Webis Holdings non-executive chair Denham Eke stated that the company is “optimistic about the future potential growth of the business” despite reporting a larger net loss for H1.
The turnover for the first six months of 2023 was $5,9m (PS4.7m/EUR5.4m). The $6.2m that Webis reported the year before was just 4.8% less than the $5.9m (PS4.7m/EUR5.4m) for the same period.
Eke and Webis attribute this decline to external factors, primarily in the second quarter. He said that bad weather caused many US events to be cancelled. Eke, on the other hand, said that trading is stronger in the summer.
Webis’s loss was widened by the decline in turnover and level spending during H1. Eke, however, is optimistic about Webis’ performance in the second half.
Eke stated that “our principal subsidiary WatchandWager.com had again a diverse start to the first half of the financial years.” I remain confident that the trading will continue to improve, particularly as we roll out our B2C strategy.
B2C Webis surpasses expectations of the market
Webis’ B2C Division performed better than expected during H1. The overall US advanced deposit betting market fell by 10.8% on an annual basis. Webis stated that this was due to the rising cost of living and the increase in other gaming forms, such as online sports betting.
Handle and the number of active users on platform have remained stable despite the downward trend in market. This sector also contributes to over 80% gross margin of ADW.
Webis stated that B2B is important for the business but the market has become “increasingly crowded”. The company also stated that B2B margins were significantly lower than those derived from sales to consumers.
Webis has also renewed its licenses for the US, the Isle of Man and other countries.
Eke stated that “we consider our licenses as a major asset for the group in addition to rights to content.”
Loss net increases to $541,000
In H1, all expenses, such as cost of sales ($4.1m) and wagering duty ($48,000), were lower. Operating costs decreased by 0.4%, to $2.3m.
This was insufficient to prevent the operating loss from increasing by 90.2%, to $464,000. Webis reported $77,000 of finance costs. This left a loss before tax of $541,000 compared with $325,000 the year prior.
Webis has not paid any taxes in H1 meaning that the net loss is also $541,000 which is higher than $325 in 2022-2023.
Webis highlights areas of growth
Eke says that the Webis Board has agreed to focus on four areas in order to grow.
Eke said that this will improve the margin for business. Eke says that this will increase the margins for business. Webis also plans to expand its land-based licenses in California and possibly other states.
Webis also aims to offer third-party services to new and existing entrants to the US. Webis is looking for new business opportunities on the US regulated market, which has been growing.
Eke commented on the final point. “The bigger operators and newcomers to the market are both looking for stable operations that they can either acquire or merge with.” This is what WatchandWager provides.
The board has instructed the key executive to explore these opportunities if there is a benefit for shareholders. We will inform shareholders of any developments that occur in this field.
