Shares in affiliate business XLMedia are trading higher today (27 July) after the firm revealed revenue for the first half of 2022 is expected to total $44.5m, an increase of 38.2% year-on-year.
That increase was driven by rapid growth in the US, where XLMedia’s sports betting revenue during the period totalled $30.2m, up more than fivefold from the prior-year period, when it came to just $5.9m.This led to a significant increase in XLMedia’s overall sports betting revenue, which grew 190.6% to $34m when adding in $3.8m of revenue from European sports betting.
Growth in the US was driven by XLMedia’s strategic acquisitions in the region, namely Sports Betting Dime and Saturday Football Inc.
The firm said those brands have enabled it to provide exclusive and relevant local content to a national audience.
Those acquisitions took place in 2021, with the purchase of Sports Betting Dime completed last March for $35.6m and Saturday Football Inc in September for $24m.
Those purchases were part funded through a March 2021 equity raise, with future acquisition payments and earnout elements of the deals largely funded by XLMedia’s free cashflow.
The business said it expects to make further deferred consideration payments of around $7.7m in the second half of this year. Its cash balances as of 30 June 2022 were around $17.7m.Outside sports betting, XLMedia said its restructured casino and bingo vertical was trading in line with targets, generating revenue of $8.4m during the period. This, however, represents a reduction of 32.8% when compared to H1 2021’s $12.4m.
A reduction in iGaming revenue likely comes as no surprise to the business, which has taken steps to rationalise its casino assets during the period, reducing from more than 3,000 separate websites to around 45.
This has allowed the firm to begin upgrading site infrastructure and to develop shared working practices within the division, it said.
Similarly, XLMedia’s personal finance division took a significant hit during the period, delivering revenue of just $800,000, down from $6.6m in H1 last year.
That decline was driven by the need to replace ageing technology, reevaluate marketing tactics and align with best practice, the business said.
The production and management teams in the personal finance vertical – which are now based within XLMedia’s US division – are focused on completing the redesign and re-platforming of the division’s primary websites, with the objective of improving site performance, enhancing the customer experience and stabilising revenues, the firm said.
Following the end of the period, XLMedia appointed former CEO of regional newspaper group JPIMedia David King as its new chief executive, replacing Stuart Simms.
The firm’s full H1 2022 financial results are expected to be released in September.