Announcement PDF RESULTS FOR ANNOUNCEMENT TO THE MARKET UNDER ASX LISTING RULE 4.3A APPENDIX 4E PRELIMINARY FINAL REPORT Name of entity: ABN: BetMakers Technology Group Ltd 21 164 521 395 Reporting period: Previous period: For the year ended 30 June 2024 For the year ended 30 June 2023 RESULTS FOR ANNOUNCEMENT TO THE MARKET $’000 Revenues from ordinary activities up 0.2% to 95,203 Loss from ordinary activities after tax attributable to the owners of BetMakers Technology Group Ltd down 0.3% to (38,667) Loss for the year attributable to the owners of BetMakers Technology Group Ltd down 0.3% to (38,667) DIVIDENDS There were no dividends paid, recommended or declared during the current financial period. COMMENTS The loss for the Group after providing for income tax amounted to $38,667,000 (30 June 2023: $38,781,000). This includes a deferred tax asset movement of $20,130,000 (30 June 2023: $nil) and a share-based payments benefit of $1,916,000 (30 June 2023: expense of $8,349,000). Further information on the 'Review of operations' is detailed in the Directors' report and Chief Executive Officer's report which is part of the Annual Report. NET TANGIBLE ASSETS Consolidated 2024 $’000 2023 $’000 Net assets 111,554 150,596 Less: Intangibles (59,130) (56,706) Less: Right-of-use (ROU) assets (2,887) (4,331) Add: Lease liabilities - current 1,556 1,401 Add: Lease liabilities - non-current 1,599 3,308 52,692 94,268 Net tangible assets Number of shares Number of ordinary shares on issue Net tangible assets per ordinary security 2024 2023 965,114,395 943,541,600 REPORTING PERIOD CENTS PREVIOUS PERIOD CENTS 5.46 9.99 BETMAKERS TECHNOLOGY GROUP LTD APPENDIX 4E PRELIMINARY FINAL REPORT CONTINUED CONTROL GAINED OVER ENTITIES Not applicable. LOSS OF CONTROL OVER ENTITIES Not applicable. DETAILS OF ASSOCIATES AND JOINT VENTURE ENTITIES Not applicable. FOREIGN ENTITIES Details of origin of accounting standards used in compiling the report: Currently all accounting policies of the Group are consistent with those adopted by its ultimate holding company, BetMakers Technology Group Ltd. AUDIT QUALIFICATION OR REVIEW Details of audit/review dispute or qualification, if any: The financial statements have been audited and an unmodified opinion has been issued. ATTACHMENTS Details of attachments (if any): The Annual Report of BetMakers Technology Group Ltd for the year ended 30 June 2024 is attached. SIGNED As authorised by the Board of Directors: _______________________________ Matt Davey Chairman Date: 30 August 2024 BETMAKERS TECHNOLOGY GROUP LTD FY24 FULL-YEAR RESULTS ANNUAL REPORT BetMakers Technology Group Ltd. DATED 30 June 2024 ABN 21 164 521 395 © 2024 BetMakers Technology Group Ltd. All Rights Reserved. TABLE OF CONTENTS OPERATIONAL HIGHLIGHTS 6 CEO'S LETTER 7 DIRECTORS' REPORT 9 REMUNERATION REPORT 22 AUDITOR'S INDEPENDENCE DECLARATION 35 FINANCIAL STATEMENTS 37 Statement of Profit or Loss and Other Comprehensive Income Statement of Financial Position Statement of Changes in Equity Statement of Cash Flows 38 39 40 41 NOTES TO THE FINANCIAL STATEMENTS 42 DIRECTORS' DECLARATION 86 INDEPENDENT AUDITOR'S REVIEW REPORT 87 SHAREHOLDER INFORMATION 95 CORPORATE DIRECTORY 99 BETMAKERS TECHNOLOGY GROUP LTD 4 RACING ENHANCED. BetMakers delivers world leading B2B technology solutions for tote and fixed odds betting on racing. BetMakers Technology Group (ASX:BET) is a leading international provider of B2B technology products with a global footprint that spans the world’s major racing and betting markets. Our technology and service solutions enhance betting on racing at critical points along the life cycle for fixed odds and pari-mutuel wagering, unlocking new revenue streams, expanding markets, and enhancing user experience. BETMAKERS TECHNOLOGY GROUP LTD 5 Operational Highlights OPERATIONAL HIGHLIGHTS ← Back to Contents OPERATIONAL HIGHLIGHTS In FY24 BetMakers realised material benefits from a disciplined execution of its turnaround strategy whilst still pursuing new product and commercial initiatives. SUCCESSFUL EXECUTION OF TURNAROUND STRATEGY A focus on lowering the cost base, exiting unprofitable contracts, restructuring operations and rebuilding our technology platform produced improvements in operating expenses and adjusted EBITDA. TECHNOLOGY INVESTMENT SETS THE STAGE FOR EFFICIENCY AND GROWTH Next Gen, a transformational revamp of BetMakers' core technology platform, rolls out in Q1 FY25 to offer BetMakers customers an enhanced end user experience, a suite of new services and features, updated Form and Content from RACELAB, and tools for customer acquisition and retention, whilst also reducing costs and streamlining operations. capacity to deliver high margin and sustainable long term value. We signed or renewed contracts with 29 operators in FY24, leveraging investments in technology to expand into new markets and customer segments and leading to key deals with Bet365, PA Betting Services, Kambi, GiG and others. A HIGHLY STRATEGIC ACQUISITION The acquisition of RACELAB adds leading proprietary models, race form, preview, and statistics technology to the BetMakers ecosystem, offers potential to further expand services in the harness and greyhound form and preview racing sectors, and brings new customers to BetMakers. A particularly synergistic addition, the integration of RACELAB operations