Gaming CEO Brian Goodman (NASDAQ: GMGI) Shares How His Company Grew Profits Even During COVID

The COVID-19 pandemic adversely impacted the entire global economy. After collective international efforts that saw the world open up following vaccine rollouts, the global economy gradually started picking up.

But just when most businesses were beginning to pick up the pieces from the pandemic, the Russian-Ukraine war worsened the global economy’s woes even further.

Like most industries, the gambling and gaming sector has faced its share of obstacles during these challenging financial times. At the outbreak’s peak, casinos, gambling businesses such as taverns, breweries, bingo halls and others were forced to close.

The closures put online gambling in the spotlight as more and more gamblers directed their bets towards more accessible options.

But even with a post-COVID recovery putting a positive outlook on the global gaming sector, there are indications that the gaming industry — which includes companies like Light & Wonder Inc. LNW, Boyd Gaming Corp. BYD and Churchill Downs Inc. CHDN — could still face some growth challenges.

Diamond In The Rough?

Another player, Golden Matrix Group Inc. GMGI, believes it is a diamond in the rough.

Golden Matrix develops and licenses online gaming platforms and systems. Specifically, it pioneers highly modular, configurable and scalable gaming platforms for its international customers to promote user acquisition, engagement, retention and monetization.

Even amidst the global economic downturn, the company continues to report impressive revenue growth year-on-year. Golden Matrix CEO Brian Goodman told Benzinga in an exclusive interview that these continuous successes didn’t come by chance.

“We are unusual as a gambling company in that we are highly profitable, and we generate positive cash,” Goodman said. “I mean, a lot of these online gambling companies lose hundreds of millions, billions of dollars and continue to burn money.”

Recession And Growth Of Online Gambling

Goodman observed that while a recession could impact many businesses, sin stocks like gambling, tobacco, marijuana and alcohol most often perform well. He said he does not anticipate any negative impact on the gambling or gaming sector.

Using the U.S. as an example, Goodman explained that as more states take steps to provide some legislative framework to regulate the gaming industry, it could present tremendous 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. “If companies don’t have an online presence, then obviously they can’t compete in today’s world.”

This realization has seen land-based operators take their businesses online, especially following the impact of COVID-19 on the industry. 

“There’s a huge push to have a component of your business be online, and that obviously fuels the online gambling market.”

Expansion Into New Markets

Golden Matrix runs a pay-to-enter prize competition in the U.K. and Ireland. The company says the raffle ticket business, which it acquired about a year ago, has performed exceptionally well.

The tech CEO revealed that what makes the raffle ticket business unique is that when people win the high-value prizes they put up, the winners sometimes have the option to choose money instead of the prize they won.

Another valuable component of the raffle ticket business, he added, is that the company is able to buy customers at a lower rate. 

“If acquisition costs should be around $3 per person, most gambling companies in the U.S. are spending around $500 or $600 per player,” he said.

Golden Matrix has plans to take the raffle ticket business to new markets, but there are challenges. Apart from regulatory hurdles, which are sometimes easily surmounted, there is the issue of language barriers.

Nevertheless, Goodman says the company is making headway. 

“We are about to launch our online casino into Mexico utilizing a gaming permit that has been granted to the company, and we are looking to expand into other LATAM markets, beginning with Brazil,” he said. “We have assembled a skillful Spanish and Portuguese team, and we are confident that these highly scalable and logical extensions of our business will be well-received by gaming participants in these new markets and make meaningful contributions to GMGI’s overall revenues and profits.”

Profitability And Revenue Growth

Golden Matrix reports that it is on track this year to increase revenue by over 250%, with profitability at around 50% according to Goodman.

“We are hopeful that we will continue to deliver these results. The company has a large amount of cash on its balance sheet. It has a very strong balance sheet,” Goodman said.

The company also seeks to acquire other creative businesses that can add value to its operations.

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Featured photo by Marko Aliaksandr on Shutterstock