Bragg Gaming Group Inc 6-K, filed Aug 10, 2023

Bragg Gaming Group Inc. (BRAG)

6-K 2023-08-10 For: 2023-08-10

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Added on April 06, 2026

About this 6-K

Bragg Gaming Group Inc filed this 6-K on August 10, 2023.

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Exhibit		Description

99.1		Bragg Gaming Group Inc. - Interim unaudited condensed consolidated Financial Statements – Three and six-month period ended June 30, 2023
99.2		Management discussion & analysis for the three and six-month period ended June 30, 2023
99.3		Certification of Interim Filings - CEO
99.4		Certification of Interim Filings - CFO
99.5		News release, dated August 10, 2023


	BRAGG GAMING GROUP INC.

Date: August 10, 2023
	By:	/s/ Yaniv Spielberg
	Name:	Yaniv Spielberg
	Title:	Chief Strategy Officer


INTERIM UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS) AND COMPREHENSIVE (LOSS) INCOME		1
INTERIM UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION		2
INTERIM UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY		3
INTERIM UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS		4

NOTES TO THE INTERIM UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1	GENERAL INFORMATION	5
2	SIGNIFICANT ACCOUNTING POLICIES	5
3	PROFIT BEFORE INCOME TAXES CLASSIFIED BY NATURE	6
4	ACQUISITION OF SPIN GAMES LLC	7
5	CONVERTIBLE DEBT	8
6	SHARE CAPITAL	11
7	WARRANTS	12
8	SHARE BASED COMPENSATION	13
9	GOODWILL	16
10	DEFERRED CONSIDERATION	17
11	INTANGIBLE ASSETS	18
12	CASH AND CASH EQUIVALENTS	18
13	TRADE AND OTHER RECEIVABLES	19
14	PREPAID EXPENSES AND OTHER ASSETS	20
15	TRADE PAYABLES AND OTHER LIABILITIES	20
16	RELATED PARTY TRANSACTIONS	20
17	FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT	23
18	SUPPLEMENTARY CASHFLOW INFORMATION	26
19	SEGMENT INFORMATION	26
20	INCOME TAXES	27
21	CONTINGENT LIABILITIES	28
22	SUBSEQUENT EVENTS	28


		Three Months Ended June 30,		Six Months Ended June 30,
	Note	2023	2022	2023	2022
Revenue	3, 19	24,729	20,794	47,588	40,154
Cost of revenue		(10,903)	(9,167)	(21,542)	(18,507)
Gross Profit		13,826	11,627	26,046	21,647

Selling, general and administrative expenses	3	(13,082)	(11,305)	(24,988)	(21,505)
Loss on remeasurement of derivative liability	5	(115)	—	(179)	—
Gain on settlement of convertible debt	5	204	—	204
Gain on remeasurement of consideration receivable	3	—	—	—	37
Gain on remeasurement of deferred consideration	4, 10	438	469	708	469
Operating Income		1,271	791	1,791	648

Net interest expense and other financing charges	3	(368)	(126)	(964)	(278)
Profit Before Income Taxes	3	903	665	827	370

Income taxes	20	(526)	(575)	(926)	(1,000)
Net Income (Loss)		377	90	(99)	(630)

Items to be reclassified to net income (loss):
Cumulative translation adjustment		(585)	1,601	(1,143)	2,185

Net Comprehensive (Loss) Income		(208)	1,691	(1,242)	1,555

Basic Income (Loss) Per Share		0.02	0.00	(0.00)	(0.03)
Diluted Income (Loss) Per Share		0.02	0.00	(0.00)	(0.03)

		Millions	Millions	Millions	Millions
Weighted average number of shares - basic		22.3	21.0	22.0	20.9
Weighted average number of shares - diluted		23.6	21.8	23.3	20.9


		As at	As at
		June 30,	December 31,
	Note	2023	2022
Cash and cash equivalents	12	10,742	11,287
Trade and other receivables	13	16,515	16,628
Prepaid expenses and other assets	14	3,387	1,823
Total Current Assets		30,644	29,738
Property and equipment		692	660
Right-of-use assets		1,242	576
Intangible assets	11	39,520	41,705
Goodwill	4, 9	31,662	31,662
Other assets		47	47
Total Assets		103,807	104,388

