UP YOUR GAMING Investor Presentation - November 2020 - BRAGG Gaming Group
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UP YOUR GAMING
November 2020
Investor Presentation
Page 0
Forward Looking Statement
CAUTIONARY STATEMENTS
This presentation is for information purposes only and does not constitute an offer to sell or a solicitation of an offer to buy securities. The information contained herein has been prepared for the purpose of providing interested parties with general information to assist them in
their evaluation of Bragg Gaming Group (“Bragg”) and this presentation should not be used for any other purpose.
Under no circumstances may the contents of this presentation be reproduced, in whole or in part, in any form or forwarded or further redistributed to any other person. Any forwarding, distribution or reproduction of this document in whole or in part is unauthorized. By
accepting and reviewing this document, you acknowledge and agree (i) to maintain the confidentiality of this document and the information contained herein, and (ii) to protect such information in the same manner you protect your own confidential information, which shall be at
least a reasonable standard of care.
Bragg has not authorized anyone to provide additional or different information. In this presentation all amounts are in Canadian dollars unless stated otherwise.
The delivery of this presentation, at any time, will not imply that the information contained herein is correct as of any time subsequent to the date set forth on the cover page hereof or the date at which such information is expressed to be stated, as applicable, and, except as may
be required by applicable law, Bragg is under no obligation to update any of the information contained herein (including forward looking statements and forward looking information) or to inform the recipient of any matters of which it becomes aware that may affect any matter
referred to in this presentation (including, but not limited to, any error or omission which may become apparent after this presentation has been prepared).
This presentation contains “forward-looking statements” (also known as “forward-looking information” within the meaning of applicable Canadian securities laws). Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are
based on our current beliefs, expectations, assumptions and analyses made by us regarding the future of our business, future plans and strategies, our operational results and other future conditions. These forward-looking statements appear in a number of places throughout this
presentation and can be identified by the use of words, such as anticipates,” or “believes,” “budget,” “estimates,” “expects,” or “is expected,” “forecasts,” “intends,” plans,” “scheduled,” or variations of such words and phrases or statements that certain actions, events or results
“may,” “might,” “will,” “would,” “could”, “should,” “continue,” or be taken, occur or be achieved. These forward-looking statements relate to, among other things, our future financial performance, financial condition, liquidity, levels of activity, performance, prospects, growth,
goals or achievements or other future events.
Although we base the forward-looking statements contained in this presentation on assumptions that we believe are reasonable, these forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual performance and financial
results in future periods to differ materially from those anticipated in our forward-looking statements. Forward-looking statements do not take into account the effect that transactions or non-recurring or other special items
announced or occurring after the statements are made have on our business. For example, they do not include the effect of asset impairments or other charges announced or occurring after the forward-looking statements are made. The financial impact of such transactions and
non-recurring and other special items can be complex and necessarily depends on the facts particular to each of them.
“Future-oriented financial information” is forward-looking information about prospective results of operations, financial position or cash flows, based on assumptions about future economic conditions and courses of action, and presented in the format of a historical statement of
financial position, statement of comprehensive income or statement of cash flows. Similarly, a “financial outlook” is forward-looking information about prospective financial performance, financial position or cash flows that is based on assumptions about future economic
conditions and courses of action that is not presented in the format of a historical statement of financial position, statement of comprehensive income or statement of cash flows. Future-oriented financial information and financial outlook made herein or made elsewhere are
made solely based on the information available as of the date hereof and are subject to the same assumptions, risk factors and other qualifications as all other forward-looking information, and presented solely for the purpose of conveying the current anticipated expectations
and may not be appropriate for any other purposes.
Despite a careful process to prepare and review the forward-looking statements, there can be no assurance that the underlying opinions, estimates, and assumptions will prove to be correct. The purpose of the forward-looking statements is to provide the reader with a
description of management’s expectations regarding our anticipated future performance and may not be appropriate for other purposes. Furthermore, unless otherwise stated, the forward-looking statements contained in this presentation are made as of the date of this
presentation and we do not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise unless required by applicable legislation or regulation. The forward-looking
statements contained in this document are expressly qualified by this cautionary statement.
