Gaming Realms PLC (LSE:GMR, OTCQX:PSDMF) posted a solid set of half-year results on Monday, with revenue up 18% and adjusted earnings before interest, tax, depreciation and amortisation rising 30%, both in line with expectations.
Net cash jumped by £5.5m to £19m, and Peel Hunt now sees that figure rising further to £22.5m by the end of the year.
The update shows a business weathering regulatory disruption in its core UK market, while continuing to grow internationally.
The introduction of a £5 stake limit in April clipped the wings of Slingo, Gaming Realms’ flagship game, which had previously relied on escalating stakes through repeat spins.
But the company appears to have anticipated the change well, developing a workaround in the form of the “SuperSpin Wheel.”
Instead of offering players an £8 follow-up stake, which is now banned, SuperSpin allows them to pay, say, £4 for the chance to win additional spins. It is a clever mechanic, and more importantly, it seems to be working.
While UK licensing revenues were still down 13% in the first half and 21% in the second quarter, August showed a much-improved 9% decline.
With 48 SuperSpin games live by the end of last month and more to follow, revenue recovery is progressing faster than expected.
Outside the UK, growth remains robust. Excluding the UK, content licensing revenue rose 18% year-on-year in the first half, underlining the company’s traction in the US and other international markets.
Operating forecasts remain unchanged, though Peel Hunt has cut its full-year earnings per share estimate by 23% to reflect higher tax assumptions.
The broker is undeterred and reiterated its 'buy' rating and 75p price target, pointing to strong cash generation, well-prepared product development and a licensing pipeline that is already delivering results.
With regulatory uncertainty being managed and international growth intact, Gaming Realms looks to be back on track.