Public Filing of Registration
Statement on Form F-1 for
U.S. Listing on the Nasdaq

London | March 25, 2020: GAN plc (“GAN” or the “Company”), an award-winning developer and supplier of enterprise-level B2B Internet gambling software, services and online gaming content in the United States, today provided a market update including an update in light of the recent developments regarding COVID-19. 
 
The Company maintains online only gaming operations, and the successful implementation of “Work from Home” was completed on March 13. As a wholly digital business, GAN has not experienced any interruption in technical development, and/or technical operations conducted to support its clients. Furthermore, early indications of a material shift from retail gambling to online gambling is anticipated to be positive for GAN’s overall revenue opportunity during this time.
 
Update on the Nasdaq Listing
The Board of Directors, in consultation with its financial advisers, continues to be committed to the Nasdaq listing following the issuance of the UK Scheme of Arrangement documents to shareholders on March 13, 2020, with a shareholders meeting scheduled for March 31, 2020. The Company is publicly filing a registration statement on Form F-1 with the U.S. Securities and Exchange Commission (the “SEC”) today relating to the proposed public listing of common stock in GAN Limited. The public listing is expected to take place after the SEC completes its review process, subject to market and other conditions. The number of ordinary shares to be offered and the price range for the proposed offering have yet to be determined.   
 
The Form F-1 registration statement has not yet become effective. These securities to be registered may not be sold nor may offers to buy be accepted prior to the time when the registration statement becomes effective. This press release shall not constitute an offer to sell or the solicitation of an offer to buy any securities in the United States, nor shall there be any sale of these securities in any state or other jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction. Securities may not be offered or sold in the United States absent registration or an exemption from registration, and any public offering of securities to be made in the United States will be made solely by means of a prospectus that may be obtained from the Company and that will contain detailed information about the Company and management, as well as financial statements.
 
The Form F-1 filing includes certain financial information for the year ended December 31, 2019, which is summarized below. A copy of the Form F-1 can be sourced at https://www.sec.gov/edgar/search-and-access.  
 
2019 Financial Overview

• Net Revenue of $30.0m (2018: $14.0m), an increase of 114% on 2018
• Adjusted EBITDA1 of $8.4m (2018: loss of $1.7m)
• Income before tax of $2.4m (2018: loss of $8.6m) and earnings per share of $0.08 (2018: loss per share of $0.39)
• Income for the year of $1.8m (2018: loss of $7.7m)
• Cash and cash equivalents at the end of the year of $10.1m (2018: $7.0m)
• Total Assets at the end of the year of $26.1m (2018: $22.6m)
• Concluded FY 2019 with strong, debt-free balance sheet and $2.8m positive cash flow for the year

(1) Adjusted EBITDA is a non-GAAP Company specific measure and excludes interest, tax, depreciation, amortisation, share based payment expenses, impairment of intangible assets and other items which the directors consider to be non-recurring and one time in nature.

Real Money Internet Gambling in the U.S.
Taking the State of New Jersey as the bellwether for U.S. Internet gambling, since February 23 we have conducted an extensive review of the expected impact of COVID-19 on Internet gambling together with the International gambling consultancy Regulus Partners, and the Company comments as follows:

• Prior to March 12, 2020, the New Jersey Internet gambling market was expected to generate $976M in gross revenue in 2020, comprising $312M from sports betting and $665M from Internet gaming;
• Internet gaming in New Jersey may increase +2% to $677M, to reflect the substitution effect as Internet sports bettors shift a proportion of their wallet into Internet gaming, which the Company has already experienced as an emerging trend. For illustrative purposes only, daily new first-time depositors of GAN client Ocean Casino Resort increased +719% against the month-to-date daily average with a +57% increase in the value of daily deposits, on the first day after Atlantic City shuttered all retail casino properties consequent to local government direction;
• Internet sports betting in New Jersey may decline -14% in the full year 2020 from $312M to $255M, which the Company has already experienced as an emerging trend. This assumes the regular U.S. sports calendar substantially resumes in August 2020 and the 2020/21 NFL Sports betting season commences in September 2020 (“Impact Period”);
• Internet sports betting revenues in Q1 2020 were ahead of expectations as on the date the Impact Period commenced (March 12, 2020) and, despite subsequent material reduction in sports betting revenues, are expected to remain ahead of expectations for Q1 (Internet sports betting revenues were approximately 12.4% of participatory recurring revenues in 2019); and
• Gross Operator Revenues in Q1 2020 are currently estimated to be in excess of $140M, up from $120.8M in Q4 2019 with Gross Operator Revenues from Internet casino gaming in the United States increased +341% YoY since the commencement of the Impact Period on March 12.

