The COVID-19 pandemic has had a negative impact on the entire global economy. After collective international efforts that opened up the world after the introduction of vaccines, the global economy gradually started to recover.
But just as most companies were beginning to pick up the pieces of the pandemic, the war between Russia and Ukraine exacerbated the woes of the global economy.
Like most industries, the gambling and gaming industry has faced hurdles during these challenging financial times. At the height of the outbreak, casinos, gambling establishments such as taverns, breweries, bingo halls and others were forced to close.
The shutdowns brought online gambling into the limelight as more and more gamblers turned their bets towards more accessible options.
But even with a post-COVID recovery that paints a positive picture of the global gaming industry, there is evidence that the gaming industry — including companies like Light & Wonder Inc. LNW, Boyd Gaming Corp. BYD and Churchill Downs Inc. CHDN — may still face some growth challenges.
another player, Golden Matrix Group Inc. GMGIAbelieves it to be a diamond in the rough.
Golden Matrix develops and licenses online gaming platforms and systems. In particular, it is a pioneer in providing highly modular, configurable and scalable gaming platforms for its global clients to drive user acquisition, engagement, retention and monetization.
Even amid the global economic downturn, the company continues to report impressive year-over-year revenue growth. Golden Matrix CEO Brian Goodman told Benzinga in an exclusive interview that these continued successes did not come by chance.
“We’re unusual as a gambling company because we’re very profitable and we’re generating positive cash,” Goodman said. “I mean, a lot of these online gambling companies are losing hundreds of millions, billions of dollars and keep burning money.”
Recession and growth of online gambling
Goodman noted that a recession could hit many companies, but sin stocks like gambling, tobacco, marijuana and alcohol usually do well. He said he does not expect any negative impact on the gambling or gaming industry.
Using the US as an example, Goodman explained that as more states take steps to provide a legal framework to regulate the gaming industry, it could open up huge opportunities for the market, especially online gaming.
“If you don’t have an online presence in today’s world, then you’re a dinosaur,” Goodman said. “Obviously, if companies don’t have an online presence, they can’t compete in today’s world.”
This realization has led land-based operators to bring their businesses online, especially due to the impact of COVID-19 on the industry.
“There’s a huge pressure to have a part of your business online, and that obviously fuels the online gambling market.”
Expansion into new markets
Golden Matrix is hosting a pay-to-enter prize competition in the UK and Ireland. The company says its lottery business, which it acquired about a year ago, has performed exceptionally well.
The tech CEO revealed that what makes the lottery business unique is that when people win the valuable prizes they have staked, sometimes the winners have the option to choose money instead of the prize they won.
Another valuable part of the lottery, he added, is that the company can buy customers at a lower rate.
“If the acquisition cost were to be around $3 per person, most gambling companies in the US spend about $500 or $600 per player,” he said.
Golden Matrix has plans to take the lottery tickets to new markets, but there are challenges. In addition to regulatory hurdles, which are sometimes easy to overcome, there is the issue of language barriers.
Still, Goodman says the company is making progress.
“We are about to launch our online casino in Mexico using a gambling license granted to the company, and we want to expand into other LATAM markets starting with Brazil,” he said. “We have assembled a skilled Spanish and Portuguese team and we are confident that these highly scalable and logical expansions of our business will be well received by players in these new markets and make a meaningful contribution to GMGI’s overall revenue and profit. “
Profitability and revenue growth
Golden Matrix reports that it is on track to increase sales by more than 250% this year, with a profitability of about 50% according to Goodman.
“We are hopeful that we will continue to deliver these results. The company has a lot of money on its balance sheet. It has a very strong balance sheet,” Goodman said.
The company also wants to acquire other creative companies that can add value to its activities.
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