIM: B90), the online marketing and service provision
company for the gaming industry, is pleased to announce its audited Final
Results for the year ended 31 December 2023.
The 2023 Annual Report is being sent to shareholders and can be found on the
Company's website at: www.b90holdings.com (http://www.b90holdings.com)
Commenting on the results, Executive Chairman, Ronny Breivik, said:
"2023 was the year in which we transformed B90. These efforts have paid off
and the Company has been EBITDA positive numbers for every month in Q1 of
FY2024.(( 1 (#_ftn1) ))
"We have successfully implemented a realignment of our strategic vision,
carried out an operational shift, strengthened our balance sheet and
successfully acquired and integrated the operations of Emwys, which bolstered
our digital marketing capabilities. The transition towards a core B2B model
has been underscored by the relaunch of our flagship brand, www.bet90.com
(http://www.bet90.com/) .
"We are now fully focused on our B2B performance marketing strategy,
positioning us as a leader in online marketing and service provision within
the dynamic and exciting gaming industry."
Business Turnaround:
· Major restructuring of casino and sportsbook operations towards
outsourced solutions, to focus on core strengths therefore creating financial
and operational efficiencies.
· Continued emphasis on B2B operations.
· Post period performance shows EBITDA profitability in Q1 2024 with
positive EBITDA each month in the quarter.(1)
Financial Highlights:
· Revenue for the year ended 31 December 2023 increased to €3.0
million, from €2.1 million in 2022, indicating progress from strategic
shifts.
· Net loss increased year-over-year from €4.3 million to €5.5 million,
due to impairment charges relating to Bet90.com, the financial treatment of
the Convertible Loan Note, increased expenses paid to Payment Service
Providers in the operations of Bet90 and Spinbookie and additional marketing
spend.
· Successfully raised €6.6 million, before transaction costs, through
convertible loan notes and equity placements, bolstering financial
flexibility, improving working capital and strengthening the balance sheet.
Operational Highlights:
· Strategic pivot from B2C to a B2B focus, optimising operations around
performance marketing and affiliate services.
· Brand relaunch of www.bet90.com (http://www.bet90.com/) as an
affiliate website, reducing operating costs and enhancing focus.
· Successful acquisition and integration of Emwys to bolster digital
marketing capabilities within the online gambling sector.
· Over 200 partnerships established with major industry players such as
Bet365 and ComeOn Group, enhancing market presence.
Strengthened Management Team, and Advisory and Main Boards:
· Appointment of industry veteran Andrew McIver to the Board, and the
appointment of Mark Blandford as strategic adviser, strengthened strategic
oversight and operational capabilities.
· For over a decade, Andrew was on the board of Sportingbet plc, first
as Chief Financial Officer and then as Group Chief Executive Officer
· Mark is a senior industry figure and considered by many to be one of
the founders of the developed online gaming industry.
Commenting on Summary and Outlook, Ronny Breivik, concluded:
"Looking ahead, we are very optimistic about the future of B90. Management
delivered on several key operational milestones during 2023, which are
expected to help the Group achieve profitability in 2024. Our refocus on B2B
operations, coupled with a strong management team and Board, and a much
stronger balance sheet, positions us well to achieve our goal of returning to
profit, realising substantial potential for driving shareholder value."
"Our efforts to reduce operating costs and leverage our new business model
have already resulted in much improved EBITDA over the first quarter of
2024. During the first three months of 2024, the Group has recorded positive
EBITDA(1) every single month. In January 2024, we partnered with a specialised
platform and operations partner - and we are now fully focused on our
performance marketing strategy."
"We are grateful for the continued support of our shareholders and are excited
about the opportunities ahead. Our commitment to growth, operational
excellence, and financial discipline will guide our efforts as we aim to
deliver long-term value to our stakeholders".
(( 1 ))Unaudited
-Ends-
For further information please contact:
B90 Holdings plc +44 (0)1624 605 764
Ronny Breivik, Executive Chairman
Marcel Noordeloos, Finance Director
Strand Hanson Limited (Nominated Adviser) +44 (0)20 7409 3494
James Harris / Richard Johnson / Rob Patrick
Zeus Capital Limited (Broker) +44 (0)20 3829 5000
Louisa Waddell / Simon Johnson
Belvedere (Financial PR & IR) +44 (0)20 7653 8702
John West / Llewellyn Angus / Lily Pearce
Strategic Report
CHAIR'S STATEMENT
Introduction
As the Executive Chairman of B90 Holdings plc (AIM: B90), I am pleased to
present our annual results for the year ended 31 December 2023. This year has
been transformative for B90, characterised by significant strategic
initiatives that have strengthened our foundation for future growth. The
year's achievements reflect our commitment to operational excellence,
strategic acquisitions, and a pivot towards a more sustainable and profitable
business model.
Our focus has been on successfully implementing a bold realignment of our
strategic vision and carrying out an operational shift. The transition towards
a core business-to-business (B2B) model has been underscored by the strategic
relaunch of our flagship brand, www.bet90.com (http://www.bet90.com/) .
Our Company is now fully focused on its B2B performance marketing strategy,
positioning us as a leader in online marketing and service provision within
the dynamic and exciting gaming industry.
Strategic Realignment and Operational Efficiency
Our carefully executed pivot from a business-to-consumer (B2C) model to a
dedicated B2B approach was driven by the need to harness our core strengths in
performance marketing, lead generation, and affiliate services more
effectively. This decision was not taken lightly; it has been the culmination
of an in-depth analysis of market trends, our proven strengths, and our
long-term growth objectives. The relaunch of Bet90.com as an affiliate website
has not only streamlined our operational focus but also significantly reduced
our operating costs, leading to a leaner and focused organisation.
The establishment of over 200 partnerships with industry giants such as
Bet365, Unibet and ComeOn Group, amplifies our success in and commitment to
this new direction. These partnerships are not just numbers; they represent
the depth of our market penetration and the strength of our value proposition
to business partners and stakeholders.
Financial and Operational Overview
The financial year 2023, while challenging, laid the groundwork for
stabilising our financial performance, with a clear and exciting path now
ahead of us. Our operational milestones, including the successful acquisition
of Emwys AB and the strategic restructuring of our casino and sportsbook
operations, reflect our commitment to operational efficiency and core
competencies. Despite the costs associated with these transformative actions,
we have seen a stabilising trend in our financial performance, with strong
indications of growth as we enter 2024.
Our emphasis on strategic marketing investments and the integration of key
acquisitions, such as Emwys, are set to drive significant future revenue
growth. Emwys bolsters our digital marketing capabilities; and these strategic
decisions, although impactful on our short-term financials, are investments in
our long-term vision of becoming a scalable and profitable gaming marketeer
and lead generator.
Fundraisings and Strategic Investments
Our ability to have successfully raised over €6.6 million through
convertible loan notes and equity placements during 2023 speaks volumes about
the confidence our investors have in our stated direction and leadership.
These funds have been instrumental in supporting our carefully considered
acquisitions, enhancing our operational capabilities, and providing the
financial flexibility needed to navigate through this transformative period.
These funds have not only been used to support our acquisition strategy, but
also to enhance our balance sheet, and provide the financial flexibility and
working capital needed to execute our business plan efficiently.
Operating Review
The main focus during the year was the strategic shift and business model
transformation referenced above. The realignment towards B2B operations has
been a cornerstone of our efforts this year.
The relaunch of Bet90.com as an affiliate website is a testament to our
commitment to this new direction. This move not only streamlines our
operations but also positions us for sustainable growth and profitability. Our
focus on expanding our marketing capabilities and driving future revenue
growth through affiliate partnerships underlines our ambition to be at the
forefront of the gaming marketing and lead generation market.
Historically, B90 operated across two main areas: lead generation through
Search Engine Optimisation ("SEO") and, since the acquisition of Emwys in July
2023, Pay-Per-Click marketing solutions, and the provision of online gaming
products. This dual focus allowed us to generate revenue through affiliate
agreements with third-party operators while offering direct gaming services.
However, in recognising the evolving dynamics of the gaming industry and the
need for a more focused and sustainable growth strategy, we embarked on a
reconstructive plan of action for the Company.
As highlighted above, the relaunch of Bet90.com as an affiliate website marks
a significant pivot from our previous business-to-consumer (B2C) model to a
dedicated B2B approach. This strategic realignment allows us to concentrate on
our strengths in performance marketing, lead generation, and affiliate
services, thereby enhancing our value proposition to business partners and
stakeholders. By discontinuing B2C gambling operations on Bet90.com, we have
not only streamlined our operational focus but also significantly reduced our
operating costs.
Our operations, including those of Emwys and www.oddsen.nu, have aligned
seamlessly with our strategic direction, further establishing B90 as a key
player in affiliate marketing within the Nordic region, and beyond.
The year 2023 was also marked by other key operational milestones, including
the restructuring of our casino and sportsbook operations towards an
outsourced solution, enhancing our efficiency and allowing us to focus on core
competencies. This strategic shift, coupled with our successful fundraising
activities and strengthening of the management team and Board, has laid a
solid foundation for B90's future growth.
Our commitment to this new direction is not just about operational efficiency;
it is about building a business that aspires to be at the forefront of the
gaming marketing and lead generation market, targeting profitability and
positive free cash flow. We are confident that our strategic focus on B2B
operations, enhanced by our industry experience and strengthened by practical
guidance from seasoned investors, positions B90 for a future of sustainable
growth and shareholder value creation.
Financial Review
Financially, last year was challenging, with a net loss reflective of the
strategic investments and one-off expenses associated with our transformative
initiatives. However, these investments are already showing promise, with a
reduction in operating costs and improved revenue and EBITDA for the first
quarter of FY2024. Our focus on strategic marketing investments and the
successful integration of acquisitions are expected to drive significant
revenue growth and a return to profitability.
Our financial performance for the year reflects the actions we have
undertaken, set against the backdrop of realignments and investments aimed at
long-term growth:
· Revenue Performance: €3.0 million compared to €2.1 million in
2022, a reflection of our strategic shift and the initial impacts of our
operational realignment.
· Net Loss: €5.5 million compared to €4.3 million in 2022,
indicative of the transitional phase we are in, with strategic investments
poised to yield future profitability.
· Strategic Marketing Investments: €1.6 million compared to €0.8
million in 2022, underscoring our commitment to driving growth through focused
marketing initiatives.
· Successful Fundraising: With a total of €6.6 million raised in
this financial year, we have significantly enhanced our financial flexibility,
enabling us to pursue our strategic objectives with greater confidence.
2023 2022
Net Loss (5,470,603) (4,268,196)
Amortisation & Depreciation 606,475 462,205
Impairment of Goodwill 315,611 1,095,320
Stock option expense 402,384 349,364
Interest and other finance expense 887,716 35,833
Tax (4,462) (13,680)
EBITDA (3,262,879) (2,339,154)
One-off expenses:
- Restructuring expenses 237,356 129,152
- EGM expenses - 83,908
Adjusted EBITDA (3,025,523) (2,126,094)
Strategic Acquisition Amplifies Marketing Capabilities
The acquisition of Emwys AB represents a significant milestone in our planned
expansion, bringing specialised digital marketing expertise within the online
gambling sector into our portfolio. This move not only augments our marketing
capabilities but also sets the stage for future revenue growth through
carefully considered affiliate partnerships. Our strategy, a 'buy and
build' approach, continues to drive our evolution and market penetration. We
continue to be open to new acquisition opportunities and focus on organic
expansion, leveraging partnerships with businesses that seek our operational
expertise and distribution capabilities.
Board Changes, Management Team Enhancements and Appointment of Strategic
Adviser
The strategic enhancements to our board and management team have been a key
component of our success this year. The appointments of industry veterans such
as Andrew McIver and Mark Blandford, coupled with my transition to Executive
Chairman and Marcel Noordeloos committing to continue in the role of CFO, have
significantly strengthened our strategic oversight and operational
capabilities. Their combined experience and insights have been invaluable as
we navigate through these changes, ensuring that we remain focused on our
long-term objectives.
Andrew McIver was appointed to the Board on 14 August 2023 as an independent
non-executive Director. He has long been involved with a host of successful
gaming businesses and, for the last three years, has been Non-Executive
Chairman of a leading Italian gambling company, Planet Win/SKS365 Malta Ltd,
as it has grown its EBITDA from €25 million to €65 million.
Andrew's wider experience is invaluable to us. From mid-2016 to early 2018,
he was Group Chief Executive of Jackpotjoy plc, one of the world's largest
online bingo companies at the time, with an EBITDA of €100 million. Prior
to this, and for over a decade, Andrew was on the board of Sportingbet plc,
first as Chief Financial Officer and then as Group Chief Executive Officer,
overseeing its eventual sale to a consortium of William Hill and Entain for
over £500 million in 2013. He began his career as a Chartered Accountant with
Arthur Andersen.
In February 2023, we announced that Mark Blandford had invested in our
business and since then has acted as a strategic adviser to the Company.
Mark is a senior industry figure and considered by many to be one of the
founders of the developed online gaming industry. He has pioneered the
development, financing, and monetising of digital Pay2Play entertainment
companies over the last fifteen years, and having worked with him previously
at Sportingbet, I am extremely pleased with his investment in B90 and his
strategic guidance. His experience, market insight and knowledge, as well as
his network of contacts, make a big difference to our capabilities.
Following the above changes, the Directors believe the Board composition, in
combination with the appointment of Mark Blandford to advise on strategy, is
now appropriately structured to facilitate the Company's growth into the next
phase.
