Quarterly report pursuant to Section 13 or 15(d)

19. Segmental Reporting

v3.22.2.2
19. Segmental Reporting
 9 Months Ended
Sep. 30, 2022
Segment Reporting [Abstract]  
19. Segmental Reporting

19. 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; and only web based distribution through our Austrian subsidiary in the Italian market until June 2021, and

 

(ii)       Betting platform software and services

 

Provider of certified betting Platform software services to global leisure betting establishments and operators.

 

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

 

Segment Reporting 

                                 
    September 30, 2022
    Betting establishments   Betting platform software and services   All other   Total
                 
Purchase of non-current assets   $ 214,805     $ 64,721     $ 76,413     $ 355,939  
Assets                                
Current assets     6,002,886       3,540,566       205,740       9,749,192  
Non-current assets     2,681,303       30,048,147       115,784       32,845,234  
Liabilities                                
Current liabilities     (5,904,785 )     (2,070,572 )     (1,245,773 )     (9,221,130 )
Non-current liabilities     (1,358,907 )     (17,819,917 )     —         (19,178,824 )
Intercompany balances     5,006,155       (3,887,691 )     (1,118,464 )     —    
Net asset position   $ 6,426,652     $ 9,810,533     $ (2,042,713 )   $ 14,194,472  

 

  

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

 

                                         
    Nine months ended September 30, 2022
    Betting establishments   Betting platform software and services   All other   Adjustments   Total
Revenue   $ 30,408,624     $ 1,766,391     $ —       $ —       $ 32,175,015  
Intercompany Service revenue     74,584       1,517,807       —         (1,592,391 )     —    
Total revenue     30,483,208       3,284,198       —         (1,592,391 )     32,175,015  
Operating expenses                                        
Intercompany service expense     1,517,807       74,584       —         (1,592,391 )     —    
Selling expenses     23,896,814       132,718       —         —         24,029,532  
General and administrative expenses     4,387,356       5,724,166       5,477,888       —         15,589,410  
Restructuring and Severance expenses     —         —         1,205,689       —         1,205,689  
Total operating expenses     29,801,977       5,931,468       6,683,577       (1,592,391 )     40,824,631  
                                         
Income (Loss) from operations     681,231       (2,647,270 )     (6,683,577 )     —         (8,649,616 )
                                         
Other income (expense)                                        
Other income     90,781       2       —         —         90,783  
Other expense     (47,959 )     (8,580 )     —         —         (56,539 )
Interest expense, net     (1,069 )     (21,572 )     —         —         (22,641 )
Change in fair value of contingent purchase consideration     —         (1,397,833 )     —         —         (1,397,833 )
Gain on marketable securities     —         —         43,250       —         43,250  
Total other income (expense)     41,753       (1,427,983 )     43,250       —         (1,342,980 )
                                         
Income (Loss) before Income Taxes     722,984       (4,075,253 )     (6,640,327 )     —         (9,992,596 )
Income tax provision     (437,042 )     236,524       —         —         (200,518 )
Net Income (Loss)   $ 285,942     $ (3,838,729 )   $ (6,640,327 )   $ —       $ (10,193,114 )

   

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

 

                                 
    September 30, 2021
    Betting establishments   Betting platform software and services   All other   Total
                 
Purchase of non-current assets   $ 25,502     $ 37,881,164     $ 43,552     $ 37,950,218  
Assets                                
Current assets     8,587,092       1,308,003       2,230,792       12,125,887  
Non-current assets     6,783,911       43,666,430       1,156,085       51,606,426  
Liabilities                                
Current liabilities     (6,499,182 )     (915,762 )     (1,225,532 )     (8,640,476 )
Non-current liabilities     (765,779 )     (3,618,200 )     (25,286,034 )     (29,670,013 )
Intercompany balances     4,247,985       (705,171 )     (3,542,814 )     —    
Net asset position   $ 12,354,027     $ 39,735,300     $ (26,667,503 )   $ 25,421,824  

 

 

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

  

                                         
    Nine months ended September 30, 2021
    Betting establishments   Betting platform software and services   All other   Adjustments   Total
Revenue   $ 33,448,435     $ 428,924     $ —       $ —       $ 33,877,359  
Intercompany Service revenue     271,518       3,323,848       —         (3,595,366 )     —    
Total revenue     33,719,953       3,752,772       —         (3,595,366 )     33,877,359  
Operating expenses                                        
Intercompany service expense     3,323,848       271,518       —         (3,595,366 )     —    
Selling expenses     26,318,643       14,513       —         —         26,333,156  
General and administrative expenses     5,251,863       4,204,834       4,518,758       —         13,975,455  
Total operating expenses     34,894,354       4,490,865       4,518,758       (3,595,366 )     40,308,611  
                                         
Loss from operations     (1,174,401 )     (738,093 )     (4,518,758 )     —         (6,431,252 )
                                         
Other income (expense)                                        
Other income     434,624       2,073       7,992       —         444,689  
Other expense     (23,954 )     (4,568 )     —         —         (28,522 )
Interest expense, net     (7,486 )     (2,109 )     (5,153 )     —         (14,748 )
Change in fair value of contingent purchase consideration     —         —         (569,076 )     —         (569,076 )
Amortization of present value discount     —         —         (12,833 )     —         (12,833 )
Loss on marketable securities     —         —         (292,500 )     —         (292,500 )
Total other income (expense)     403,184       (4,604 )     (871,570 )     —         (472,990 )
                                         
Loss before Income Taxes     (771,217 )     (742,697 )     (5,390,328 )     —         (6,904,242 )
Income tax provision     (50,666 )     58,802       —         —         8,136  
Net Loss   $ (821,883 )   $ (683,895 )   $ (5,390,328 )   $ —       $ (6,896,106 )