This presentation also contains or references certain market, industry and peer group data which is based upon information from independent industry publications, market research, analyst reports and surveys and other publicly available sources. Although we believe these
sources to be generally reliable, such information is subject to interpretation and cannot be verified with complete certainty due to limits on the availability and reliability of raw data, the voluntary nature of the data gathering process and other inherent limitations and
uncertainties. We have not independently verified any of the data from third party sources referred to in this presentation and accordingly, the accuracy and completeness of such data is not guaranteed.
Page 1
Management Team
Richard Carter Adam Arviv Ronen Kannor Yaniv Spielberg Matevz Mazij
Chairman of the Board Founder & Interim-CEO Chief Financial Officer Chief Strategy Officer MD & Founder of Oryx
• Prior to joining Bragg as • Founder and significant • Over 18 years of experience • Joined in 2018 and helped • Founded Oryx in 2012 after
Non-Executive Chair, shareholder of Bragg in financial management complete the RTO to spending eight years as an
Richard was the CEO of Gaming within online gaming establish Bragg international business
interactive sports betting • 30 years of gaming • Most recently served as CFO • Prior to Bragg, was a development professional
solutions and services experience in M&A, at Stride Gaming Plc, an founding member of a with different online and
provider SB Tech. investments and operations online gaming operator, private equity fund that land-based gaming
• Richard lead the company from 2014 until 2020, where focused on acquiring and companies
• Previously helped lead
for over 5 years, until the Gaming Nation, Picknation. he led the reorganization operating global online • Since then has led Oryx to
company’s merger with and IPO of the company into gaming companies - Legacy become a global leader in
DraftKings. the London Stock Exchange Eight Group turnkey gaming solutions
Page 2
Bragg At-A-Glance
Fast growing online B2B turnkey gaming solution provider
Bragg Gaming Group
…is an innovative B2B online Owns its own proprietary PAM, AGG, and
gaming solution provider.
RGS tech stack
Bragg offers a turnkey solution for
retail, online and mobile gaming Operates only in regulated and/or licensed markets
via their proprietary iGaming
platform, which includes an
advanced casino content Profitable and highly cash-generative
aggregator, sportsbook, lottery,
marketing and operational
services. Solid growth strategy and proven model
Highly qualified management team
Page 3
Investment Highlights
Strong Historical & EBITDA Growth That Is Accelerating
• Revenue* growth +74% to C$50.5m in 9M 2020 (9M 2019: C$29.1m)
• Adjusted EBITDA increased >14x to C$6.7m in 9M 2020 (9M 2019: C$0.5m)
Large, Growing and Sticky Customer Base
• Nearly tripled customers in past two years; Bragg hasn’t lost a customer in 5+ years1
• Extensive pipeline of new customers, with 14 large wins in Q3 2020
• Total bets up 95% in Q3 2020 totaling C$5.1 billion
• Unique players up 89% in Q3 2020 as a result of significant additions to content and platform
• Popular and exclusive gaming content
Highly Scalable Online B2B Business Model
• Has reached critical mass with low marginal cost of new customers driving significant impact
• Inherently high-margin, highly-cash generative and asset light model
Expanding into the U.S., the World’s Fastest Growing Gaming Market
• Market to grow from ~C$6B to ~C$15B in next 6 years, following repeal of PASPA2
• Bragg recently announced its first major U.S. partnerships with Seneca Gaming and Kambi
Proven Management Team
• Over 40 years of combined experienced in the gaming (SBG Global, Legacy 8, Stride, etc.)
• Significant transaction and integration experience across the team
1. Excludes clients who have gone out of business
2. H2 Gambling Capital, 2020 Market Report Page 4
Our Revenue Model
Revenue Model Operational Flow Chart
• Majority of revenue is generated on a
revenue share basis Customer
• Bragg earns a % of the gross gaming
revenue (GGR) from operators using its Bingo / Virtual
Sports Betting Online Casino Lotto
platform Games
• Bragg’s revenue is paid from the Apps run on Bragg’s
operator to Bragg software platform
• Bragg is removed from operating the
Direct
actual sites and does not take any bets or Payments
Games Services
wagers Content
Buys content and
technology
Casino Operators / Clients
Page 5
Oryx products and services
Turnkey
solutions for Casino Sportsbook Lottery
A full range of gaming content Fully managed proprietary A diverse portfolio of insurance-
casino,
portfolio that includes 10.000+ Sportsbook with based lottery betting, high
games by 100+ world renowned comprehensive live and pre- frequency live lotto products and
game providers match betting offer number games products
sportsbook Oryx HUB
Content Aggregation, Product Integration & Smart Marketing Platform.
and
iGaming Platform
lottery
Omni-channel, cross-product iGP with realtime data processing, automated campaign, fraud and player management
Managed services
operations Our expert team will manage and run your marketing and gaming operation to guarantee industry leading KPI’s.