Summary and Outlook
Looking ahead, we are very optimistic about the future of B90. Management
delivered on several key operational milestones during 2023, which are
expected to help the Group achieve profitability in 2024. Our refocus on B2B
operations, coupled with a strong management team and Board, and a much
stronger balance sheet, positioned us well to achieve our goals of returning
to profit, realising substantial potential for driving shareholder value. Our
efforts to reduce operating costs and leverage our new business model have
already resulted in much improved EBITDA over the first quarter of FY2024.
During the first three months of 2024, the Group has recorded a positive
unaudited EBITDA every single month, allowing us to report an EBITDA
profitable Q1 of 2024. In January 2024, the Company partnered with a
specialised platform and operations partner - and we are now fully focused on
our performance marketing strategy.
We are grateful for the continued support of our shareholders and are excited
about the opportunities ahead. Our commitment to growth, operational
excellence, and financial discipline will guide our efforts as we aim to
deliver long-term value to our stakeholders.
Ronny Breivik
Executive Chairman
B90 Holdings plc
Directors' Report
The Directors present the Company's report and consolidated financial
statements for the year ended 31 December 2023.
Principal activities and review of the business
B90 Holdings plc is the parent company of a group focused on sports betting
operations and casinos games via its wholly owned Bet90 and Spinbookie
operations, as well as generating marketing leads and entering into marketing
contracts for the activities of its partners in sports betting and casino
games, using its wholly owned brands Oddsen.nu (which has its main focus on
Norway) and Tippen4you.com (with a focus on Germany) and using Google Pay Per
Click via its newly acquired Emwys AB.
Results and dividends
The Group's results for the year, after taxation, amounted to a loss of €5.5
million (2022: loss of €4.3 million).
As a result of the above, the Directors are proposing not to pay a dividend
for the year ended 31 December 2023 (2022: nil).
Future developments
Future developments are discussed in the Strategic Report.
Financial Risk Management
The Board is responsible for setting the objectives and underlying principles
of financial risk management for the Group. The Board establishes the
detailed policies such as authority levels, oversight responsibilities, risk
identification and measurement and exposure limits.
Capital risk management
The Group's objectives when managing capital are to safeguard the Group's
ability to continue as a going concern in order to provide returns for
shareholders.
Liquidity risk
Liquidity risk exists where the Group might encounter difficulties in meeting
its financial obligations as they become due. The Group monitors its
liquidity in order to ensure that sufficient liquid resources are available to
allow it to meet its obligations.
Large wins by customers
Inherent to the business is that there is a risk that a few players and
customers might win significant amounts of money during the same period thus
reducing the earnings of the Group, in particular in regard to its sportsbook
partner which has a higher concentration of VIP players. In respect of its
marketing activities for its sportsbook partner, negative net commission
revenues in any period are carried forward and netted off against positive net
commission revenues in future periods on which commission might otherwise be
payable to the Group. Whilst the Group would not have to cover any gaming or
gambling losses in the existing marketing agreements, the percentage of
earnings retained by the Group might be greatly reduced as a result of this.
Gaming or gambling losses within the Group's own operations would need to be
covered by the Group as and when they occur. The Group must at all times have
sufficient cash balances available to cover liabilities to customers. In the
case of a large win by a customer, the Group would need to move funds from its
current account to the accounts that cover the liability to customers, which
would immediately negatively impact the Group's working capital and its
earnings for the period.
Currency risk
Given the expansion in the Nordics and Latin America, the Group is exposed to
foreign exchange gains and losses on its trading activities. Due to the
current size of the Group, it does not actively hedge the foreign exposure on
its trading cashflows. It monitors exposures to individual currencies, taking
remediating actions as necessary to manage any significant risks as they
arise.
Interest rate risk
The Group's exposure to upside interest rate risk is limited. The Company has
limited interest bearing liabilities on the statement of financial position.
Therefore, the Directors do not consider the impact of possible interest rate
changes based on current market conditions to be material to the net result
for the year or the equity position as at 31 December 2023.
Credit risk
The Group's credit risk is primarily attributable to trade receivables and
cash and cash equivalents.
● Receivables: Customers, being third party sportsbook and
casino operators. The Group generates commission revenues via its affiliate
operations. Commissions invoiced are payable within a month after the month
invoiced.
● Cash and Cash equivalents: Payment service providers (PSPs).
PSPs are third-party companies that facilitate deposits and withdrawals of
funds to and from customers' virtual wallets with the Group. These are
mainly intermediaries that transact on behalf of credit card companies.
The risk is that a customer or a PSP would fail to discharge its obligation
with regard to the balance owed to the Group.
The Group reduces this credit risk by:
● Monitoring balances with customers on a regular basis;
● Monitoring balances with PSPs on a regular basis; and
● Arranging for the shortest possible cash settlement
intervals with their PSPs.
The Group considers that based on the factors above and on past experience,
the customers and PSP receivables used in the current businesses are of good
credit quality and there is a low level of potential bad debt as at year-end.
An additional credit risk the Group faces relates to customers in its own
operations disputing charges made to their credit cards ("chargebacks") or any
other funding method they have used in respect of the services provided by the
Group. Customers may fail to fulfil their obligation to pay, which will
result in funds not being collected. These chargebacks and uncollected
deposits, when occurring, will be deducted at source by the payment service
providers from any amount due to the Group. The Group monitors the need for
impairment provisions by considering all reasonable and supportable
information, including that which is forward-looking. For the year ended 31
December 2023, the Group has not made any provision for this, as any provision
would be immaterial.
Regulatory risk
Regulatory, legislative and fiscal regimes for betting and gaming in key
markets can change, sometimes even at short notice. Such changes could benefit
or have an adverse effect on the Group's operations and additional costs might
be incurred in order to comply with any new laws or regulations in various
jurisdictions.
The Group closely monitors regulatory, legislative and fiscal developments in
key markets allowing the Group to assess, adapt and takes the necessary action
where appropriate. Management takes external advice, which incorporates risk
evaluation of individual territories. Regulatory updates are provided to the
Board when changes are announced.
Whilst changing regulatory and tax regimes can offer opportunities to the
Group as well as posing risks, a significant adverse change in jurisdictions
in which the Group operates could have a significant impact on the Groups
future profitability and cash generation.
Going concern
Although the Group has increased revenues by c. 41% to €3.0 million, the
Group still operated at a loss in 2023. While the directors believe the
acquisition completed in 2023 (Emwys AB) will drive increased revenues in the
foreseeable future, the reported net loss for the year ended 31 December 2023
amounts to €5.5 million.
As at 31 December 2023, the Group shows total current liabilities of €2.3
million and a negative working capital position of €1.0 million. Whilst the
Directors believe that its revised strategy will show a significant increase
in revenues and in profitability, there is no guarantee that this will lead
the Group to become cash flow positive during 2024 and thus ensure sufficient
cash is available to meet its liabilities as they fall due in the foreseeable
future being the next 12 months from the date of signing these financial
statements.
Should trading not be in line with management's expectations going forward,
the Group's ability to meet its liabilities may be impacted, in which case the
Group may need to raise further funding. In such circumstance that further
funds are needed and whilst the directors are confident of being able to raise
such funding if required, there is no certainty that such funding will be
available and/or the terms of such funding. These conditions are necessarily
considered to represent a material uncertainty which may cast significant
doubt over the Group's ability to continue as a going concern.
Whilst acknowledging this uncertainty, the Directors remain confident that the
recent changes will allow the Group to expand its operations and generate a
positive operational cash flow within a reasonable time or, if needed, be able
to raise additional funding when required; therefore the Directors consider it
appropriate to prepare the financial statements on a going concern basis.
The financial statements do not include the adjustments that would result if
the Group was unable to continue as a going concern.
Subsequent events
On 1 February 2024, the Company announced that it had successfully completed
the transition of the operations, including partnering with a specialised
platform and operations partner, for the Spinbookie operations.
Director's interests
The following Directors held shares and share options as at 31 December 2023:
Number of shares held Number of options Exercise Date of grant Vesting period
Price (£) of options of options
Ronny Breivik 30,967,780* 3,000,000 0.130 1 October 2021 1-4 years
Ronny Breivik - 3,000,000 0.062 18 April 2023 1-4 years
Marcel Noordeloos 3,659,954 2,100,000 0.050 17 March 2021 1-4 years
Marcel Noordeloos - 3,000,000 0.130 1 October 2021 1-4 years
Marcel Noordeloos - 3,000,000 0.062 18 April 2023 1-4 years
Mark Rosman 23,419,019 550,000 0.150 14 February 2019 1-4 years
Mark Rosman - 3,000,000 0.130 1 October 2021 1-4 years
Martin Fleisje - 750,000 0.062 18 April 2023 1-4 years
Andrew McIver - 1,000,000 0.050 27 October 2023 1-4 years
*This includes a 34.65% ownership by Ronny Breivik in Performance Media Ltd, a
company that owns 31,084,450 shares in the Company and the shares held by
Entercreation Ltd, a company that owns 8,600,000 shares in the Company.
All options expire on the 5(th) anniversary of grant.
Directors who served during the year
Appointed Resigned
Ronny Breivik 7 November 2022 -
Mark Rosman 19 March 2014 -
Marcel Noordeloos 30 June 2016 -
Martin Fleisje 7 November 2022 -
Andrew McIver 14 August 2023 -
The details of the Directors' remuneration have been included within note 5 on
page 39 of this annual report.
Directors' responsibilities
The Directors are responsible for preparing the annual report and the
financial statements in accordance with applicable law and regulations.
Company law requires the Directors to keep reliable accounting records which
allow financial statements to be prepared. In addition, the Directors have
elected to prepare group financial statements in accordance with International
financial reporting standards (''IFRS") as adopted by the European Union.
The financial statements are required to give a true and fair view of the
state of affairs of the Group and of the profit or loss of the Group for that
year. In preparing these financial statements, the Directors are required
to:
● select suitable accounting policies and then apply them
consistently;
● make judgments and accounting estimates that are reasonable and
prudent;
● state whether applicable IFRSs have been followed, subject to
any material departures disclosed and explained in the financial statements;
and
● prepare the financial statements on the going concern basis
unless it is inappropriate to presume that the Group will continue in
business.
The Directors are responsible for keeping adequate accounting records that are
sufficient to show and explain the Group's transactions and disclose with
reasonable accuracy at any time the financial position of the Group and
prepare financial statements. They are also responsible for safeguarding the
assets of the Group and hence for taking reasonable steps for the prevention
and detection of fraud and other irregularities.
The Directors are also responsible for ensuring that they meet their
responsibilities under the AIM Rules.
The Directors are responsible for the maintenance and integrity of the
corporate and financial information included on the company's website.
Legislation in the Isle of Man governing the preparation and dissemination of
financial statements may differ from legislation in other jurisdictions.
In so far as each of the Directors is aware:
● there is no relevant audit information of which the Group's
auditors are unaware; and
● the Directors have taken all steps that they ought to have taken
to make themselves aware of any relevant audit information and to establish
that the auditor is aware of that information.
Significant shareholders
As at the date of this report, the Company is aware of the following
shareholdings of 3% or more of the Company's issued share capital:
Name Ordinary shares % of total issued share capital
Winforton Investments Ltd 85,520,000 19.5%
P. Westerterp 37,842,240 8.6%
Funko International AB 29,312,547 6.7%
Performance Media SIA 28,784,449 6.6%
(34.65% owned by R. Breivik)
Diman BV 25,178,432 5.7%
H.M. Hansen 23,907,004 5.4%
M. Rosman 23,419,019 5.3%
Ulen Holdings 22,352,265 5.1%
Ronny Breivik 20,197,047 4.6% (7.0% including Perf.Media shares)
Auditors
The auditors of the Group are CLA Evelyn Partners Limited, Chartered
Accountants, who were reappointed at the 2023 Annual General Meeting and will
be proposed to be reappointed at the 2024 Annual General Meeting.
Principal risks and uncertainties
The Board evaluates the operational risks facing the Group on an ongoing basis
to monitor for changes in risks and risk impact and to set guidelines for risk
mitigation. The most significant risks identified by the Board are listed
below.
Gambling laws and regulations are constantly evolving and increasing
The regulatory framework of online gaming is dynamic and complex. Change in
the regulatory regime in a specific jurisdiction can have a material adverse
effect on business volume and financial performance in that jurisdiction. A
number of jurisdictions have regulated online gaming, and in several of those
jurisdictions the Group, or its operating partner, either holds a licence or
is planning to obtain one, if the market is considered commercially viable.
However, in some cases, lack of clarity in the regulations, or conflicting
legislative and regulatory developments, mean that the Group may risk failing
to obtain an appropriate licence, having existing licences adversely affected,
or being subject to other regulatory sanctions, including internet service
providers blocking, blocking options to make deposits, black-listing the Group
and fines.
The Group is managing this risk by consulting with legal advisers in various
jurisdictions where its services are marketed or which generate, or may
generate, significant revenue for the Group. Furthermore, the Group obtains
regular updates regarding changes in the law that may be applicable to its
operations, working with local counsel to assess the impact of any changes on
its operations. Furthermore, the Group's owned operations Bet90 and
Spinbookie, blocks players from certain "blocked jurisdictions" using multiple
technological methods as appropriate.