Trade payables and other liabilities	15	19,337	19,549
Deferred revenue		408	746
Income taxes payable	20	1,229	1,113
Lease obligations on right of use assets - current		342	294
Deferred consideration - current	4, 10	899	1,176
Derivative liability - current	5	1,006	1,320
Loans payable		—	109
Total Current Liabilities		23,221	24,307
Deferred income tax liabilities	20	1,201	1,201
Lease obligations on right of use assets - non-current		973	344
Convertible debt	5	4,532	6,648
Deferred consideration - non-current	4, 10	836	2,121
Other non-current liabilities		233	233
Total Liabilities		30,996	34,854

Share capital	6	117,061	109,902
Broker warrants	7	38	38
Shares to be issued		3,491	6,982
Contributed surplus		21,596	20,745
Accumulated deficit		(72,326)	(72,227)
Accumulated other comprehensive income		2,951	4,094
Total Equity		72,811	69,534
Total Liabilities and Equity		103,807	104,388


Yaniv Sherman	Holly Gagnon
Chief Executive Officer	Non Executive Director


												Accumulated
												other
		Share		Shares to		Broker		Contributed		Accumulated		comprehensive		Total
	Note	capital		be issued		warrants		surplus		Deficit		income (loss)		Equity
Balance as at January 1, 2022			100,285		13,746		38		18,385		(68,743)		2,484		66,195
Shares issued as consideration	6		1,426		—		—		—		—		—		1,426
Shares issued as deferred consideration	6		6,764		(6,764)		—		—		—		—		—
Exercise of deferred share units	6, 8		1,407		—		—		(1,407)		—		—		—
Exercise of stock options	6, 8		15		—		—		(5)		—		—		10
Share-based compensation	8		—		—		—		2,097		—		—		2,097
Net loss for the period			—		—		—		—		(630)		—		(630)
Other comprehensive income			—		—		—		—		—		2,185		2,185
Balance as at June 30, 2022			109,897		6,982		38		19,070		(69,373)		4,669		71,283

Balance as at January 1, 2023			109,902		6,982		38		20,745		(72,227)		4,094		69,534
Shares issued upon exercise of convertible debt	5, 6		2,127		—		—		—		—		—		2,127
Shares issued as deferred consideration	6, 10		4,595		(3,491)		—		—		—		—		1,104
Exercise of restricted share units	6, 8		213		—		—		(213)		—		—		—
Exercise of deferred share units	6, 8		218		—		—		(218)		—		—		—
Exercise of stock options	6, 8		6		—		—		(2)		—		—		4
Share-based compensation	8		—		—		—		1,284		—		—		1,284
Net income for the period			—		—		—		—		(99)		—		(99)
Other comprehensive loss			—		—		—		—		—		(1,143)		(1,143)
Balance as at June 30, 2023			117,061		3,491		38		21,596		(72,326)		2,951		72,811


		Balances
Purchase price:
Prepaid consideration		2,138
Cash paid upon business combination		8,488
Shares		1,426
Deferred consideration		4,003
Total purchase price		16,055

Fair value of assets acquired, and liabilities assumed:
Cash and cash equivalents		266
Trade and other receivables		405
Prepaid expenses and other assets		105
Property and equipment		107
Right-of-use assets		177
Trade payables and other liabilities		(923)
Deferred revenue		(364)
Lease obligations on right of use assets - current		(88)
Loans payable		(773)
Lease obligations on right of use assets - noncurrent		(89)
Net assets acquired and liabilities assumed		(1,177)

Fair value of intangible assets:
Intellectual property		1,471
Customer relationships		8,131
Gaming licences		164
Brand		462
Trademarks		70
Goodwill		6,934


	Convertible debt	Derivative liability	Total
Balance at issuance - September 5, 2022	7,287	1,483	8,770
Issuance costs	(596)	—	(596)
Accretion expense	448	—	448
Gain on remeasurement of derivative liability	—	(13)	(13)
Effect of movement in exchange rates	(491)	(150)	(641)
Balance as at December 31, 2022	6,648	1,320	7,968

Accretion expense	704	—	704
Loss on remeasurement of derivative liability	—	179	179
Gain on settlement of convertible debt	—	(204)	(204)
Shares issued upon exercise of convertible debt	(1,841)	(286)	(2,127)
Repayment of convertible debt	(939)	—	(939)
Effect of movement in exchange rates	(40)	(3)	(43)
Balance as at June 30, 2023	4,532	1,006	5,538