Other Business Units

Italian Regulated Gaming Market
In the Italian regulated Internet gambling market, the Company has seen significant increases of betting activity by end user gamblers, in excess of the +13.9% increases reported on March 10, 2020. Following imposition of certain measures on February 23, +17.6% more online bets have been processed year-on-year via GAN’s technology Platform in Italy during the following twenty-four (24) days. The Company believes this accelerating trend will continue throughout March and into April.

Simulated Gaming
In Simulated Gaming, as of today’s date, all U.S. casino operator clients have closed their retail casino properties, and the majority of those clients have undertaken unprecedented marketing promotion of GAN’s Simulated Gaming service in order to continue to engage and monetize their patrons online, while the retail gaming properties are closed during the Impact Period. As a direct result, the Company has seen an acceleration of revenues among those clients, which are expected to drive substantially greater growth in both revenue and Adjusted EBITDA from Simulated Gaming throughout the Impact Period to benefit the full year 2020. For illustrative purposes only, carded patrons of GAN’s largest operating client increased their aggregate value of daily Simulated Gaming purchases +86% against the month-to-date daily average, on the first day this client electively shuttered all their retail casino properties.

New Client Wins: Penn National and Michigan-based Tribal Casino
The Company now confirms both (i) a major new client win for Simulated Gaming, Penn National, which represents the largest U.S. casino operator of B2B social casino gaming expected to drive incremental revenue growth commencing August 2020 and (ii) Market Access arrangements with the Sault Tribe of Chippewa Indians a Native American Tribal Casino operator in the State of Michigan, which will see GAN undertake substantial Internet gaming operations commencing early 2021 together with an anonymous existing client of both Simulated Gaming and real money Internet gambling, whose identity will be confirmed in due course. Both these new client wins will be further clarified by way of a standalone Regulatory News Service statement, in the coming days. There are several new client opportunities available to GAN for both real money Internet gambling and Simulated Gaming throughout the balance of 2020.

Reiteration of Full Year Forecasts
Based on the information set out above, GAN today confirms that the Company is trading in line with the Board of Directors’ expectations and reiterates confidence in full year 2020 revenue.

Management Commentary

Dermot Smurfit, CEO of GAN commented:

“The recent global pandemic has caused immense tragedy for so many affected by the virus and significant disruption to a multitude of business operations. Our thoughts are with all these people. We are extremely fortunate to be an online-only business in the wake of the social distancing mandated by governments around the globe and especially in our key markets of Italy and the United States.GAN will be doing all it can to ensure responsible as well as responsive operations during this tragic and difficult period. Despite recent market turmoil, our equity capital markets strategy remains to secure the Company’s Nasdaq listing next month, subject to market conditions, as we firmly believe that our growth opportunity in the U.S. remains intact, albeit in a differently weighted product mix throughout the balance of 2020.As directors we will act in the best interests of all shareholders in considering the merits of any capital raising activity consequent to the Nasdaq listing and in light of the recent share price movements we will remain highly sensitive to the issue of shareholder dilution. The Company’s resilience during this difficult time should meaningfully resonate with investors that seek to diversify their exposure to our rapidly growing end markets with our online-only products and capabilities.”

About GAN Plc
GAN is a leading business-to-business (“B2B”) supplier of internet gambling software-as-a-service solutions (“SaaS”) to the US land-based casino industry. The Company has developed a proprietary internet gambling enterprise software system, GameSTACK™, which it licenses principally to land-based US casino operators as a turnkey technology solution for regulated real-money internet gambling, encompassing internet gaming, internet sports gaming and virtual Simulated Gaming. 

GAN is listed on the London Stock Exchange (LSE: GAN).

For more information please visitwww.GAN.com.