Reliance on VIP players
Although the focus of the Group is primarily on the operations of its own
brands, a large percentage of the commission-based revenue from the Group's
marketing activities in the sportsbook and casino vertical is generated by a
small group of high net worth players, described as "VIP Players". These are
loyal players that regularly deposit high amounts on the websites. These
deposit levels vary per country and are typically the top 5% of the players
making regular deposits. The Group knows these players and makes them feel
valued, in efforts to remain an active player. A VIP player (or also a
non-VIP player) can have large winnings, in either the sportsbook or the
casino, in a certain period, which can significantly impact the revenues on a
monthly basis. A loss of any of the VIP Players could significantly
adversely affect the Group's business, financial condition, results or future
operations.
In respect of its own sportsbook and casino brands, Bet90 and Spinbookie, any
large wins by VIP players could potentially lead to recording a loss in such
cases. The Group has Terms & Conditions in place to limit the daily win of
a single player to mitigate such a risk.
Imposition of additional gaming or other indirect taxes
Revenues earned from customers located in a particular jurisdiction may give
rise to further taxes in that jurisdiction. If additional taxes are levied,
this may have a material adverse effect on the amount of tax payable by the
Group. Further taxes may include value added tax (VAT) or other indirect
taxes. The Group may be subject to VAT or similar taxes on transactions, which
have previously been treated as exempt.
The Group seeks to include geographical diversity in its operations. In order
to mitigate the risks that arise, the Group actively identifies, evaluates,
manages and monitors its tax risks and the geographies in which it operates.
The Group works with external local tax advisers to assist them in this
process.
Information Technology and Cyber risks
The Group uses third party service providers for its operations. The
third-party IT systems may be impacted by unauthorised access, cyber-attacks,
DDoS (Distributed Denial of Service) attacks, theft or misuse of data by
internal or external parties, or disrupted by increases in usage, human error,
natural hazards or disasters or other events. Cyber-attack and data theft
incidents may expose the Group to "ransom" demands and costs of repairing
physical and reputational damage. Failure of third-party IT systems,
infrastructure or telecommunications may cause significant cost and disruption
to the business and harm revenues. Lengthy down-time of the site (including in
transitioning to activated disaster recovery servers) could also cause the
Group to breach regulatory obligations.
Data protection risk
The Group and its third-party service providers processes personal customer
data, including sensitive data such as name, address, age, bank details and
gaming / betting history. Such data could be wrongfully accessed or used by
employees, customers, suppliers or third parties, or lost, disclosed or
improperly processed in breach of data protection regulations. In particular,
the European General Data Protection Regulation ("GDPR") entered into force in
May 2018, its equivalent in the UK ("UK GDPR"), having a significant effect on
the Group's privacy and data protection practices, as it introduced various
changes to how personal information should be collected, maintained, processed
and secured. Non-compliance with the GDPR or UK GDPR may result in fines of
the higher of €20 million or 4% of the Group's annual global turnover, and
the Group will be particularly exposed to enforcement action in light of the
amount of customer data it holds and processes. In addition, various countries
in the EU have introduced domestic data protection laws incorporating the GDPR
requirements. Moreover, the Group makes use of various tracking technologies
(such as cookies, SDKs, JavaScript and other forms of local storage), which
are subject to stricter standards of consent and transparency, both under the
GDPR and the e-Privacy Directive. The Group could also be subject to private
litigation and loss of customer goodwill and confidence.
Corporate Governance Report
As an AIM-quoted company, B90 is required to apply a recognised corporate
governance code, demonstrating how the Group complies with such corporate
governance code and where it departs from it.
The Board of Directors of the Company ("Directors" or "Board") have adopted
the QCA Corporate Governance Code (the "QCA Code"). The Board recognises the
principles of the QCA Code, which focus on the creation of medium to long-term
value for shareholders, without stifling the entrepreneurial spirit in which
small to medium sized companies, such as B90, have been created.
Application of the QCA Code
In the spirit of the QCA Code, it is the Board's job to ensure that the Group
is managed for the long-term benefit of all shareholders and other
stakeholders with effective and efficient decision-making. Corporate
governance is an important part of that job, reducing risk and adding value to
the Group. The Board will continue to monitor the governance framework of the
Group as it grows.
B90 is an online marketing and operating company that seeks to grow
shareholder value through organic growth and acquisitions. B90's aim is to
build a portfolio of brands in the gaming industry through a combination of
strong organic growth as well as strategic acquisitions that complement the
current business.
The Board aims to achieve these objectives through the adoption of best
working practices and by leveraging its industry knowledge and expertise. We
believe that the senior management team as well as the Board, together with
their industry leading partners and networks, have the necessary capabilities
to achieve organic and external growth in the future, as demonstrated, for
example, by the previous acquisition of Spinbookie.com in December 2021, an
operating online sportsbook and casino. Furthermore, the Group acquired the
operations of Oddsen.nu in September 2021, the remaining unowned minority
interest in Tippen4you.com and recently Emwys AB, a Swedish PPC advertising
company, to own its own affiliation networks and driver further revenues via
these portals.
In accordance with the AIM Rules, B90 applies (and in some cases departs from)
the QCA Code in the following way:
Principle 1 - Establish a strategy and business model which promote long-term
value for shareholders
B90 is an online marketing and operating company in the gaming sector that
seeks to grow shareholder value through organic growth and acquisitions, key
aspects of which are ensuring customer satisfaction on both a B2B and B2C
basis and strengthening the B90 owned brands (see also page 7, Principal
activities and review of the business).
Principle 2 - Seek to understand and meet shareholder needs and expectations.
B90 has engaged in active dialogue with shareholders through regular
communication and the Company's Annual General Meeting and one-on-one
discussions. New information is released via the regulatory news service (RNS)
before anywhere else and the website is updated accordingly (see also page
3-6, Strategic report).
Principle 3 - Take into account wider stakeholder and social responsibilities
and their implications for long-term success
The Board recognises the importance of its wider stakeholders - employees,
contractors, suppliers, customers, regulators and advisors - to its long-term
success. The Board has established expectations that these key resources and
relationships are valued and monitored. In particular, the Group's business
model of outsourcing some its key activities requires reliable dialogue with
contractors to ensure the successful pursuit of its long-term strategic
objectives. Furthermore, the Board engages regularly with its corporate
advisers to ensure proactive communication regarding the Group's activities.
In doing so, the Group is able to take any feedback into account and adjust
its actions accordingly to ensure it stays focused on long-term performance.
The Board recognises that the Group operates within a competitive and fast
changing industry and strives to remain alert to developments in a wider
industry/society context.
Principle 4 - Embed effective risk management, considering both opportunities
and threats, throughout the organisation
B90 operates within a complex business environment and an industry that is
fundamentally driven by regulatory processes. The Board has set out its
understanding of the principal risks and uncertainties in this report (see
page 12 for details and going concern statement on page 9) and regularly
reviews its strategies for minimising any adverse impact to the Group or its
investors.
The Directors acknowledge their responsibility for the Group's system of
internal control, which is designed to ensure adherence to the Group's
policies whilst safeguarding the assets of the Group, in addition to ensuring
the completeness and accuracy of the accounting records. Responsibility for
implementing a system of internal financial control is delegated to the CFO.
The essential elements of the Group's internal financial control procedures
involve:
● Strategic business planning
The Board regularly reviews and discusses the Group's performance and
strategic objectives.
● Performance review
The Directors monitor the Group's performance through the preparation and
consideration of monthly management accounts, daily through KPIs and regular
reviews of its expenditure and projections. In addition, detailed financial
projections for each financial year are prepared and are subject to formal and
regular review against actual trading by the Board.
Principle 5 - Maintain the Board as a well-functioning, balanced team led by
the Chairman
The Board comprises of five Directors of which two are Executive and three are
Non-Executive, reflecting a blend of different experience and backgrounds.
Considering the shareholding of Mark Rosman, the Board considers, at this
moment, that Martin Fleisje and Andrew McIver are completely independent as a
Director in terms of the QCA guidelines. Accordingly, the composition of the
Board does currently satisfy the QCA recommendation that there are at least
two independent Non-Executive Directors on the Board.
The Board meets throughout the year and all major decisions are taken by the
Board as a whole. The Group's day-to-day operations are managed by the
Executive Directors. All Directors have access to the Group information and
any Director needing independent professional advice in the furtherance of
his/her duties may obtain this advice at the expense of the Group.
The role of the Chairman is to provide leadership of the Board and ensure its
effectiveness on all aspects of its remit to maintain control of the Group. In
addition, the Chairman is responsible for the implementation and practice of
sound corporate governance. The Executive Chairman, being actively involved in
the day-to-day operations of the Company, is well-positioned to provide strong
leadership and strategic direction. This facilitates agility in responding to
market dynamics and executing the Company's long-term vision and objectives.
Our Non-Executive directors are expected to devote as much time as is
necessary for the proper performance of their duties. Executive directors are
full-time employees or services providers and expected to devote as much time
as is necessary for the proper performance of their duties.
During 2023 the Board held twelve (12) formal meetings either in person or by
call, all of which were attended by all Directors. The Board also passed eight
(8) unanimous written resolutions.
Principle 6 - Ensure that between them the directors have the necessary up
to-date experience, skills and capabilities
The Board considers its current composition to be appropriate and suitable
with the adequate and up-to-date experience, skills and capabilities to make
informed decisions. Each member of the Board brings a different set of skills,
expertise and experience, making the Board a diverse unit equipped with the
necessary set of skills required to create maximum value for the Group.
The Board is fully committed to ensuring its members have the right skills.
Members of the Board must be re-elected by the shareholders of the Company if
they have not been re-elected at the previous two annual general meetings in
accordance with the Company's Articles of Association, thereby providing
shareholders the ability to decide on the election of the Company's Board.
The biographical details of the Directors are:
Ronny Breivik (Executive Chairman)
Ronny (aged 50) has worked in online gaming since 1997 and launched the first
gaming portal in Norway. In the early 2000s, Ronny was involved in a
start-up, OddsAlive.com, which was subsequently sold to BetInternet in 2003.
From 2004 until 2006 Ronny worked with Sportingbet.com, while also taking on
the role of Product Manager for Bet24.com, which was later sold to the Modern
Times Group. While at Bet24.com, Ronny introduced live betting and online
poker to that company's product portfolio, creating and honing a profitable
business model for live betting and online poker. From 2006 until 2011, Ronny
was the CEO of M&B Poker Invest Ltd, which specialized in betting
affiliation. During this time, Ronny co-founded and was one of the pioneers
of the world's first 'rakeback' site, arguably disrupting the online poker
world.
Marcel Noordeloos (Chief Financial Officer):
Marcel (aged 55) was Group Finance Director at Playlogic International NV
between 2006 and 2009 before becoming Chief Financial Officer of Playlogic
Entertainment Inc (listed on Nasdaq in New York) in March 2009. Marcel became
Chief Financial Officer at B90 Holdings plc in January 2011. Marcel has held
several management positions with among others Nike (2002-2006) and PwC (1992
- 2001). Marcel holds an RA Degree (Registered Accountant) from the University
of Amsterdam.
Mark Rosman (Senior non-executive Director):
Mark (aged 57), Senior non-executive Director, has over 20 years of experience
advising on private equity investments and managing private equity portfolios.
Mark worked for Galladio Capital Management BV for eleven years and held the
role of Chief Operating Officer from 2006 until his departure in 2010. Since
leaving Galladio, Mark has serviced as Chief Executive Officer of The Nestegg
BV, a private equity management and advisory firm that advises high net worth
individuals on the structuring and management of investments. Mark is a law
graduate from VU University Amsterdam and has an MBA from the Rotterdam School
of Management.
Martin Fleisje (Non-executive Director):
Martin (aged 43), Non-Executive Director, is currently chief financial
officer of Induct AS, a Norwegian software company. Prior to joining Induct
AS, Martin spent the majority of his career in wealth management and sales
most recently with Kraft Finans AS and Pioner Kapital AS, both based in
Norway.
Andrew McIver (Non-executive Director):
Andrew (aged 60), Non-Executive Director, has long been involved with a host
of successful gaming businesses and, for the last three years, has been
Non-Executive Chairman of a leading Italian gambling company, Planet
Win/SKS365 Malta Ltd. From mid-2016 to early 2018, Andrew was Group Chief
Executive of Jackpotjoy plc, one of the world's largest online bingo companies
at the time, with an EBITDA of £100 million. From 2001-2006 he was CFO of
Sportingbet Plc, a pioneering sportsbetting company, before leaving as CEO
from 2006-2013. Andrew has also been Director of Finance for House of Fraser
plc and held senior roles at British Telecom plc, Hilton Group Finance plc
(now Ladbrokes Group Finance plc), and Signet Group plc (now Signet Group
Limited). He has also acted as a Non-Executive Director for both AIM-quoted
and private companies. He began his career as a Chartered Accountant with
Arthur Andersen LLP, following which he moved into corporate finance at
Kleinwort Benson.
Due to the size of the Group, the Group has not adopted a formal diversity
policy, other than looking at educational and professional backgrounds.
The Board also consults with external advisers, such as its nominated adviser
and the Company's lawyers, and with executives of the Company on various
matters as deemed necessary and appropriate by the Board.
Principle 7 - Evaluate Board performance based on clear and relevant
objectives, seeking continuous improvement
B90's Board is small and fully focussed on implementing the Group's strategy.
However, given the size and nature of the Group, the Board does not consider
it appropriate to have a formal performance evaluation procedure in place, as
described and recommended in Principle 7 of the QCA Code. The Board will
closely monitor the situation as it grows.
Principle 8 - Promote a corporate culture that is based on ethical values and
behaviours
We are committed to acting ethically and with integrity. We expect all
employees, officers, directors and other persons associated with us to conduct
their day-to-day business activities in a fair, honest and ethical manner.
