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No Debt and a Lot of Money Sets Golden Matrix Group Inc. (NASDAQ: GMGI) Apart as It Sets Sights on ESports Too

  • GMGI a standout differentiated in Benzinga’s Listmakers Series: ESports
  • Golden Matrix will be launching a new P2P ESports betting platform
  • GMGI is eyeing new accretive acquisitions to extend its string of nearly 4 years of consecutive profitable quarters

Companies are usually willing to open their bank accounts for naming rights. For instance, FedEx is paying $7.5 million per year to have their name on the home field of the Washington Commanders. New tech brands are changing the game. In November 2021, Crypto.com agreed to pay $700 million to see the iconic Staples Center re-branded as Crypto.com Center for the next 20 years ($35 million/year). At the outset of Benzinga’s Listmakers Series: ESports, held June 22, 2022 featuring Golden Matrix Group (NASDAQ: GMGI), United Esports, and other heavy hitters in digital gaming, the event opened with a discussion on industry momentum that included cryptocurrency exchange FTX shelling out $210 million for the naming rights to esports organization TSM for the next 10 years.

That’s nearly three times as much FTX pays each year for naming rights to the home arena for the Miami Heat of the National Basketball Association. Welcome to the digital revolution and the emergence of electronic sports into North America.

Golden Matrix Group is differentiated from most companies involved in the conference insomuch that it is not an ESports team. Rather it is a leading provider of turnkey and white label gaming platforms, including Esports technology and gaming content. Golden Matrix built a name for itself with its business-to-business (“B2B”) platform, comprised of its GM-X system and the recently successful launched new GMX-Ag (aggregate) platform regarded as the industry standard, granting access to over 10,000 games from more than 25 game providers. The Las Vegas-based company is an expert in player loyalty, which allows operators to control churn and generate additional revenue from an existing player, rather than increasing expenses for new player acquisition.

As of the end of the second quarter, GMGI supports over 635 unique casino operations and over 6.5 registered million players.

Late in 2021, GMGI made its initial foray into the business-to-consumer (“B2C”) marketplace, with the acquisition of 80% of Ireland-based contest operator RKings. RKings owns and operates raffles for participants in Ireland and the United Kingdom. Contest prizes are frequently for big ticket items, such as automobiles, boats, exotic vacations, and more. In March, GMGI applied for a permit to operate the contests in Mexico, the next leg in international expansion for the RKings platform. 

With a bit of a chuckle during an interview with Benzinga’s Zunaid Suleman, Golden Matrix Group CEO Brian Goodman effectively said, “Let’s call it what it is; we’re a ‘gambling’ company, not a ‘gaming’ company.” In industry nomenclature, it is generally considered PC to not say “gambling,” even when talking about online casino games or betting on game outcomes. There are many reasons for that, including strict regulations on what is indeed a game of skill versus a game of chance and geolocation factors regarding where licenses are mandatory for operations.

Goodman has been a popular figure lately, also interviewed on the latest episode the Bell2Bell podcast.

There is growing choir of voices about the future of ESports gambling, but, as Goodman discusses with Suleman, there are a lot of nuances to keeping bets fair and an honest marketplace. For now, his company has built out a system for peer-to-peer (“P2P”) betting system along with some built-in games for ESports players that will be launching soon. P2P betting is legal throughout the U.S., although there are considerations for money transfers under the Wire Act that must be followed. P2P has been trumpeted for its massive potential to eliminate the “house” and creating wager unlimited wager scenarios so that bettors don’t feel like the deck is always stacked in the house’s favor.

That will be a solid addition to a company that has graduated from the OTC Pink Sheets to OTCQX Best Market to NASDAQ Capital Markets in about 9 months.  

While many companies languished through the COVID-19 pandemic, GMGI maintained its string of profitability, which has now been extended to 15 straight quarters. From beginning of this fiscal year, the company began realizing the benefits of the RKings acquisition, which further bolstered the top and bottom lines.

Revenue for the quarter ended April 30, 2022, was $8.48 million, up 221% from $2.64 million in the year prior quarter. Net income was $586,984, a gain of 359% from $127,986 in a same period a year earlier. Shareholders’ equity of GMGI of rose 37% year-over-year to $26 million from $18.93 million. The company has no debt and finished the quarter with cash and cash equivalents of $15.81 million.

“We’re rolling out some new operators every week…what we’ve told the market already is that the core business will continue to grow, but we will also acquire some accretive profitable businesses in a similar line to what we do,” said Goodman. He opined that he is hopeful the company will make some acquisitions in the coming months to scale the business.

“We’ve always returned value to shareholders, and we continue to grow every quarter. We don’t burn money. We’re a solid investment for people who want to get in and ride along with something that is growing,” Goodman added.

For more information, visit the company’s website at www.GoldenMatrix.com

NOTE TO INVESTORS: The latest news and updates relating to GMGI are available in the company’s newsroom at https://ibn.fm/GMGI

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