Galaxy Gaming reported a profitable quarter as its revenue nearly tripled in Q3 2021, driven entirely by license fees. The company generated $2.8 million from regions including Europe, Africa, and the Middle East, reflecting a 157.7% increase from the previous year. North America and the Caribbean contributed an additional $2.3 million, a remarkable 250.0% rise.
Total expenses for the quarter reached $4.1 million, increasing from $2.7 million the year before. The largest component was general and administrative costs, which totaled $2.7 million. Additionally, Galaxy incurred $722,475 in depreciation and amortization, $449,565 in share-based compensation, and $156,768 in research and development.
Operating income stood at $1.2 million, a positive shift from the $898,303 loss reported in 2020. After accounting for $195,482 in share redemption considerations, $129,422 in interest expenses, $33,781 in foreign currency losses, and $21,186 in income taxes, the net income for the quarter amounted to $874,236, reversing last year's losses of $1.3 million.
The adjusted earnings before interest, taxation, depreciation, and amortization (EBITDA) soared to $2.5 million for the quarter, showing a dramatic increase of 6,844.4% compared to 2020.
Todd Cravens, Galaxy’s president and CEO, commented, “In the third quarter of 2021, the Company showed the potential we have been working toward since early 2020. Revenue, Adjusted EBITDA and Adjusted EBITDA Margin all set records, even as a meaningful portion of our UK land-based customers remained closed in the quarter. We expect our land-based business to continue to recover from the COVID closures and for our online business to continue to grow in both Europe and North America.”
CFO Harry Hagerty noted, “The recovery of our business in the brick-and-mortar space continues, and we are benefitting from strength in the online sector. As a result, our liquidity is improving. We're hopeful that these trends will continue for the balance of 2021 and into 2022.”
Additionally, Galaxy announced it has fulfilled its settlement with Triangulum Partners, an accounting equipment firm, along with its former chairman and CEO, Robert Saucier. This was accomplished via a term loan credit agreement with Fortress Credit Corp, estimated at about $60 million.
Triangulum had previously sued Galaxy over a dispute regarding regulatory matters, attempting to compel them to sell their shares. Reflecting on the settlement, Cravens remarked, “The Fortress transaction and the resulting satisfaction of the Settlement Agreement are a major achievement for Galaxy. The expense and uncertainty of the Triangulum litigation are behind us, allowing us to focus all of our efforts on customers, products, and business development. We appreciate the confidence in us that Fortress has shown, and we look forward to a mutually rewarding relationship. Finally, we are very grateful for the support that Nevada State Bank gave us during the three-plus years of our lending relationship with them, and we look forward to continuing our relationship on the treasury side.”