For that purpose, we have adopted a Code of Business Conduct and Ethics
("Code") which applies to all our workforce personnel. Pursuant to the Code,
employees, directors and other relevant stakeholders are required to comply
with all laws, rules and regulations applicable to us. These include, without
limitation, laws covering anti-bribery, copyrights, trademarks and trade
secrets, data privacy, insider trading, illegal political contributions,
antitrust prohibitions, rules regarding the offering or receiving of
gratuities, environmental hazards, employment discrimination or harassment,
occupational health and safety, false or misleading financial information or
misuse of corporate assets. The Code also includes provisions for disclosing,
identifying and resolving conflicts of interest of the employees and Board
members.
The Code includes provisions requiring all employees to report any known or
suspected violation and ensures that all reports of violations of the Code
will be handled sensitively and with discretion. We also recognise the
benefits of a diverse workforce and are committed to providing a working
environment that is free from discrimination.
We have also adopted a share dealing code, regulating trading and
confidentiality of inside information by persons discharging managerial
responsibility and persons closely associated with them ("PDMRs").
We take all reasonable steps to ensure compliance by PDMRs and any relevant
employees with the terms of the dealing code.
The Board considers that the Company complies with the requirements set in
this principle.
Principle 9 - Maintain governance structures and processes that are fit for
purpose and support good decision-making by the Board
Corporate Governance Committees
The Board has established two committees, of which the composition is as
follows:
Audit committee
Andrew McIver (Chairman)
Martin Fleisje
Remuneration committee
Mark Rosman (Chairman)
Andrew McIver
The Audit Committee
The Audit Committee meets at least two times during the year to review the
published financial information, the effectiveness of external audit and
internal financial controls including the specific matters set out below.
The terms of reference of the Audit Committee are to assist all the Directors
in discharging their individual and collective legal responsibilities and
during the meetings to ensure that:
● The Group's financial and accounting systems provide accurate and
up-to-date information on its current financial position, including all
significant issues and going concern;
● The integrity of the Group's financial statements and any formal
announcements relating to the Group's financial performance and reviewing
significant financial reporting judgments contained therein are monitored;
● The Group's published financial statements represent a true and
fair reflection of this position; and taken as a whole are balanced and
understandable, providing the information necessary for shareholders to assess
the Group's performance, business model and strategy;
● The external audit is conducted in an independent, objective,
thorough, efficient and effective manner, through discussions with management
and the external auditor; and
● A recommendation is made to the Board for it to put to
shareholders at a general meeting, in relation to the reappointment,
appointment and removal of the external auditor and to approve the
remuneration and terms of engagement of the external auditor.
The Audit Committee does not consider there is a need for an internal audit
function given the size and nature of the Group.
Significant issues considered by the Audit Committee during the year have been
the Principal Risks and Uncertainties (which are set out in this annual
report) and their effect on the financial statements. The Audit Committee
tracked the Principal Risks and Uncertainties through the year and kept in
contact with the Group's Management, External Service Providers and Advisers
and received regular updates. The Audit Committee is satisfied that there has
been appropriate focus and challenge on the high-risk areas.
CLA Evelyn Partners Limited, our external auditors, have been in office since
2013.
The external auditors are invited to attend the Audit Committee meeting to
present their findings and this provides them with a direct line of
communication to the Non-Executive Directors.
The Remuneration Committee
The terms of reference of the Remuneration Committee are to:
● recommend to the Board a framework for rewarding senior
management, including Executive Directors, bearing in mind the need to attract
and retain individuals of the highest calibre and with the appropriate
experience to make a significant contribution to the Group; and
● ensure that the elements of the remuneration package are
competitive and help in underpinning the performance-driven culture of the
Group.
Principle 10 - Communicate how the company is governed and is performing by
maintaining a dialogue with shareholders and other relevant stakeholders
The Board is committed to maintaining good communication with its shareholders
and in promoting effective dialogue regarding the Group's strategic objectives
and performance. Institutional shareholders and analysts have the opportunity
to discuss issues and provide feedback via meetings with the Company. The
Annual General Meeting and any other General Meetings that are held throughout
the year are for shareholders to attend and question the Directors on the
Company's performance. Regular progress reports are also made via RNS
announcements and the point of contacts are Ronny Breivik, Executive Chairman
and Marcel Noordeloos, CFO.
Our Audit Committee Report is included on pages 20 to 21 of this Annual
Report. Our Remuneration Committee Report is included on page 22 of this
Annual Report.
This report was authorised for issue by the Board on 15 May 2024.
Ronny Breivik
Executive Chairman, B90 Holdings plc
15 May 2024
Audit Committee Report
General and Composition of the Audit Committee
The Audit Committee is a sub-committee of the Board. The Audit Committee
chairman reports formally to the Board on all matters within the Committee's
duties and responsibilities and on how the Audit Committee discharges its
responsibilities.
The Audit Committee consists of two members, Andrew McIver (Chairman) and
Martin Fleisje.
The biographies of the Audit Committee members are on pages 16-17 under
principle six, as well as on the Company's website at
www.b90holdings.com/corporate-info .
The Audit Committee meets at twice a year at appropriate times in the
reporting and audit cycle and otherwise as required. The Audit Committee also
meets regularly with the Company's external auditors.
Purpose and Responsibilities of Audit Committee
The purpose of the Audit Committee is to assist the Board to carry out the
following functions more efficiently and fully:
● Oversight of the integrity of the Group's formal reports,
statements and announcements relating to the Group's financial performance;
and
● Reviewing compliance with internal guidelines, policies and
procedures and other prescribed internal standards of behaviour.
To achieve such purposes, the Audit Committee has been assigned with the
following responsibilities:
● Reviewing the half-year and full-year financial statements with
management and with the external auditors as necessary prior to their approval
by the Board;
● Reviewing financial results announcements of the Group and any
other formal announcements relating to the Group's financial performance and
recommending them to the Board for approval;
● Reviewing recommendations from the CFO and the external auditors
on the key financial and accounting principles to be adopted by the Group in
the preparation of the financial statements;
● Reviewing the Group's systems for internal financial control;
● Considering and making recommendations to the Board, to put to
shareholders for approval at the AGM, the appointment, re-appointment and
removal of the Company's external auditors and oversee the relationship with
the external auditors;
● Reviewing and approving the external audit plan and regularly
monitoring the progress of implementation of the plan;
● Determining and monitoring the effectiveness and independence
of the external auditors.
Main Activities in 2023 and 2024
On 29 June 2023 the Audit Committee reviewed the financial statements for
year-end 31 December 2022.
On 27 September 2023 the Audit Committee reviewed the financial results of the
Company for the six months ended 30 June 2023. The audit committee had the
2023 audit planning meeting with our external auditors on 11 January 2024 and
a completion audit committee call was held on 13 May 2024. On 15 May 2024
the Audit Committee reviewed the financial statements for year-ended 31
December 2023.
External Auditors
The external auditors of the Company are CLA Evelyn Partners Limited ("EP").
The appointment of EP as auditors by the Audit Committee was based on their
performance during past years. The Audit Committee review of the external
auditors confirmed the appropriateness of their reappointment and included
assessment of their independence, qualification, expertise and resources, and
effectiveness of their audit process.
Both the Board and the external auditors have safeguards in place to avoid the
possibility that the auditors' objectivity and independence could be
compromised. The services provided by the external auditors include the
Audit-related services. In recognition of public concern over the effect of
consulting services on auditors' independence, the external auditors are not
invited to general consulting work which can affect their independence as
external auditors.
The total remuneration of the external auditors for 2023 and for 2022 was as
listed in the table below:
2023 2022
Audit services €150,000 €135,000
The Audit Committee remains mindful of the attitude investors have to the
auditors performing non-audit services. The Committee has clear policies
relating to the auditors undertaking non-audit work and monitors the
appointment of the auditors for any non-audit work, with a view to ensuring
that non-audit work does not compromise the Company's auditor's objectiveness
and independence.
Through the discussions with the auditors and review of the scoped work no
matters were identified over the independence of the external auditors.
Financial Reporting
The Group's trading performance is monitored on an ongoing basis. An annual
budget is prepared, and specific objectives and targets are set. The budget is
reviewed and approved by the Board. The key trading aspects of the business
are monitored daily and internal management and financial accounts are
prepared monthly. The results are compared to budget and prior year
performance.
The Audit Committee has taken and will continue to take further steps to
ensure the Group's control environment is working effectively and efficiently.
--------------------------------
Andrew McIver
Chairman of the Audit Committee
Remuneration Committee Report
General
The Remuneration Committee is responsible for determining and recommending to
the Board the framework for the remuneration of the Board chairman, executive
directors and other designated senior executives and, within the terms of the
agreed framework, determining the total individual remuneration packages of
such persons including, where appropriate, bonuses, incentive payments and
share options or other share awards.
The Remuneration Committee consists of two members, Mark Rosman (Chairman) and
Andrew McIver. The Remuneration Committee meets at least once a year and
otherwise as required.
Key elements in Remuneration
As an AIM-quoted company, the Company is not required to comply with the
remuneration reporting requirements applicable to fully listed companies in
the UK. However, set out below are certain disclosures relating to directors'
remuneration:
● The remuneration of executive directors and certain other senior
executives is set by comparison to market rates at levels aimed to attract,
retain and motivate the best staff, recognising that they are key to the
ongoing success of the business.
● The remuneration of non-executive directors is a matter for the
Chairman and the executive directors to determine.
● No Director is involved in any decision as to his or her own
remuneration.
● The remuneration of senior management includes equity-based
payments (stock options) vested over time to retain their employment.
Responsibilities of the Remuneration Committee
The responsibilities of the Remuneration Committee include the below and other
responsibilities as set forth in the Charter of the Committee:
● Setting the remuneration policy for all executive directors;
● Recommending and monitoring the level and structure of
remuneration for senior management personnel;
● Reviewing the design of all share incentive plans for approval
by the Board and shareholders.
Share option scheme
On 17 May 2016, the Company adopted a "long term incentive senior management
and Directors' stock option plan" ("the Plan"). Options granted under the
Plan will entitle the participant to acquire Ordinary Shares at a price
determined in accordance with the rules of the Plan.
The Directors' interests in the Company's share options for the year ended 31
December 2023 are shown on page 10. Share options granted as per 31 December
2023 are shown in Note 17 on page 47.
The Committee remains committed to a fair and responsible approach to
executive pay whilst ensuring it remains in line with best practice and
appropriately incentivises executive directors over the longer term to deliver
the Group's strategy. An overview of Directors remuneration is shown in Note 5
on page 39.
---------------------------------
Mark Rosman, Chairman of the Remuneration Committee
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF B90 HOLDINGS PLC
Opinion
We have audited the financial statements of B90 Holdings plc (the 'group') for
the year ended 31 December 2023 which comprise the Consolidated Statement of
Comprehensive Income, the Consolidated Statement of Financial Position, the
Consolidated Statement of Changes in Equity, the Consolidated Statement of
Cash Flows and the notes to the consolidated financial statements, including a
summary of material accounting policies. The financial reporting framework
that has been applied in their preparation is applicable law and International
Financial Reporting Standards (IFRSs) as adopted by the European Union.
In our opinion, the financial statements:
· give a true and fair view of the state of the group's affairs as at 31
December 2023 and of the group's loss for the year then ended; and
· have been properly prepared in accordance with IFRSs as adopted by the
European Union.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing
(UK) (ISAs (UK)) and applicable law. Our responsibilities under those
standards are further described in the Auditor's responsibilities for the
audit of the financial statements section of our report. We are independent
of the group in accordance with the ethical requirements that are relevant to
our audit of the financial statements in the UK, including the FRC's Ethical
Standard as applied to listed entities, and we have fulfilled our other
ethical responsibilities in accordance with these requirements. We believe
that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our opinion.
Our approach to the audit
Of the Group's 18 (2022: 16) reporting components, we subjected 6 (2022: 6) to
audits for group reporting purposes where the extent of our audit work was
based on our assessment of the risk of material misstatement and of the
materiality of the Group.
For the remaining 12 components, we performed analysis at a group level to
re-examine our assessment that there were no significant risks of material
misstatement within these.
The components within the scope of our work covered 100% of group revenue, 99%
of group loss before tax, and 100% of group assets.
All audit work relevant to this opinion has been performed by the Group audit
team in the UK.
Emphasis of matter related to impairment of other intangible assets
We draw attention to note 10 in the financial statements, which explains, for
Oddsen, Emwys and Spinbookie assets, the revenue growth included as part of
the annual impairment review is reliant on cumulative annual revenue growth of
38.3% in year 1 and 5.8% for years 2-5 for Oddsen, 35.3% in year 1 and 34.9%
for years 2-5 for Emwys, and 9.8% in year 1 and 21.4% for years 2-5 for
Spinbookie. The ultimate outcome of this matter is not certain, and the
financial statements do not reflect any impairment that might be required
against these assets should the revenue growth rates not be achieved.
Our opinion is not modified in respect of this matter.
Key audit matters
In addition to the matter described in the Material uncertainty related to
going concern and Emphasis of matter sections, we have determined the matters
described below to be the key audit matters being those that were of most
significance in the audit of the financial statements of the current period.
Key audit matters include the most significant assessed risks of material
misstatement, including those risks that had the greatest effect on our
overall audit strategy, the allocation of resources in the audit and the
direction of the efforts of the audit team.