Page 6
Extensive Track Record of Customer Wins
Select Customers List
90+ 14 ~300% Zero
Customer New Customers Customer growth Customers lost in
Base added in Q3 2020 in past 2 years last 5 years
Number of Customers1
73
64
58
54
49
43 Lucky 7
36
30
25
Q1 2018A Q2 2018A Q3 2018A Q4 2018A Q1 2019A Q2 2019A Q3 2019A Q4 2019A Q1 2020A
1. Excludes clients who have gone out of business
Page 7
Selection of Recent Customer Wins
Date Won Customer Partnership Overview
Q4 2020 • Leading GameTech company in Greece; distribution of Bragg RGS content and ORYX Hub content to Kaizen’s European operations
Q3 2020 • Casino platform provider with an innovative multi-brand portfolio comprising over 20 online casinos and sportsbooks
Q3 2020 • One of the world’s leading gambling and entertainment solutions providers
Q3 2020 • Top Bet will be able to offer its local customers content from ORYX’s RGS library and titles from partnered studios
Q2 2020 • Global leader in omni-channel sports betting and gaming solutions
Q2 2020 • International bookmaker with brand presence in more than 10 countries
Q1 2020 • Pioneer in online betting and has become a leading Latin American online operator
Q1 2020 • Online provider of casino games, slots and table games
Q1 2020 • Is a lightweight integration platform built on Elixir offering wallet API for casino operations
Q4 2019 • World’s largest online lotto betting operator in addition to offering casino products
Q4 2019 • Owner of three major casinos and resorts in New York state
Page 8
Exceptional Track Record of Revenue Growth
Quarterly Revenue (C$M)
Highlights
38% -3%
19
18.1
14% REVENUE INCREASE
12% C$50.5 million in 9M 2020
13.7
17% from C$29.1 million in 9M 2019
2% -0.4%
12
10.7
9.4 9.6 9.2
REVENUE DIVERSIFICATION
Top 10 Clients = 62% 9M 2020
down from 76% in 9M 2019
Q4 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020 Q3 2020
Note: Figures presented on a pro forma basis, assuming the acquisition of Oryx occurred as of Jan 1, 2018
Page 9Rising Profitability & Margins
Annual Revenue (C$M) Adj. EBITDA & Margin (C$M)
Highlights
13.2%
13% EBITDA INCREASE
10.4
79
C$6.7 million in 9M 2020
13.2%
67 8.7 from C$0.5 million in 9M 2019
4%
50.5 6.7
41.5
EBITDA MARGIN INCREASE
13.2% in 9M 2020
1.5 from 1.4% in 9M 2019 driven by
scaling and cost control
2019A 9M 2020 FY2020E FY2021E 2019A 9M 2020 FY2020E FY2021E
Note: Figures presented on a pro forma basis, assuming the acquisition of Oryx occurred as of Jan 1, 2018
1. Represents high-end of management guidance Page 10Our Vision And Growth Strategy
To Be A Leading Online Gaming Solution Provider
1 2 3
Focus on Core Diversify New
Business Growth Product Offering Markets
• Continue to build scale • Enhance content base through • Extend into new markets
and grow market share leading studios focused on the US, Canada
in worldwide Casino • Grow products (Sportsbook, Lottery) and Latin America through Value for
markets and move into new products technology and white label
offering (B2B2C) Shareholders
(instant-win games etc.)
• Enhance iGaming platform services
Investment in Proprietary Platform
Investment in Our Team
Compliance with Regulation
Page 111 Continue to Grow Core Business
Focus on customer acquisition
• Execute on strong customer pipeline – 20+ new
customers in advanced discussions
• Rapidly grow customer base and take market share
• Expand with existing customers into their additional
operational jurisdictions
Enhanced offering and content
• Continued innovation to drive end-user
engagement (ex. Leaderboards launched May 20’)
• Continuing to generate and secure exclusive best-
in-class content
• Focus on data analytics and increasing ROI for our
customers
Increase share of customer wallet
• Increase monetization and engagement of existing
customer base
• Expand existing suite of services provided and upsell
additional services
Page 122 Diversify Product Offering
Enhance content base
Through continued partnerships with
leading studios
Enter into new products
Instant-win games, Rummy, sportsbook and
lottery product add-ons
Expand iGaming platform services
Realtime tournaments, advanced user engagement
services, etc.