		Note	Number	Value
January 1, 2022	Balance		19,956,034	100,285
March 17, 2022, to June 22, 2022	Issuance of share capital upon exercise of FSOs	8	5,900	15
March 22, 2022	Issuance of share capital upon exercise of DSUs	8	97,045	1,407
June 1, 2022	Shares issued on completion of private placement		285,135	1,426
June 16, 2022	Shares issued upon completion of Oryx earn-out		761,754	6,764
June 30, 2022	Balance		21,105,868	109,897

January 1, 2023	Balance		21,107,968	109,902
January 10, 2023 to May 23, 2023	Issuance of share capital upon exercise of FSOs	8	2,450	6
April 6, 2023	Issuance of share capital upon exercise of DSUs	8	38,334	218
April 6, 2023	Issuance of share capital upon exercise of RSUs	8	40,000	213
January 13, 2023 to May 4, 2023	Shares issued upon exercise of Convertible Debt	5	617,357	2,127
June 1, 2023	Shares issued upon settlement of deferred consideration for Spin acquisition	4	357,739	1,104
June 8, 2023	Shares issued upon settlement of deferred consideration for Wild Streak acquisition		393,111	3,491
June 30, 2023	Balance		22,556,959	117,061


		Warrants
		issued as part of	Broker
Number of Warrants		convertible debt	warrants

January 1, 2022 and June 30, 2022	Balance	—	16,686

January 1, 2023 and June 30, 2023	Balance	979,048	16,886


	DSU	RSU	FSO
				Weighted
	Outstanding	Outstanding	Outstanding	Average
	DSU Units	RSU Units	FSO Options	Exercise
	(Number of	(Number of	(Number	Price / Share
	of shares)	of shares)	of shares)	CAD
Balance as at January 1, 2022	246,945	235,000	1,816,302	8.95
Granted	125,000	80,000	273,000	8.62
Exercised	(97,045)	—	(5,900)	2.30
Forfeited / Cancelled	—	—	(142,466)	14.78
Balance as at June 30, 2022	274,900	315,000	1,940,936	8.50

Balance as at January 1, 2023	274,900	738,000	2,118,395	8.23
Granted	—	187,500	25,000	8.08
Exercised	(38,334)	(40,000)	(2,450)	2.30
Forfeited / Cancelled	—	—	(62,628)	9.45
Balance as at June 30, 2023	236,566	885,500	2,078,317	8.20


	Outstanding			Exercisable
		Weighted	Weighted		Weighted
		Average	Average		Average
	Options	Remaining	Exercise	Options	Exercise
Range of exercise	(Number	Contractual	Price / Share	(Number	Price / Share
prices (CAD)	of shares)	Life (Years)	CAD	of shares)	CAD

2.30 - 5.00	240,400	1	3.07	240,400	3.07
5.01 - 5.60	200,000	1	5.60	200,000	5.60
5.61 - 8.62	1,112,471	5	7.80	872,267	7.91
8.63 - 33.30	525,446	7	12.39	352,524	12.60
	2,078,317	4	8.20	1,665,191	7.93


		2023
Expected dividend yield (%)		0.0
Expected share price volatility (%)		64.3
Risk-free interest rate (%)		2.9
Expected life of options (years)		5.0
Share price (CAD)		7.56
Forfeiture rate (%)		0.0


		Three Months Ended June 30,		Six Months Ended June 30,
	Note	2023	2022	2023	2022
Revenue		24,729	20,794	47,588	40,154
Cost of revenue		(10,903)	(9,167)	(21,542)	(18,507)
Gross Profit		13,826	11,627	26,046	21,647

Salaries and subcontractors		(6,213)	(4,975)	(11,716)	(8,955)
Share based compensation	8	(526)	(797)	(1,284)	(2,097)
Total employee costs		(6,739)	(5,772)	(13,000)	(11,052)
Depreciation and amortization		(3,254)	(1,883)	(5,963)	(3,459)
IT and hosting		(1,060)	(610)	(2,037)	(1,058)
Professional fees		(657)	(895)	(1,286)	(1,748)
Corporate costs		(132)	(262)	(276)	(769)
Sales and marketing		(468)	(607)	(881)	(1,270)
Bad debt expense	13	127	(313)	88	(417)
Travel and entertainment		(203)	(184)	(392)	(265)
Transaction and acquisition costs		—	(146)	(32)	(346)
Other operational costs		(696)	(633)	(1,209)	(1,121)
Selling, General and Administrative Expenses		(13,082)	(11,305)	(24,988)	(21,505)