In addressing these matters, we have performed the procedures below which were
designed to address the matters in the context of the financial statements as
a whole, and in forming our opinion thereon. Consequently, we do not provide
a separate opinion on these individual matters.
Key audit matter Description of risk How the matter was addressed in the audit
Revenue Recognition Revenue is a key performance indicator of the Group. Revenue based targets We reviewed the Group's accounting policy for revenue recognition and assessed
may place pressure on management to distort revenue recognition. This may whether it is in line with industry and international financial reporting
result in overstatement to assist in meeting current targets or expectations. standards ("IFRS").
We evaluated the design and implementation of relevant internal controls that
the Group uses to ensure the completeness, accuracy and timing of revenue
Relevant disclosures in the Annual report & Accounts 2023: recognised.
Note 2: Material accounting policies and Note 4: Segmental reporting We performed substantive testing including:
· Reviewed material revenue contracts with customers;
· Tested the recognition compliance with IFRS 9 & 15;
· Performed detailed testing on a sample of revenue transactions,
including agreement to third party reports;
· For affiliate marketing revenues (Including PPC revenue) - where
cash has been received, we agreed to bank statements and remittance;
· For sportsbook and casino revenues - We have corroborated the
movements to the corresponding player liability accounts; and
· We reviewed the disclosures made by the directors in the financial
statements.
Carrying value of Goodwill with indefinite useful lives and Other intangible The Group holds Goodwill with an indefinite useful life relating to the We reviewed management's accounting policy for impairment and assessed whether
assets acquisition of Quasar Holdings Ltd (Bet90.com) and It's a winner Limited it is in line with IAS 36.
(Oddsen.nu).
We evaluated the design and implementation of relevant internal controls
Other intangible assets should be held at the lower of amortised cost or their surrounding the review process of impairment models.
recoverable amount. Where there is an indicator of impairment such as
performance being worse than expected, an impairment review is undertaken. We performed substantive testing including:
Significant judgment is needed in order to assess the appropriateness of the · Challenged Management's assessment of the relevant CGUs with
recoverable amount of these assets/CGUs to which an indicator of impairment is reference to the guidance set out in IAS 36;
noted or to which the Goodwill has been allocated, in particular with
reference to forecasted cash flows, growth rates, discount rates and · Reviewed the assessment over indicators of impairment for other
sensitivity assumptions. intangibles with definite useful lives;
· Considered the appropriateness and mathematical accuracy of the
model used to determine the recoverable amount of the It's a winner Limited
Relevant disclosures in the Annual report & Accounts 2023: (Oddsen.nu), Spinbookie and Emwys CGUs;
Note 3: Judgements and estimates; Note 9: Goodwill and Note 10: Other · Considered historical trading performance by comparing both revenue
intangible assets and operating profit of the Group's CGUs with projected revenues and operating
profits;
· We assessed and challenged the appropriateness of the assumptions
concerning:
o Revenue growth rates to projected player revenue models based on player
acquisition and expected net gaming revenues per player;
o Costs basis to historic cost data including relevant affiliate and
platform agreements;
o inputs to the discount rate against latest market expectations; and
· We challenged and evaluated management's sensitivity analysis of
the key variables included within the value in use calculations.
In performing and to support our procedures, we used our internal valuation
specialists and third-party evidence.
Materiality
The materiality for the group financial statements as a whole ("group FS
materiality") was set at €299,000 (2022: €148,100). This has been
determined with reference to the benchmark of the group's net assets, which we
consider to be one of the principal considerations for members of the Group in
assessing the performance of the group. This is due to the Group entering into
several acquisitions and reassessing its business model in recent years. The
new acquisitions are being integrated within the Group. We have also
sensitised the materiality threshold against one based on Gross Expenditure
and consider the threshold noted to be reasonable. Group FS materiality
represents 3.72% (2022: 5%) of the group's net assets as presented on the face
of the Consolidated Statement of Financial Position. We have determined net
assets to be appropriate in the current year given Group is still investing in
developing its revenues and profitability. The group FS materiality was set at
a lower percentage compared to prior year after reflecting on other possible
parameters that might be used as well as the primary parameter described in
the forgoing. The materiality value determined has increased in line with
additional fundraising used to undertake further asset investments compared to
the prior period
Performance materiality for the group financial statements was set at
€209,300 (2022: €103,670). being 70% (2022: 70%) of group FS
materiality, for purposes of assessing the risks of material misstatement and
determining the nature, timing and extent of further audit procedures. We
have set it at this amount to reduce to an appropriately low level the
probability that the aggregate of uncorrected and undetected misstatements
exceeds group FS materiality. We judged this level to be appropriate based
on our understanding of the group and its financial statements, as updated by
our risk assessment procedures and our expectation regarding current period
misstatements including considering experience from previous audits. It was
set at 70% to reflect our judgement on the risk of misstatements in the
current period in the context of areas of judgement and estimation in the
financial statements.
Material uncertainty related to going concern
We draw attention to note 1 in the financial statements, which indicates that:
The Group reported a net loss for the year of €5.5m, had net current
liabilities of €1.0m as at 31 December 2023, and negative cash flow from
operations of €4.0 million for the year ended 31 December 2023. Whilst the
Directors believe that its revised strategy will lead to a significant
increase in revenues and in profitability, there is no certainty that this
will be achieved and make the Group cash flow positive during 2024.
Should trading not be in line with management's expectations going forward,
the Group's ability to meet its liabilities may be impacted, in which case the
Group may need to raise further funding. In such circumstance that this is
needed, and whilst the directors are confident of being able to raise such
funding if required, there is no certainty that such funding will be available
and/or the terms of such funding. These conditions are necessarily considered
to represent a material uncertainty which may cast significant doubt over the
Group's ability to continue as a going concern.
Notwithstanding the above, in auditing the financial statements we have
concluded that the directors' use of the going concern basis of accounting in
the preparation of the financial statements is appropriate. Our evaluation of
the directors' assessment of the group's ability to continue to adopt the
going concern basis of accounting included:
· We challenged and reviewed management's sensitivity analysis in
their forecasts, made up to December 2025, looking at cash generation and key
assumptions such as revenue generation from major sporting events. Where
appropriate we used third party data to review and, where necessary, challenge
their inputs;
· We reviewed and challenged the disclosures in the Annual Report
and Accounts surrounding Going Concern;
· We compared the forecast results to those actually achieved in
the 2024 financial period so far;
· We reviewed bank statements to monitor the cash position of the
group post year end, and obtained an understanding of significant expected
cash outflows (such as marketing expenditure) in the forthcoming 12-month
period; and
· We considered the group's funding position and requirements.
Our responsibilities and the responsibilities of the directors with respect to
going concern are described in the relevant sections of this report.
Other information
The other information comprises the information included in the Annual Report
and Accounts, other than the financial statements and our auditor's report
thereon. The directors are responsible for the other information contained
within the Annual Report and Accounts. Our opinion on the financial
statements does not cover the other information and, except to the extent
otherwise explicitly stated in our report, we do not express any form of
assurance conclusion thereon. Our responsibility is to read the other
information and, in doing so, consider whether the other information is
materially inconsistent with the financial statements or our knowledge
obtained in the course of the audit or otherwise appears to be materially
misstated. If we identify such material inconsistencies or apparent material
misstatements, we are required to determine whether this gives rise to a
material misstatement in the financial statements themselves. If, based on
the work we have performed, we conclude that there is a material misstatement
of this other information, we are required to report that fact.
We have nothing to report in this regard.
Responsibilities of directors
As explained more fully in the directors' responsibilities statement set out
on page 10, the directors are responsible for the preparation of the financial
statements and for being satisfied that they give a true and fair view, and
for such internal control as the directors determine is necessary to enable
the preparation of financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for
assessing the group's ability to continue as a going concern, disclosing, as
applicable, matters related to going concern and using the going concern basis
of accounting unless the directors either intend to liquidate the group or to
cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial
statements as a whole are free from material misstatement, whether due to
fraud or error, and to issue an auditor's report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that
an audit conducted in accordance with ISAs (UK) will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and
are considered material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users taken on
the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and
regulations. We design procedures in line with our responsibilities,
outlined above, to detect material misstatements in respect of irregularities,
including fraud. The extent to which our procedures are capable of detecting
irregularities, including fraud, is detailed below:
We obtained a general understanding of the Group's legal and regulatory
framework through inquiry of management concerning:
- their understanding of relevant laws and regulations;
- the entity's policies and procedures regarding compliance; and
- how they identify, evaluate and account for litigation claims.
We also drew on our existing understanding of the Group's industry and
regulation. We understand that the Group complies with the framework through:
- Maintaining an active licence through the Curacao Gaming Authority
("CGA") by maintaining records subject to random audits from the CGA.
In the context of the audit, we considered those laws and regulations:
- which determine the form and content of the financial statements;
- which are central to the Group's ability to conduct its business;
and
- where failure to comply could result in material penalties.
We identified the following laws and regulations as being of significance in
the context of the Group:
- Curacao gambling laws; and
- IFRS in respect of the preparation and presentation of the financial
statements.
We evaluated potential non-compliance with these laws and regulations by:
- Reviewing current Curacao gaming service licence; and
- Reviewing board minutes for evidence of non-compliance.
The senior statutory auditor led a discussion with senior members of the
engagement team regarding the susceptibility of the group's financial
statements to material misstatement, including how fraud might occur. The
areas identified in this discussion were:
- Manipulation of the financial statements, especially early
recognition of revenue, via fraudulent journal entries and possible management
bias in relation to the key assumptions which drive the recoverable values of
the Oddsen.nu, Quasar Holdings ltd (Bet90), Spinbookie.com and Emwys CGUs.
The procedures we carried out to gain evidence in the above areas included:
- Substantive work on revenue recognition and the carrying value of
Goodwill with indefinite useful lives and Other intangible assets (see above
KAMs); and
- Testing journal entries, focusing particularly on postings to
unexpected or unusual accounts including unexpected entries.
A further description of our responsibilities is available on the Financial
Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities
(http://www.frc.org.uk/auditorsresponsibilities) . This description forms
part of our auditor's report.
Use of our report
This report is made solely to the Group's members, as a body, in accordance
with our engagement letter dated 15 June 2021. Our audit work has been
undertaken so that we might state to the Group's members those matters we are
required to state to them in an auditor's report and for no other purpose.
To the fullest extent permitted by law, we do not accept or assume
responsibility to anyone other than the Group and the Group's members as a
body, for our audit work, for this report, or for the opinions we have formed.
CLA Evelyn Partners Limited
Statutory Auditor
Chartered Accountants
45 Gresham Street
London
EC2V 7BG
15 May 2024
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Year ended Year ended
31 December 2023 31 December 2022
Note € €
Revenue 4 3,025,352 2,138,212
Salary expense (2,359,386) (2,112,893)
Marketing and selling expense (1,626,207) (763,821)
Other administrative expense (2,705,023) (1,950,016)
Depreciation, amortisation and impairment expense (922,085) (1,557,525)
Total administrative expenses (7,612,701) (6,384,255)
Operating loss (4,587,349) (4,246,043)
Finance expense (387,030) (35,833)
Loss on fair value of equity conversion feature of Convertible Loan Note (500,686) -
Loss before tax 6 (5,475,065) (4,281,876)
Taxation 7 4,462 13,680
Loss for the period (5,470,603) (4,268,196)
Loss per share attributable to equity holders of the Company
- Basic (in €) 8 (0.0168) (0.0164)
- Diluted (in €) 8 (0.0168) (0.0164)
The Notes form part of these financial statements
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Year ended Year ended
31 December 31 December
2023 2022
Note
€ €
Non-current assets
Goodwill 9 1,913,600 2,229,211
Other intangible assets 10 7,324,389 4,330,864
Total non-current assets 9,237,989 6,560,075
Current assets
Other receivables & prepayments 11 487,986 193,627
Cash and cash equivalents 12 829,116 359,053
Total current assets 1,317,102 552,680
Total assets 10,555,091 7,112,755
Equity and liabilities
Share capital 13 - -
Additional paid-in capital 14 41,110,393 30,966,848
Reverse asset acquisition reserve 15 (6,046,908) (6,046,908)
Retained earnings 16 (27,026,092) (21,957,873)
Total shareholders' equity 8,037,393 2,962,067
Non-current liabilities
Convertible loan note 18 655,646
-
Deferred tax liability 22 233,928 259,920
Total non-current liabilities 233,928 915,566
Current liabilities
Trade and other payables 19 2,283,770 3,210,344
Corporate income tax payable - 24,778
Total current liabilities 2,283,770 3,235,122
Total equity and liabilities 10,555,091 7,112,755
Approved by the board on 15 May 2024 and signed on its behalf by:
Ronny Breivik
Executive Chairman
The Notes form part of these financial statements
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Additional Other reserves -
Share paid in Reverse asset Retained Non-controlling Total
capital capital acquisition reserve earnings Total interest Equity
€ € € € € € €
Balance as at 1 January 2022 - 27,734,003 (5,086,668) (17,987,052) 4,660,283 (24,388) 4,635,895
Loss for the financial period - - - (4,268,196) (4,268,196) - (4,268,196)
Share based payments - - - 349,363 349,363 - 349,363
Share based acquisition - 2,037,840 (960,240) (51,988) 1,025,612 24,388 1,050,000
Issue of share capital - 1,219,800 - - 1,219,800 - 1,219,800
Cost of raise of capital - (24,795) - - (24,795) - (24,795)
Balance as at 31 December 2022 - 30,966,848 (6,046,908) (21,957,873) 2,962,067 - 2,962,067
Loss for the financial period - - - (5,470,603) (5,470,603) - (5,470,603)
Issue of share capital - 2,304,872 - - 2,304,872 - 2,304,872
Conversion of Convertible Loan Note - 6,058,892 - - 6,058,892 - 6,058,892
Share based asset acquisition - 1,600,000 - - 1,600,000 - 1,600,000
Swap of other liabilities for share capital - 536,141 - - 536,141 - 536,141
Share based payments - - - 402,384 402,384 - 402,384
Cost of raise of capital - (356,360) - - (356,360) - (356,360)
Balance as at 31 December 2023 - 41,110,393 (6,046,908) (27,026,092) 8,037,393 - 8,037,393
The Notes on pages 33 to 53 form part of these financial statements
CONSOLIDATED STATEMENT OF CASH FLOWS
31 December 31 December
2023 2022
€ €
Cash flows from operating activities
Operating (loss)/profit (4,587,349) (4,246,043)
Adjustments for:
Share based payments 402,384 349,364
Impairment of goodwill 315,611 1,095,320
Amortisation of intangibles 606,475 462,205
Bad debt expense (93,685) 23,450
Cash flow used in operations before working capital changes (3,356,564) (2,315,704)
(Increase) in trade and other receivables (200,672) (57,077)
(Decrease)/increase in trade and other payables (475,817) 61,062
Cash flow used in operations (4,033,053) (2,311,719)
Tax (paid)/received - -
Cash flow used in operating activities (4,033,053) (2,311,719)
Cash flow from investing activities
Acquisition of intangible assets (1,750,000) -
Net cash outflow used in investing activities (1,750,000) -
Cash flow from financing activities
Proceeds of issue of new shares 2,000,000 1,195,005
Receipts from Convertible Loan Notes 4,253,116 648,465
Net cash inflow generated from financing activities 6,253,116 1,843,470
Net increase/(decrease) in cash and cash equivalents 470,063 (468,249)
Cash and cash equivalents at start of period 359,053 827,302
Cash and cash equivalents at end of period 829,116 359,053
The Notes form part of these financial statements
Notes to the Consolidated Financial Statements
For the year ended 31 December 2023
Note 1: General Information
Company descriptions and activities
B90 Holdings plc (the "Company") and its subsidiaries (together the "Group")
was founded in 2012 in the Isle of Man (Company number 9029V). In July 2013,
the Company listed on the AIM market of the London Stock Exchange and
completed a reverse merger in June 2016.
