Luckbox cuts losses by 73.2% in 2020 as costs fall

Revenue increased almost 18 times over to $75,500 (£44,200/€51,000/$61,300). All of the business’ revenue was made through its operations based in the Isle of Man. 

Real Luck Group chief executive Quentin Martin said the business’ low revenue was due to the fact that it was still primarily focused on developing its platform rather than taking a large volume of bets.

“Our focus throughout fiscal 2020 was on developing our proprietary esports betting platform and, despite nominal marketing spend, we were able to organically and efficiently increase our audience as the global pandemic brought esports betting into focus during early 2020,” Martin said.

“However, the calendar of esports events was adversely impacted, particularly in the second half, due to the postponement of the biggest esports event of the year – the Dota 2 International.”

The business then had costs of sales totalling $288,900, up 255.6%. This meant Luckbox made a gross loss of $212,500.

Luckbox then paid $5.2m in operating expenses, which was 73.2% less than in 2019, thanks mostly to reduced share-based compensation. 

Salaries and director fees were the largest expense at $1.5m, followed by legal and professional fees of $907,100, share-based compensation of $887,600 and $521,400 in general and administrative costs.

This led to an operating loss of $5.4m. Other income and expenses, including a gain on convertible options and expenses related to listing on the TSX Venture Exchange in Toronto, largely canceled eachother out, resulting in a net pre-tax loss of $5.5m, down 73.3%.

After tax and currency adjustments, Luckbox’s net loss was down 73.2% and remained at $5.5m.

“Fiscal 2020 was an important year for our young company as we achieved several important milestones, including our oversubscribed equity financing and public listing on the TSX Venture Exchange,” Martin said. 

“This year’s esports calendar looks much better, and our strong balance sheet positions us for healthy growth in 2021 and 2022. As we continue to grow our team, enhance our product and spread the word about Luckbox with a comprehensive marketing strategy in place, we look forward to offering our customers the opportunity to wager on several highly anticipated events.” 

After the end of the year, Luckbox announced that it would be offering traditional sports through a partnership with EveryMatrix.