Loss on remeasurement of derivative liability	5	(115)	—	(179)	—
Gain on settlement of convertible debt	5	204	—	204	—
Gain on remeasurement of consideration receivable		—	—	—	37
Gain on remeasurement of deferred consideration	4, 10	438	469	708	469
Operating Income		1,271	791	1,791	648

Interest income		—	4	—	9
Accretion on liabilities	4, 10	(456)	(34)	(962)	(34)
Foreign exchange gain (loss)		150	(39)	131	(124)
Interest and financing fees		(62)	(57)	(133)	(129)
Net Interest Expense and Other Financing Charges		(368)	(126)	(964)	(278)
Profit Before Income Taxes		903	665	827	370


		Deferred
	Intellectual	Development	Customer
	Property	Costs	Relationships	Brands	Other	Total
Cost
Balance as at December 31, 2021	15,223	6,186	16,584	1,692	64	39,749
Additions	659	6,709	—	—	9	7,377
Acquired through business combination (Note 4)	1,471	—	8,131	462	234	10,298
Effect of movement in exchange rates	369	(14)	758	23	2	1,138
Balance as at December 31, 2022	17,722	12,881	25,473	2,177	309	58,562
Additions	—	3,709	—	—	—	3,709
Effect of movement in exchange rates	(132)	185	(379)	(15)	(6)	(347)
Balance as at June 30, 2023	17,590	16,775	25,094	2,162	303	61,924

Accumulated Amortization
Balance as at December 31, 2021	3,890	2,411	2,166	431	6	8,904
Amortization	2,238	3,161	2,186	350	46	7,981
Effect of movement in exchange rates	(17)	(4)	(2)	(2)	(3)	(28)
Balance as at December 31, 2022	6,111	5,568	4,350	779	49	16,857
Amortization	1,188	2,467	1,620	332	21	5,628
Effect of movement in exchange rates	(33)	(56)	(49)	(5)	62	(81)
Balance as at June 30, 2023	7,266	7,979	5,921	1,106	132	22,404

Carrying Amount

Balance as at December 31, 2022	11,611	7,313	21,123	1,398	260	41,705
Balance as at June 30, 2023	10,324	8,796	19,173	1,056	171	39,520


	As at	As at
	June 30,	December 31,
	2023	2022
Less than one month	16,872	15,759
Between two and three months	509	1,313
Greater than three months	1,414	1,594
	18,795	18,666
Provision for expected credit losses	(2,347)	(2,435)
Trade receivables	16,448	16,231


As at January 1, 2022		24,728
Goodwill recognized upon acquisition of Spin Games LLC (Note 4)		6,934
As at December 31, 2022 and June 30, 2023		31,662


Balance as at January 1, 2022		—
Deferred consideration payable upon business combination (Note 4)		4,003
Accretion expense		316
Gain on remeasurement of deferred consideration		(804)
Effect of movement in exchange rates		(218)
Balance as at December 31, 2022		3,297

Accretion expense		258
Gain on remeasurement of deferred consideration		(708)
Shares issued as deferred consideration		(1,104)
Effect of movement in exchange rates		(8)
Balance as at June 30, 2023		1,735


Balance as at December 31, 2021				2,415
Net additional provision for doubtful debts				(629)
Provision for late interest receivable				649
Balance as at December 31, 2022				2,435
Net additional provision for doubtful debts				(88)
Balance as at June 30, 2023				2,347


	Financial assets as subsequently
	measured at amortized cost
	June 30,	December 31,
	2023	2022
Trade receivables	16,448	16,231


	Financial liabilities as subsequently
	measured at amortized cost
	June 30,	December 31,
	2023	2022
Trade payables	5,482	4,327
Accrued liabilities	13,645	14,817
Convertible debt	4,532	6,648
Loans payable	—	109
Other liabilities	210	405
Lease obligations on right of use assets	1,315	638
	25,184	26,944


	June 30, 2023				December 31, 2022
	Level 1	Level 2	Level 3	Total	Level 1	Level 2	Level 3	Total
Financial assets
Fair value through profit and loss:
Cash and cash equivalents	10,742	—	—	10,742	11,287	—	—	11,287

Financial liabilities
Fair value through profit and loss:
Derivative liability	—	1,006	—	1,006	—	1,320	—	1,320
Deferred consideration	—	1,735	—	1,735	—	3,297	—	3,297
Other liabilities	—	—	74	74	—	—	74	74