The Group is focused on the operation an online Sportsbook and Casino product
as well as on marketing activities for other online gaming companies, via
websites and Google Pay-Per-Click ("PPC") activities.
Basis of preparation
The Consolidated Financial Statements have been prepared in accordance with
International financial reporting standards (''IFRS") as adopted by the
European Union. The Consolidated Financial Statements have been prepared under
the historical cost convention and on a going concern basis.
Basis of consolidation
The Consolidated Financial Statements incorporate the results of B90 Holdings
plc (the "Company") and entities controlled by the Company (its subsidiaries)
(collectively the "Group").
Going concern
Although the Group has increased revenues by c. 41% to €3.0 million, the
Group still operated at a loss in 2023. While the directors believe the
acquisition completed in 2023 (Emwys AB) will drive increased revenues in the
foreseeable future, the reported net loss for the year ended 31 December 2023
amounts to €5.5 million.
As per 31 December 2023, the Group shows total current liabilities of €2.3
million and a negative working capital position of €1.0 million. Whilst the
Directors believe that its revised strategy will show a significant increase
in revenues and in profitability, there is no guarantee that this will lead
the Group to become cash flow positive during 2024 and thus ensure sufficient
cash is available to meet its liabilities as they fall due in the foreseeable
future being the next 12 months from the date of signing these financial
statements.
Should trading not be in line with management's expectations going forward,
the Group's ability to meet its liabilities may be impacted, in which case the
Group may need to raise further funding. In such circumstance that this is
needed and whilst the directors are confident of being able to raise such
funding if required, there is no certainty that such funding will be available
and/or the terms of such funding. These conditions are necessarily considered
to represent a material uncertainty which may cast significant doubt over the
Group's ability to continue as a going concern.
Whilst acknowledging this uncertainty, the Directors remain confident that the
recent changes will allow the Group to expand its operations and generate a
positive operational cash flow within a reasonable time or, if needed, be able
to raise additional funding when required, therefore the Directors consider it
appropriate to prepare the financial statements on a going concern basis.
The financial statements do not include the adjustments that would result if
the Group was unable to continue as a going concern.
Note 2: Material accounting policies
The principal accounting policies applied in the preparation of these
Consolidated Financial Statements are set out below. The policies have been
consistently applied to all years presented, unless otherwise stated.
Revenue
Revenue from contracts with customers is recognised when the control over the
services is transferred to the customer. The transaction price is the amount
of the consideration that is expected to be received based on the contract
terms.
Sportsbook and casino revenue
Revenue is recognised provided that it is probable that economic benefits will
flow to the Group and the revenue can be reliably measured. Revenue is
recognised in the accounting periods in which the transactions occurred and
after adding the fees and charges applied to customer accounts, and is
measured at the fair value of the consideration received or receivable.
Revenue from these activities comprises:
Sportsbook
Sport online gaming revenue comprises bets placed less pay-outs to customers,
adjusted for the fair value of open betting positions, adjusted for the fair
value of certain promotional bonuses granted to customers.
Casino games
Casino, Bingo and other online gaming revenue is represented by the difference
between the amounts of bets placed by customers less amounts won, adjusted for
the fair value of certain promotional bonuses granted to customers.
The Company acts as the principal in sportsbook and casino operations.
Marketing commission revenue, including PPC revenue
In its operations which generate marketing commissions, the Group acts as the
agent. Revenue from marketing contracts with customers is recognised when
players are losing their funds on the operators' platforms on which the
Company is basing the amounts to be invoiced. In some cases, customers agree
to pay a fixed fee per acquired player. All fees and commissions are invoiced
on a monthly basis. The transaction price is the commission amount of the
consideration that is expected to be received based on the contract terms. The
performance obligation of a revenue contract is satisfied at the point a
player's losses are incurred. Operators typically pay a month in arrears. This
gives rise to contract assets on a short term basis.
Foreign currencies
The Group's functional and presentation currency is EURO. Transactions in
foreign currency and the recognition of assets and liabilities denominated in
foreign currencies are recognised and measured in accordance with IAS 21.
Taxation
Current tax
Current tax is recognised and measured in accordance with IAS 12.
Deferred tax
Deferred tax is recognised and measured in accordance with IAS 12.
Deferred tax liabilities are provided in full.
Deferred tax liabilities are recognised for taxable temporary differences
arising on investments in subsidiaries, except where the Group is able to
control the reversal of the temporary difference and it is probable that the
temporary difference will not reverse in the foreseeable future.
Intangible fixed assets
Acquired intangible assets
Intangible assets acquired separately consist of domain names and customer
lists and are capitalised at cost. Those acquired as part of a business
combination are recognised separately from goodwill if the fair value can be
measured reliably. These intangible assets are amortised over the useful
life of the assets, which is mentioned at the table below.
The valuation methodology used for each type of identifiable asset category is
detailed below:
Asset category Valuation methodology Useful life
Customer relationships Excess earnings 4 years
Brand and domain names Relief from royalty 20 years
Licenses Cost approach 4 years
Spinbookie assets Cost approach 10 years
Emwys assets Cost approach 10 years
Goodwill
Business combinations are accounted for in accordance with IFRS 3 using the
acquisition method as at the acquisition date, which is the date on which
control is transferred to the Group.
Goodwill is not amortised as the Group assumes an indefinite useful life.
Business combinations
For business combinations, the Group estimates the fair value of the
consideration transferred, which can include assumptions about the future
business performance of the business acquired and an appropriate discount rate
to determine the fair value of any contingent consideration. Judgement is also
applied in determining whether any future payments should be classified as
contingent consideration or as remuneration for future services.
The Group then estimates the fair value of assets acquired and liabilities
assumed in the business combination, including any separately identifiable
intangible assets. These estimates also require inputs and assumptions
including future earnings, customer attrition rates and discount rates. The
Group engages external experts to support the valuation process, where
appropriate. IFRS 3 'Business Combinations' allows the Group to recognise
provisional fair values if the initial accounting for the business combination
is incomplete. Judgement is applied as to whether changes should be applied at
the acquisition date or as post-acquisition changes.
The fair value of contingent consideration recognised in business combinations
is reassessed at each reporting date, using updated inputs and assumptions
based on the latest financial forecasts for the relevant business. Fair value
movements and the unwinding of the discounting is recognised within operating
expense.
Impairment of non-financial assets
Impairment of non-financial assets are accounted for in accordance with IAS
36.
Equity
Equity comprises the following:
• "Share capital" represents amounts subscribed for shares at
nominal value. Nominal value per share is nil.
• "Additional paid in capital" represents amounts subscribed for
share capital in excess of nominal value.
• The "Reverse asset acquisition reserve" represents the
difference in carrying value between the Additional paid in capital of B90
Holdings plc and the Share capital of Sheltyco on the acquisition date (June
2016).
• "Retained earnings" represents the accumulated profits and
losses attributable to equity shareholders. This also includes issued and
vested warrants and options.
Financial instruments
Trade and other receivables
Trade receivables are held in order to collect the contractual cash flows and
are initially measured at the transaction price as defined in IFRS 15. The
Group has applied IFRS 9's simplified approach and has calculated the ECLs
based on lifetime of expected credit losses. The contracts of the Group do not
contain significant financing components. Impairment losses are recognised
based on lifetime expected credit losses in profit or loss.
Other receivables are held in order to collect the contractual cash flows and
accordingly are measured at initial recognition at fair value, which
ordinarily equates to cost and are subsequently measured at cost less
impairment due to their short term nature. A provision for impairment is
established based on 12-month expected credit losses unless there has been a
significant increase in credit risk when lifetime expected credit losses are
recognised. The amount of any provision is recognised in profit or loss.
Cash and cash equivalents, and finance income
Cash and cash equivalents includes cash in hand, deposits held at call with
banks, other short-term highly liquid investments with original maturities of
three months (These include Player wallets).
Trade payables
Trade payables, including customer balances, are recognised initially at fair
value and subsequently measured at amortised cost using the effective interest
method.
Financial liabilities
Financial liabilities are classified as financial liabilities measured at
amortised cost. The Group determines the classification of its financial
liabilities at initial recognition. The measurement of financial liabilities
is initially recognised at fair value and subsequently measured at amortised
cost using the effective interest method. Amortised cost is calculated by
taking into account any issue costs and any discount or premium on
settlement. Gains and losses arising on the repurchase, settlement or
cancellation of liabilities are recognised respectively in finance expense.
Convertible Loan Note
The proceeds received on issue of the Group's Convertible loan notes ("CLN")
were recorded as a long-term liability. The instrument was determined to be a
hybrid instrument with the "Host" loan component being measured on an
amortised cost basis and the "Equity conversion" component being measured on a
fair value through profit or loss basis. The interest expense related to the
Host is recognised in the Finance expense within the Consolidated Statement of
Comprehensive Income until the conversion date, using the effective interest
rate. Additionally the fair value gain/loss of the embedded derivative has
been revalued up until the date of conversion with the corresponding fair
value adjustment being recorded within the Loss on fair value of equity
conversion feature of Convertible Loan Note within the Consolidated Statement
of Comprehensive Income.
Changes in accounting policies and disclosures
The following new and amended Standards and Interpretations effective for the
financial year beginning 1 January 2023 have been adopted. The adoption of
these standards has not had any material impact on the disclosures or on the
amounts reported in these financial statements.
· IAS 12 Income taxes: Deferred tax related to assets and liabilities
arising from a single transaction
· IAS 12 Income taxes: temporary recognition exception to accounting
for deferred taxes arising from the implementation of the international tax
reform (Pillar Two Model Rules)
· IAS 8 Accounting policies, Changes in Accounting Estimates and
Errors: Definition of accounting estimates
· IAS 1 Presentation of Financial Statements: Disclosure initiative -
accounting policies
Note 3: Judgements and estimates
The preparation of the Consolidated Financial Statements requires the
Directors to make judgements, estimates and assumptions that affect the
application of accounting policies and the reported amounts of assets and
liabilities, income and expense. Actual results may differ from these
estimates.
Key areas of judgement
Acquisition of Emwys AB
The Group acquired 100% of the Emwys AB share capital during the year. The
only item held in the entity were the the licenses relating to the active
affiliate Google PPC accounts. The Group therefore consider the acquisition to
have met the "concentration test" as set out within IFRS 3 and therefore
have assessed the acquisition to not be a business combination but rather has
been assessed to be the purchase of an intangible asset. As such the full
value of the acquisition has been included within Intangible assets as "Emwys
assets".
Key areas of estimation uncertainty
Impairment of Goodwill and other intangible fixed assets
Determining whether goodwill and other intangible fixed assets with a definite
or indefinite useful life are impaired requires an estimation of the
value-in-use of the cash-generating units. Goodwill was recorded following the
acquisition of the operations of Oddsen.nu in September 2021. The total
balance per 31 December 2023 amounts to €1.9 million. The directors have
used various estimates, revenue forecasts and expected future cash flows. The
recently completed and announced fundraises allow the Group to invest in
marketing and the Directors believe this will grow its overall operations to
support the carrying value of goodwill. If some of the expectations are not
met, impairment of the goodwill balance may be necessary in the future.
