Annual report pursuant to Section 13 and 15(d)

Segmental Reporting

v3.21.1
Segmental Reporting
12 Months Ended
Dec. 31, 2020
Segment Reporting [Abstract]  
Segmental Reporting

22. Segmental Reporting

 

The Company has two reportable operating segments. These segments are:

 

(i) Betting establishments

 

The operating of web based as well as land-based leisure betting establishments situated throughout Italy

 

(ii) Betting platform software and services

 

Provider of certified betting Platform software services to leisure betting establishments in Italy and 11 other countries.

 

The operating assets and liabilities of the reportable segments are as follows:

 

    December 31, 2020
    Betting establishments   Betting platform software and services   All other   Total
                 
Purchase of Non-Current assets   $ 172,095     $ 117,703     $ 1,703     $ 291,501  
Assets                                
Current assets     10,966,901       430,625       9,796,140       21,193,666  
Non-Current assets     7,475,455       6,250,418       938,440       14,664,313  
Liabilities                                
Current liabilities     (8,238,101 )     (648,881 )     (4,427,053 )     (13,314,035 )
Non-Current liabilities     (1,130,752 )     (1,225,477 )     (31,362 )     (2,387,591 )
Intercompany balances     4,259,281       382,598       (4,641,879 )     —    
Net asset position   $ 13,332,784     $ 5,189,283     $ 1,634,286     $ 20,156,353  

   

The segment operating results of the reportable segments are disclosed as follows:

 

    Year ended December 31, 2020
    Betting establishments   Betting platform software and services   All other   Adjustments   Total
                     
Net Gaming Revenue   $ 37,121,603     $ 144,764     $ —       $ —       $ 37,266,367  
Intercompany Service revenue     84,172       3,604,523       —         (3,688,695 )     —    
      37,205,775       3,749,287       —         (3,688,695 )     37,266,367  
Operating expenses                                        
Intercompany service expense     3,604,523       84,172       —         (3,688,695 )     —    
Selling expenses     26,107,189       2,032       —         —         26,109,221  
General and administrative expenses     4,918,986       3,906,439       4,963,966       —         13,789,391  
Impairment of license     4,900,000       —         —         —         4,900,000  
      39,530,698       3,992,643       4,963,966       (3,688,695 )     44,798,612  
                                         
Loss from operations     (2,324,923 )     (243,356 )     (4,963,966 )     —         (7,532,245 )
                                         
Other (expense) income                                        
Interest expense, net     (6,492 )     (71 )     (322,100 )     —         (328,663
Amortization of debt discount     —         —         (818,182 )     —         (818,182 )
Other income     161,472       3,903       —         —         165,375  
Other expense     (28,757 )     (58,176 )     —         —         (86,933 )
Loss on extinguishment of convertible debt     —         —         (719,390 )     —         (719,390 )
Gain on marketable securities     —         —         290,000       —         290,000  
Total other (expenses) income     126,223       (54,344 )     (1,569,672 )     —       1,497,793 )
                                         
Loss before Income Taxes     (2,198,700 )     (297,700 )     (6,533,638 )     —         (9,030,038 )
Income tax provision     (796,991 )     52,459       (162,112 )     —         (906,644 )
Net Loss   $ (2,995,691 )   $ (245,241 )   $ (6,695,750 )   $ —       $ (9,936,682 )

 

  

The operating assets and liabilities of the reportable segments are as follows:

 

    December 31, 2019
    Betting establishments   Betting platform software and services   All other   Total
                 
Purchase of Non-Current assets   $ 202,042     $ 5,456,358     $ —       $ 5,658,400  
Assets                                
Current assets     6,620,800       470,127       216,948       7,307,875  
Non-Current assets     12,761,177       6,615,905       1,183,550       20,560,632  
Liabilities                                
Current liabilities     (5,395,212 )     (615,564 )     (10,450,390 )     (16,461,166 )
Non-Current liabilities     (1,266,145 )     (1,339,911 )     —         (2,696,056 )
Intercompany balances     5,461,766       423,926       (5,885,692 )     —    
Net asset position   $ 18,182,386     $ 5,554,483     $ (14,935,584 )   $ 8,801,285  

 

The segment operating results of the reportable segments are disclosed as follows:

 

    Year ended December 31, 2019
     
    Betting establishments   Betting platform software and services   All other   Adjustments   Total
                     
Net Gaming Revenue   $ 35,209,477     $ 373,654     $ —       $ —       $ 35,583,131  
Intercompany Service revenue     452,776       2,839,211       —         (3,291,987 )     —    
      35,662,253       3,212,865       —         (3,291,987 )     35,583,131  
Operating expenses                                        
Intercompany service expense     2,839,211       452,776       —         (3,291,987 )     —    
Selling expenses     25,583,913       2,000,579       —         —         27,584,492  
General and administrative expenses     5,109,135       1,294,617       4,590,802       —         10,994,554  
      33,532,259       3,747,972       4,590,802       (3,291,987 )     38,579,046  
                                         
(Loss) income from operations     2,129,994       (535,107 )     (4,590,802 )     —         (2,995,915 )
                                         
Other (expense) income                                        
Interest expense, net     (190,206 )     3       (782,240 )     —         (972,443 )
Amortization of debt discount     —         —         (4,154,922 )     —         (4,154,922 )
Virtual Generation earnout     —         —         (561,351 )     —         (561,351 )
Loss on share issuances     —         —         (44,063 )     —         (44,063 )
Other income     114,818       —         34,747       —         149,565  
Loss on marketable securities     —         —         (97,500 )     —         (97,500 )
Total other (expenses) income     (75,388 )     3       (5,605,329 )     —         (5,680,714 )
                                         
Loss before Income Taxes     2,054,606       (535,104 )     (10,196,131 )     —         (8,676,629 )
Income tax provision     (641,528 )     (43,352 )     —         —         (598,176 )
Net Loss   $ 1,413,078     $ (491,752 )   $ (10,196,131 )   $ —       $ (9,274,802 )