Page 133 Expand Into New Markets
Extend into new markets focused on the US , Canada and Latin America through
technology and white label offering (B2B2C)
Canada
• Canadian gambling market
moving toward legalization
• Focused M&A strategy targeting:
- Increased geographic presence
- Complementary opportunities
USA Europe to supplement or enhance
• US gambling market moving toward • Currently regulated in 12 countries; largest market is Germany Bragg technology
legalization, with gaming now legal in • Growth of German-facing operators is ~30% vs ~85% for non- - Competitors to ORYX where
18 states, and regulation underway to German operators; highlights success diversification efforts significant synergies could be
legalize more states recognized
• Increased clarity of German regulations is a positive for Bragg;
• Overall industry expected to grow as anticipate growth in this region
payment issues and restrictions on
• Aim to increase European reach through strategic partnerships
marketing decrease
with suppliers & operators and via complementary M&A
Page 14U.S. Online Gaming Market Overview
U.S. Online Gaming Market (GGR)2
U.S Online & Sports (Figures in C$ billions)
Gambling Market 14.8
14.0
legalized in 2018 following
repeal of PASPA1 :1 8% 12.8
’ 2 5
8-
GR ‘1 11.5
CA
Multiple states have since Repeal of PASPA Regulation
legalized online gambling 9.0
with multiple other states
expected to follow 6.9
5.8
~C$15B market in 2025 from 4.1 4.1
4.4 4.5
~C$5B market size in 2018
18% 7-year CAGR
2015A 2016A 2017A 2018A 2019E 2020E 2021E 2022E 2023E 2024E 2025E
1. Professional and Amateur Sports Protection Act
2. H2 Gambling Capital, 2020 Market Report
Page 15North American Expansion Strategy – B2B2C Model
Sportsbook, Casino
platform, PAM, content
and processing
B2B
Licence holder
Branding Partner
Market access deal
(local partner) Leading Brand and Affiliate
for Traffic
B2C
North American
Joint Venture
Page 16North American Expansion Strategy – Partnering with Leading Brands
Prioritize Jurisdictions
where I-Gaming and Sportsbook and Casino
Sportsbook are legal Technology Provider End User
Games
Pennsylvania Colorado run on
Partner
Bragg’s
with
software
Leading Brands to Generate Traffic platform
Ontario Iowa
Branding Partner
Page 17North American Expansion Strategy – The Power of Brand Partnerships
IAC’s Barry Diller & Joey Levin letter to investors on $1b Goldman Sachs research note on Penn
investment in MGM Resorts International (Aug. 10, 2020) National Gaming (PENN) Aug 13, 2020
“MGM presented a "once in a decade" opportunity for IAC to own a meaningful piece of a David Portnoy's Barstool Sports could drive "rapid share gains"
preeminent brand in a large category with great potential to move online” for Penn National Gaming and help drive shares 20% higher from
Wednesday's close, according to Goldman Sachs.
“But that's not what originally drove us to MGM, nor in large part drove our final decision to
invest. We have a history and much experience in online commerce. So we began our analysis The research firm initiated Penn National at a buy with a 12-
with a focus on a small piece of MGM, a portion of its revenue so small that it rounds down to month price target of $60 on Thursday, arguing that Barstool's
zero: its online gaming revenue. ” massive social media following can help lower customer
acquisition costs for Penn National.
“so we found one of the leading players operating in 7 going on 11 states by the end of
2020: MGM, which pairs a strong physical presence and brand with talented online operators In January, Penn National bought a 36% equity stake in Barstool
in a fast-growing joint venture in online gaming.” Sports for US$163 million, and has the option to acquire another
14% stake in the economy via warrants three years after the deal
“we believe MGM also is an aspirational brand, which could be delivered with daily accessibility
and offer gaming consumers (including the 34 million M-life Rewards members) a wider range of
services, both physical and digital, than any competitor. And MGM, with its highly capable joint
venture partner GVC, has only just barely begun to deliver these products.”
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