Further details around the estimates and assumptions used are disclosed in
notes 9 and 10.
Other areas of estimation
Convertible Loan Note
The Company issued unsecured convertible bonds of 10% in November 2022.
Interest would be accrued and convert with the principal amount. The bonds
were repayable three years from their issue date and could be converted at a
10% discount to the volume weighted average price for the five trading days
prior to the conversion notice. The Loan Notes converted at the request of the
Company on 14 September 2023, under these terms.
The convertible bonds were accounted as a financial liability as required
under IFRS 9. The convertible bonds included conversion at a 10% discount to
the market price, and paid a 10% interest. The directors believe these terms
are in line with market conditions.
Share-Based Payments
Certain employees (including Directors and senior Executives) of the Company
receive remuneration in the form of share-based payment transactions.
The fair value is determined using the Black-Scholes valuation model. The
Directors believe this is appropriate considering the effects of the vesting
conditions, expected exercise period and the dividend policy of the Company.
Due to limited trading history, the expected volatility has been based on the
5-year historical volatility of a mix of share prices from other companies in
the same industry, as well as the overall market volatility.
Note 4: Segment reporting
IFRS 8 requires operating segments to be identified on the basis of internal
reports about components of the Group that are regularly reviewed by the chief
operating decision maker to allocate resources to the segments and to assess
their performance. In accordance with IFRS 8, the chief operating decision
maker has been identified as the Board. The Board reviews the Group's
internal reporting in order to assess performance and allocate resources.
The Board considers that the business comprises of two activities:
1. Operating sportsbook and casino brands
2. Online marketing and promotion of online sportsbook and casino
websites, using affiliate agreements
Revenue originates from:
2023 2022
€ €
Online sportsbook and casino operations 1,176,960 1,391,208
Affiliate marketing commissions 1,848,392 747,004
Total 3,025,352 2,138,212
The Board evaluates the operations based on the revenues metric. Revenues
consist of invoiced commissions for the marketing and player acquisition
services provided, as well as revenues generated from own operations, based in
Malta and Curaçao. The Group operates an integrated business model and,
therefore, does not allocate general operating expenses, assets and
liabilities to any of the originating segments.
Note 5: Key management remuneration
Director and key management remuneration for each period was as follows:
Cash based Share based payments Total Total
salary Remuneration 2023 Remuneration 2022
€ € € €
Ronny Breivik 158,700 74,997 233,697 171,486
Marcel Noordeloos 173,000 81,292 254,292 240,979
Mark Rosman 50,400 74,997 125,397 117,551
Martin Fleisje 18,000 9,974 27,974 -
Andrew McIver 20,000 2,523 22,523 -
Karim Peer - - - 323,288
Nigel Eastwood - - - 19,443
Total 420,100 243,783 663,883 872,747
Note 6: Profit for the year
Profit before taxation is stated after charging/(crediting):
Year ended Year ended
31 December 2023 31 December 2022
€ €
Amortisation of intangibles 606,475 462,205
Impairment of goodwill 315,611 1,095,320
Bad debt expense 93,685 23,450
Short term lease expense 22,842 28,018
Share based payment charge 402,384 394,364
Foreign exchange losses 550,505 13,778
Note 7: Taxation
Year ended Year ended
31 December 2023 31 December 2022
€ €
Loss before tax (5,475,065) (4,281,876)
Profit before tax multiplied by the standard rate of corporation tax in Isle - -
of Man of 0%
Adjustments to tax charge in respect of previous periods (21,530) -
Release of deferred tax liability relating to acquisition 25,992 13,680
Tax credit 4,462 13,680
Note 8: Earnings per share (basic and diluted)
Year ended Year ended
31 December 2023 31 December 2022
€ €
Earnings
Earnings for the purposes of basic and diluted earnings per share, being net
profit after tax attributable to equity shareholders
(5,470,603) (4,268,196)
Number of shares
Weighted average number of ordinary shares for the purposes of: 326,123,139 260,483,323
Basic earnings per share
Diluted earnings per share 326,123,139 260,483,323
Basic loss per share (in €) (0.0168) (0.0164)
Diluted loss per share (in €) (0.0168) (0.0164)
The Group has granted share options in respect of equity shares to be issued,
the details of which are disclosed in Note 17. Share options and warrants
outstanding are anti-dilutive due to the losses incurred in each period.
Note 9: Goodwill
Goodwill
€
Cost
At 1 January 2022 3,324,531
Additions -
Impairments (1,095,320)
At 31 December 2022 2,229,211
Additions -
Impairments (315,611)
At 31 December 2023 1,913,600
Net Book Value
At 1 January 2022 3,324,531
At 31 December 2022 2,229,211
At 31 December 2023 1,913,600
Goodwill
Goodwill arose following:
- the acquisition of 51% in Quasar Holdings Ltd in 2017
- the acquisition of the operations of Oddsen.nu in September 2021
The addition of goodwill in 2021 is related to the Oddsen.nu acquisition.
The impairment of goodwill in 2022 and in 2023 is related to the acquisition
of Quasar Holdings. The book value of the goodwill related to Quasar Holdings
ltd, amounted to nil at the end of 2023.
Key assumptions and inputs used
The key assumptions and inputs used for the assessment of the value of the
goodwill are disclosed in Note 10, as well as assumptions used for the
impairment review.
Note 10: Other intangible assets
Customer database Brand and domain names Emwys Spinbookie assets Total
Assets
€ € € € €
Cost
At 1 January 2022 361,600 3,892,500 - 1,997,299 6,251,399
Additions - - - - -
Disposals - - - - -
At 31 December 2022 361,600 3,892,500 - 1,997,299 6,251,399
Additions - - 3,600,000 - 3,600,000
Disposals - - - - -
At 31 December 2023 361,600 3,892,500 3,600,000 1,997,299 9,851,399
Amortisation
At 1 January 2022 (45,663) (1,412,667) - - (1,458,330)
Charge for the period (84,250) (178,225) - (199,730) (462,205)
Disposals - - - - -
At 31 December 2022 (129,913) (1,590,892) - (199,730) (1,920,535)
Charge for the period (84,250) (172,495) (150,000) (199,730) (606,475)
Disposals - - - - -
At 31 December 2023 (214,163) (1,763,387) (150,000) (399,460) (2,527,010)
Net Book Value
At 1 January 2022 315,937 2,479,832 - 1,997,299 4,793,068
At 31 December 2022 231,687 2,301,608 - 1,797,569 4,330,864
At 31 December 2023 147,437 2,129,113 3,450,000 1,597,839 7,324,389
Customer database
The Customer database relates to the acquisition of the Oddsen.nu operations
in September 2021. The estimated remaining life of the customer database is
1.75 years.
Brand and domain names
The brand and domain names relate to the following acquisitions:
1. Quasar Holdings Ltd (owning Bet90.com) in 2017 (51%);
2. T4U Marketing ltd in 2017 (51%); and
3. Oddsen.nu in 2021 (100%).
Brand and domain names are considered to be business operations.
The carrying value of the brand and domain names for Bet90 (Quasar Holdings
ltd acquisition) as per 31 December 2023 amounts to € nil (2022: €52,546).
Oddsen.nu is considered to be a single cash-generating unit ("CGU"). The
carrying value of the brand and domain names for Oddsen.nu as per 31 December
2023 amounts to €2,129,113 (2022: €2,249,063) and has a remaining
estimated lifetime of 17.75 years.
Spinbookie assets
In December 2021, the Group acquired the business of Spinbookie.com, which is
presented under Spinbookie assets. This includes a fully operational
sportsbook and casino operation, operating using a Curacao gaming license.
Spinbookie operates on Famagousta NV, a gaming software developer platform and
has various payment service providers and other operating tools implemented.
The assets will be amortised over 10 years and at 31 December 2023 therefore
has 8 years remaining.
Emwys assets
In July 2023, the Group acquired Emwys AB. The assets acquired, being the
existing and active affiliate accounts used via Google PPC, are presented
under "Emwys assets". This includes the license agreement for the Google PPC
campaigns, a fully operational marketing campaign with existing customers. The
assets have an expected useful life of 10 years and as at 31 December 2023
therefore has 9.5 years remaining.
Impairment reviews
The Directors have performed an impairment review of intangible fixed assets
and goodwill at the end of the year.
Quasar Holdings ltd (Bet90) Oddsen.nu Spinbookie .com Consolidated Totals
Emwys AB
€ € € € €
Goodwill - 1,913,600 - - 1,913,600
Other intangibles - 2,276,550 1,597,839 3,450,000 7,324,389
Other non-current assets - - - - -
CGU Carrying value at 31 Dec 2023 - 4,190,150 1,597,839 3,450,000 9,237,989
CGU Carrying value at 31 Dec 2022 368,157 4,394,349 1,797,569 - 6,560,075
Goodwill is not amortised.
In accordance with IAS 36 and the Group's stated accounting policy, an
impairment test is carried out annually on the carrying amounts of intangible
fixed assets and goodwill and a review for indicators of impairment is carried
out for other non-current assets. Where an impairment test was carried out,
the carrying value is compared to the recoverable amount of the asset or the
cash-generating unit. The recoverable amount for Quasar Holdings ltd (Bet90)
and Oddsen.nu were assessed for impairment given the allocation of goodwill
with an indefinite useful life requiring annual review. In each case, the
recoverable amount was the value in use of the assets, which was determined by
discounting the future cash flows of the relevant asset or cash-generating
unit to their present value.
The recoverable amount of the Quasar holdings ltd (Bet90) was impaired to nil,
as the Bet90 operations were terminated and the brand is now used for a
different purpose, being an affiliate website.
The recoverable amount of the Oddsen.nu, Spinbookie and Emwys CGU's as at 31
December 2023, of €4.2 million, €1.6 million and €3.45 million
respectively, has been determined based on a value in use calculation using
cash flow projections from financial budgets approved by the Directors. Key
assumptions in performing the value in use calculation are set out below.
Key assumptions and inputs used:
Cash flow projections have been prepared for a five-year period, following
which a long-term growth rate has been assumed. Underlying growth rates, as
shown in the table below for each of Quasar Holdings ltd (Bet90), Spinbookie
and Oddsen.nu, have been developed through projections of future player
acquisitions and net gaming revenue based on data obtained from partners and
affiliate partners
The pre-tax discount rate that is considered by the Directors to be
appropriate is based on the Group's specific Weighted Average Cost of Capital,
adjusted for tax, which is considered to be appropriate for the
cash-generating units.
Pre-tax Underlying Underlying Long-term
discount rate revenue growth rate revenue growth rate
applied year 1 growth rate year 6+
years 2-5
At 31 December 2023
Oddsen.nu 14.6% 38.3% 5.8% 2%
Spinbookie assets 18.95% 9.8% 21.4% 2%
Emwys AB 17.0% 35.3%* 34.9% 2%
At 31 December 2022
Quasar Holdings ltd (Bet90) 18.45% 163% 15.7% 2%
Oddsen.nu 14.6% 1% 5% 2%
Spinbookie assets 18.45% 146% 18% 2%
*Emwys growth rate is the 2024 expected revenues compared to the annualised 5
months of 2023.
The Group has impaired the goodwill related to Quasar Holdings ltd (Bet90) for
the amount of €315,116.
The calculation of value in use for the Oddsen.nu is most sensitive to the
following assumptions:
● Revenue - A reduction in the revenue cumulative annual growth rate
("CAGR") for years 1-5 from 11.6% down to 10.5% would result in the
recoverable amount equalling the carrying value.
● Weighted Average Cost of Capital - Whereas the Directors believe
the WACC rate is conservative, an increase in WACC rate to 15.7% would result
in the recoverable amount equalling the carrying value.
The calculation of value in use for the Spinbookie is most sensitive to the
following assumptions:
● Revenue - A reduction in the revenue cumulative annual growth rate
("CAGR") for years 1-5 from 19.0% down to 17.7% would result in the
recoverable amount equalling the carrying value.
● Weighted Average Cost of Capital - Whereas the Directors believe
the WACC rate is conservative, an increase in WACC rate to 20.5% would result
in the recoverable amount equalling the carrying value.
The calculation of value in use for the Emwys asset is most sensitive to the
following assumptions:
● Revenue - A reduction in the revenue cumulative annual growth rate
("CAGR") for years 1-5 from 35.0% down to 9.6% would result in the recoverable
amount equalling the carrying value.
● Weighted Average Cost of Capital - Whereas the Directors believe
the WACC rate is conservative, an increase in WACC rate to 90.8% would result
in the recoverable amount equalling the carrying value.
The annual impairment review on goodwill and the intangible fixed assets
showed that an impairment was needed for the Quasar Holdings ltd goodwill for
the year 2023. For the other assets, no impairment was necessary for the years
2023 and 2022.
Note 11: Trade and other receivables
Year ended Year ended
31 December 2023 31 December 2022
€ €
VAT receivables 23,133 37,113
Accounts receivable 282,528 52,532
Contract assets 142,130 -
Other receivables and prepayments 40,195 103,982
Total 487,986 193,627
Credit risk arises when a failure by counter parties to discharge their
obligations could reduce the amount of future cash inflows from financial
assets on hand at the reporting date. The Group has policies in place to
ensure that provision of services is made to customers with an appropriate
credit history and monitors on a continuous basis the ageing profile of its
receivables.