Fair value through other comprehensive income:
Other liabilities	—	—	160	160	—	—	160	160


	2023	2024	2025	2026	Thereafter	Total
Trade payables and other liabilities	19,337	—	—	—	—	19,337
Lease obligations on right of use assets	349	358	335	187	259	1,488
Convertible debt	—	6,442	—	—	—	6,442
Other non-current liabilities	—	2	2	4	575	583
	19,686	6,802	337	191	834	27,850


		Aging (months)
	Note	<1	1 - 3	>3	Total
Gross trade receivable	13	16,872	509	1,414	18,795
Expected loss rate		7.55%	13.75%	70.91%	12.49%
Expected loss provision	13	1,275	70	1,002	2,347


	Six Months Ended June 30,
Cash flows arising from movement in:	2023	2022
Trade and other receivables	(237)	(1,623)
Prepaid expenses and other assets	(1,563)	(546)
Deferred revenue	(330)	679
Trade payables and other liabilities	(208)	4,216
Other liabilities - non-current	—	11
Changes in non-cash working capital	(2,338)	2,737


1.	MANAGEMENT DISCUSSION & ANALYSIS	2
2.	CAUTION REGARDING FORWARD-LOOKING STATEMENTS	3
3.	LIMITATIONS OF KEY METRICS AND OTHER DATA	3
4.	OVERVIEW OF 2Q23	4
5.	FINANCIAL RESULTS	11
5.1	Basis of financial discussion		11
5.2	Selected interim information		11
5.3	Other financial information		12
5.4	Selected financial information		13
5.5	Summary of quarterly results		14
5.6	Liquidity and capital resources		14
5.7	Cash flow summary		15
6	TRANSACTIONS BETWEEN RELATED PARTIES	16
7	DISCLOSURE OF OUTSTANDING SHARE DATA	18
8	CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS	18
9	CHANGES IN ACCOUNTING POLICY	21
10	MANAGEMENT’S RESPONSIBILITY FOR FINANCIAL REPORTING	21
11	RISK FACTORS AND UNCERTAINTIES	21
12	ADDITIONAL INFORMATION	28


	Three Months Ended	Three Months Ended	Six Months Ended	Six Months Ended
	June 30,	June 30,	June 30,	June 30,
EUR 000	2023	2022	2023	2022
Revenue	24,729	20,794	47,588	40,154
Net income (loss)	377	90	(99)	(630)
EBITDA	4,525	2,674	7,754	4,107
Adjusted EBITDA	4,742	3,135	8,636	6,175

Basic earnings (loss) per share	0.02	0.00	(0.00)	(0.03)
Diluted earnings (loss) per share	(0.39)	(1.69)	(0.00)	(0.03)


	2021		2022				2023
EUR 000	3Q21	4Q21	1Q22	2Q22	3Q22	4Q22	1Q23	2Q23
Revenue	12,874	15,758	19,360	20,794	20,899	23,681	22,859	24,729
Operating income (loss)	(2,217)	(1,841)	(143)	791	(1,638)	162	520	1,271
EBITDA	(884)	(264)	1,433	2,674	837	2,682	3,229	4,525
Adjusted EBITDA	1,476	1,599	3,040	3,135	2,237	3,650	3,894	4,742
Income (Loss) per share - Basic	(0.12)	(0.08)	(0.03)	0.00	(0.09)	(0.04)	(0.02)	0.02
Income (Loss) per share - Diluted	(0.12)	(0.08)	(0.03)	0.00	(0.09)	(0.04)	(0.02)	0.02


	June 30,	August 10,
	2023	2023
Common Shares	22,556,959	22,556,959
Warrants	979,048	979,048
Broker Warrants	16,886	16,886
Fixed Stock Options	2,078,317	2,078,317
Restricted Share Units	885,500	885,500
Deferred Share Units	236,566	236,566
	26,753,276	26,753,276

Date:	August 10, 2023

/s/ Yaniv Sherman
Yaniv Sherman
Chief Executive Officer


Euros (millions)⁽¹⁾	2Q23			2Q22			Change
Revenue	€	24.7		€	20.8		18.9	%
Gross profit	€	13.8		€	11.6		18.9	%
Gross profit margin		55.9	%		55.9	%	0	bps
Adjusted EBITDA⁽²⁾	€	4.7		€	3.1		51.3	%
Adjusted EBITDA margin		19.2	%		15.1	%	410	bps
Wagering revenue	€	5.5	B	€	4.2	B	31.2	%