The Group's exposure to credit risk is influenced mainly by the individual
characteristics of each customer. However, management also considers the
factors that may influence the credit risk of its customer base, including the
default risk of the industry and country in which customers operate. Due to
the nature of the Group's operations the Group only has a few customers which
operate with credit terms.
Impairment
A provision for impairment of trade receivables is established using an
expected loss model. Expected loss is calculated from a provision matrix
based on the expected lifetime default rates and estimates of loss on default.
We have recorded no impairment charge for the year ended 31 December 2023
(€23,450 for the year ended 31 December 2022).
Note 12: Cash and cash equivalents
Year ended Year ended
31 December 2023 31 December 2022
€ €
Cash held in current accounts and wallets 829,116 359,053
Total 829,116 359,053
Included within the cash and cash equivalents are balances held in relation to
the matching liabilities to customers shown in Note 19.
Note 13: Share capital
Year ended Year ended
31 December 2023 31 December 2022
€ €
Allotted, called up and fully paid
439,518,227 (2022: 282,144,816) Ordinary shares - -
Par value of the shares nil nil
During the year the Company issued 157,373,411 New Ordinary Shares, on the
following dates:
Date: New Ordinary Shares Pursuant to:
15 September 2023 36,731,551 Fundraise via Equity
15 September 2023 86,810,441 Conversion of Convertible Loan Note plus accrued interest
15 September 2023 25,271,308 Acquisition of Emwys AB
15 September 2023 8,560,111 Conversion of payables
157,373,411
Note 14: Additional paid in capital
Additional paid in capital represents amounts subscribed for share capital in
excess of par value. Details of additions are described in Note 13 above.
Note 15: Reverse asset acquisition reserve
The reverse acquisition completed on 30 June 2016 has been accounted for as a
share-based payment transaction in accordance with IFRS 2. On the basis of the
guidance in paragraph 13A of IFRS 2, the difference in the fair value of the
consideration shares and the fair value of the identifiable net assets should
be considered to be payment for the services to transition to a public
company.
Note 16: Retained earnings
Retained earnings represents the cumulative net gains and losses recognised in
the consolidated statement of comprehensive income and other transactions with
equity holders.
Note 17: Share based payments
The following options and warrants in the Group were granted, exercised,
forfeited or existing at the year-end:
Date of grant Exercise price Existing at 1 January 2023 Granted in the year Cancelled or forfeited in the year Exercised in the year Existing at 31 December 2023 Exercisable at 31 December 2023 Expiration date
Options
14 Febr 2019 15p 550,000 - - - 550,000 550,000 13 Febr 2024
17 Mar 2021 5p 6,150,000 - - - 6,150,000 3,075,000 16 March 2026
1 Oct 2021 13p 13,505,000 - - - 13,505,000 6,752,500 30 Sept 2026
21 June 2022 5p 2,000,000 - - - 2,000,000 500,000 20 June 2027
7 Nov 2022 5p 750,000 - - - 750,000 187,500 6 Nov 2027
18 April 2023 6.2p - 11,500,000 - - 11,500,000 - 17 April 2028
27 Oct 2023 5p - 1,000,000 - - 1,000,000 - 26 Oct 2028
Warrants:
17 Mar 2021 5p 750,000 - - - 750,000 750,000 16 March 2024
9 Sept 2022 4.18p 3,588,500 - - - 3,588,500 3,588,500 8 Sept 2025
TOTAL 27,293,500 12,500,000 - - 39,793,500 15,403,500
All options have a 5 year term and vest over 4 equal yearly instalments
starting 1 year after the grant date.
The number and weighted average exercise prices of share options and warrants
are as follows:
Number of share options and warrants Weighted average exercise price (£)
Outstanding as at 1 January 2022 21,954,846 0.131
Exercisable as at 1 January 2022 1,797,346 0.153
Options forfeited on 31 January 2022 (90,000) 0.072
Options lapsed on 22 May 2022 (800,000) 0.250
Options granted on 22 June 2022 2,000,000 0.050
Warrants granted on 9 September 2022 3,588,500 0.040
Warrants lapsed on 30 June 2021 (109,846) 0.150
Options granted on 9 November 2022 750,000 0.050
Outstanding as at 31 December 2022 27,293,500 0.090
Exercisable as at 31 December 2022 9,664,750 0.079
Options granted 18 April 2023 11,500,000 0.062
Options granted 27 October 2023 1,000,000 0.050
Outstanding as at 31 December 2023 39,793,500 0.075
Exercisable as at 31 December 2023 15,403,500 0.079
The options outstanding as at 31 December 2023 had a weighted average
remaining contractual life of 3.25 years, whereas the warrants outstanding had
a weighted average remaining contractual life of 1.5 years. The value of the
options has been derived by using a Black Scholes pricing model for the
options and warrants granted on 22 June 2022, 9 November 2022, 18 April 2023
and 27 October 2023. The inputs into the pricing models were as follows:
Options granted on 22 June 2022 Options granted on 9 November 2022 Options granted on 18 April 2023 Options granted on 27 October 2023
Share price at grant date £0.05 £0.035 £0.062 £0.045
Exercise price £0.05 £0.05 £0.062 £0.05
Volatility 37.4% 37.4% 54.5% 54.6%
Expected life 5 years 5 years 5 years 5 years
Risk free rate 3.38% 3.38% 3.69% 4.9%
Expected dividend yield 0% 0% 0% 0%
Although the Company has been trading its shares on the AIM market of the
London Stock Exchange since 30 June 2016, the liquidity in the stock is low.
Furthermore, the stock price was suspended for trading between March 2020 and
March 2021, therefore the expected volatility for all options was determined
by taking the average the Company's share price and the historical volatility
of a peer group over a 5-year period.
The charges to the Consolidated statement of comprehensive income are a
follows:
Grant date: Value of options: Charged Charged Remainging charge Remaining charge years
to 2023 to 2022
17 Mar 2021 €108,401 €24,464 €35,005 €4,236 2024-2025
1 Oct 2021 €660,767 €189,786 €302,852 €82,092 2024-2025
21 June 2022 €44,186 €32,679 €11,506 - -
18 April 2023 €414,535 €152,932 - €261,603 2024-2027
27 Oct 2023 €29,070 €2,523 - €26,547 2024-2027
TOTAL €1,256,959 €402,384 €349,363 €374,478
Note 18: Borrowings
31 December 2023 31 December 2022
€ €
Convertible loan(1) - 648,466
Accrued interest - 7,180
- 655,646
(1) The 2022 Convertible Loan Note had a 3 year term, bears a 10% coupon,
which accrued and is added to the principal amount. The Loan was converted by
the Company on 15 September 2023.
The Convertible Loan Notes ("CLNs") are accounted for as a liability under
IFRS 9.
During the year the CLNs issued have been converted to Ordinary Shares of the
Company in September 2023. The CLNs included the option for the Company to
call conversion, which was executed. Pursuant to the terms of the CLNs, the
conversion price was applying a 10% discount to the 5 day volume weighted
average share price just before conversion.
Upon conversion, the CLNs' liability is derecognized from the balance sheet
and the additional paid-in capital is recognised at fair value. The number of
ordinary shares issued upon conversion is determined based on the market price
of the Company's shares at the date of conversion less the 10% discount.
Note 19: Trade and other payables
31 December 2023 31 December 2022
€ €
Trade payables 757,985 1,201,131
Accrued expenses 613,399 465,707
Liabilities to customers 129,263 115,542
Other creditors 783,123 1,427,964
2,283,770 3,210,344
Note 20: Capital commitments
At 31 December 2023 and 31 December 2022 there were no capital commitments.
Note 21: Contingent assets and liabilities
There were no contingent liabilities at 31 December 2023 or 31 December 2022.
Note 22: Deferred tax
31 December 2023 31 December 2022
€ €
At 1 January 259,920 273,600
Credit to profit and loss (25,992) (13,680)
At 31 December 233,928 259,920
During 2023 the expected net reversal of deferred tax of €25,992 (2022:
€13,680) relates to amortization of intangible assets.
Note 23: Financial instruments - Fair Value and Risk Management
The Group is exposed through its operations to risks that arise from use of
its financial instruments. The Board approves specific policies and procedures
in order to mitigate these risks.
The main financial instruments used by the Group, on which financial risk
arises, are as follows:
● Cash and cash equivalents;
● Trade and other receivables;
● Trade and other payables; and
● Customer deposits in case of the Spinbookie operations.
Detailed analysis of these financial instruments is as follows:
2023 2022
Financial assets € €
Trade and other receivables (Note 11) 424,658 52,532
Cash and cash equivalents (Note 12) 829,116 359,053
Total 1,253,774 411,585
In accordance with IFRS 9, all financial assets are held at amortised cost.
2023 2022
Financial liabilities € €
Trade and other payables(1) (Note 19) 1,644,612 2,179,077
Accrued liabilities 613,399 465,707
Borrowings (Note 18) - 655,646
Total 2,258,011 3,300,430
(1)Excludes taxes payable.
In accordance with IFRS 9, all financial liabilities are held at amortised
cost.
Capital
The capital employed by the Group is composed of equity attributable to
shareholders. The primary objective of the Group is maximising shareholders'
value, which, from the capital perspective, is achieved by maintaining the
capital structure most suited to the Group's size, strategy, and underlying
business risk. There are no demands or restrictions on the Group's capital.
The main financial risk areas are as follows:
Credit risk
Trade receivables
For the Group's operations in Spinbookie, the credit risk relates to customers
disputing charges made to their credit cards ("chargebacks") or any other
funding method they have used in respect of the services provided by the
Group. Customers may fail to fulfil their obligation to pay, which will
result in funds not being collected. These chargebacks and uncollected
deposits, when occurring, will be deducted at source by the payment service
providers from any amount due to the Group. The risk for the year 2023 has
been assessed by the Board to being immaterial.
Financial assets which are past due but not impaired
2023
Not yet overdue Up to 3 months over due Up to 12 Over 1 year over due Total
months over due
€ € € € €
Trade receivables 134,192 102,798 45,538 - 282,528
Other receivables 142,130 - - - 142,130
Total 276,322 102,798 45,538 - 424,658
2022
Not yet overdue Up to 3 months over due Up to 12 Over 1 year over due Total
months over due
€ € € € €
Trade receivables 52,532 - - - 52,532
Other receivables - - - - -
Total 52,532 - - - 52,532
Liquidity risk
Liquidity risk exists where the Group might encounter difficulties in meeting
its financial obligations as they become due. The Group monitors its
liquidity in order to ensure that sufficient liquid resources are available to
allow it to meet its obligations.
The following table details the contractual maturity analysis of the Group's
financial liabilities:
2023
On demand In 3 months Between 3 More than 1 year Total
months and 1 year
€ € € € €
Trade and other payables(1) 1,519,612 62,500 62,500 - 1,644,612
Accrued liabilities 613,399 - - - 613,399
Total 2,133,011 62,500 62,500 - 2,258,011
(1)Excludes taxes payable.
2022
On demand In 3 months Between 3 More than 1 year Total
months and 1 year
€ € € € €
Borrowings - - - 655,646 655,646
Trade and other payables(1) 2,009,077 170,000 - - 2,179,077
Accrued liabilities 12,666 453,041 - - 465,707
Total 2,021,743 623,041 - 655,646 3,300,430
(1)Excludes taxes payable.
Note 24: List of subsidiaries
The Company held the issued shares of the following subsidiary undertakings as
at 31 December 2023:
Name of subsidiary Place of Incorporation Proportion of ownership and voting power Ownership
B90 Ventures Ltd Isle of Man 100% Direct
B90 Services BV The Netherlands 100% Direct
Sheltyco Enterprises Group Ltd British Virgin Islands 100% Direct
T4U Marketing Ltd Cyprus 100% Indirect, through Sheltyco Enterprises Group Ltd
Quasar Holdings Ltd Malta 100% Indirect, through B90 Ventures Ltd
Bet90 Sports Ltd Malta 100% Indirect, through Quasar Holdings Ltd
B90 Operations Ltd Bulgaria 100% Indirect, through B90 Ventures Ltd
It's a Winner Ltd Malta 100% Indirect, through B90 Ventures Ltd
Spinbookie ltd Malta 100% Indirect, through B90 Ventures Ltd
Spintastic NV Curacao 100% Direct
Spin Marketing BV Curacao 100% Direct
Emwys AB Sweden 100% Direct
Note 25: Reconciliation of debt
The Group had the following movement in the borrowings:
2023
At 1 January 2023 Cash Fair Value and accrued interest Conversion At 31 December 2023
of balance
€ € € € €
Borrowings 655,646 4,253,116 1,150,130 (6,058,892) -
655,646 4,253,116 1,150,130 (6,058,892) -
2022
At 1 January 2022 Cash Accrued interest At 31 December 2022
€ € € €
Borrowings - 648,466 7,180 655,646
- 648,466 7,180 655,646
Note 26: Related party transactions
Remuneration of Directors and key employees
Remuneration of Directors and key employees is disclosed in Note 5.
Other related party transactions
Included within other creditors, the Group has accrued for unpaid salaries
with its Directors, amounting to €26,700 at 31 December 2023 (2022:
€45,250).
Intra group transactions
Transactions between Group companies have not been disclosed as these have all
been eliminated in the preparation of the Consolidated Financial Statements.
Note 27: Ultimate controlling party
As at 31 December 2023 the Directors do not believe there to be any single
controlling party.
Note 28: Subsequent events
On 1 February 2024, the Company announced that it had successfully completed
the transition of the operations, including partnering with a specialised
platform and operations partner for the Spinbookie operations.
--------------------------------------------
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