into our existing global infrastructure is driving new revenues via existing sales channels and boosting the strategic profiles of both RACELAB ProFORM™ and BetMakers ODDS ENGINE™ technologies. CLIENT RETENTION, ACQUISITION AND GROWTH INITIATIVES FY24 Commercial and growth initiatives focused on products and regions with the $88.8M ↑ +1.0% vs pcp 97% FY24 REVENUE CONTRACTED REVENUE2 $65.3M -$7.2M OPERATING EXPENSES3 FY24 ADJUSTED EBITDA (EX CUSTOMER LOSS)1 1. Excludes $6.4m of revenue related to betr customer loss announced on 11 April 2024. Reported FY24 Revenue was $95.2m. 2. Contracted Revenue refers to revenues derived from customers who had contracts in place prior to the beginning of the financial year. ↓ -26% vs pcp ↑ +74% vs pcp 3. Excludes capitalised costs of $6.3m associated with Next Gen. There were no capitalised staff costs in FY23 BETMAKERS TECHNOLOGY GROUP LTD 6 CEO'S LETTER ← Back to Contents CEO'S LETTER Dear Shareholders, I am pleased to present BetMakers’ Annual Report for the 2024 Financial Year, highlighting our progress toward profitability and long-term sustainability. FY24 has been a significant year of transition, marked by securing key new contracts and renewals, implementing new technologies, and completing the major restructuring initiative that had been started the previous year. These efforts have streamlined our operations and substantially reduced operating costs. We have made considerable strides towards generating positive operating cash flows and enhancing margins by simplifying our global operating model, all while continuing to seek out and win new business opportunities. As we look ahead to FY25, our focus remains on delivering a sustainably profitable business. The investments we have made in developing and expanding our industryleading technologies and services position us well to seize the growth opportunities we are nurturing in international markets... ...and to maintain robust partnerships with our existing customers. The development of our Next Gen platform is entering its final stages, and once launched, it will represent a significant advancement in user experience, customer engagement, and retention capabilities. Moreover, it is expected to deliver substantial operational efficiencies and cost savings for BetMakers. In FY24 we enhanced our Form and Content capabilities with the acquisition of RACELAB. The product will feature prominently in BetMakers’ solutions, including Next Gen Embedded and Next Gen Platform. RACELAB's proprietary ProFORM™ ratings and associated products are a powerful market differentiator for BetMakers and offer our customers robust new tools for player engagement. The broader Australian fixed odds wagering market experienced some softness over the past 12 months which impacted our revenue. In addition, we began to CEO's Letter Jake Henson Chief Executive Officer migrate a key client, betr, off our platform, which has a short-term impact on revenue. Despite these impacts, we have built an incredibly strong foundation from which we can build to position BetMakers as a strong B2B player, offering a truly comprehensive solution for fixed odds and tote wagering, that can generate sustainable profits at attractive margins. The rollout of the Next Gen products, continued improvements in Global Tote contract margins, and growing contributions from international markets are expected to play a key part in these growth ambitions moving forward, which we expect to show through in FY25. FINANCIAL PERFORMANCE The Company reported revenue of $95.2 million, which was flat vs. pcp. FY24 Revenue was supported by securing 13 new contracts with entities such as bet365, Caesars Entertainment and Selangor Turf Club, and 16 renewals including with Boyd Gaming, Evoke and PointsBet Australia. Revenue growth was offset by softer performance in the Australian market, including with respect to the loss of the betr contract. The major operational restructure announced last year has now largely been completed. The restructure allowed us to substantially reduce product manufacturing, operations, staffing, administrative, and corporate costs, and to simplify the business into two key segments to create a sustainable business that is well-prepared for the future. Pleasingly, BetMakers recorded an adjusted EBITDA loss of $7.2 million, significantly improved by 74% on the FY23 loss of $27.8 million. PEOPLE BetMakers has a talented and dedicated team driving the business forward and committed to delivering long-term growth and sustainability. The strategic operational restructure has allowed us to streamline our operations and reposition the global workforce with the right people in place to take the group forward and grow. In senior management, FY24 saw the departure of CFO Anthony Pullin and the subsequent appointment of Carl Henschke – most recently Managing Director at Canaccord Genuity – as the new Chief Financial BETMAKERS TECHNOLOGY GROUP LTD 7 CEO'S LETTER ← Back to Contents Officer. We were delighted to welcome Carl, whose many years of experience in financial services, capital markets and legal sectors make him an excellent addition to the BetMakers executive team. The Board of Directors saw one change in FY24, with Nick Chan stepping down from his non-executive position in October of 2023. AN ONGOING COMMITMENT TO SUSTAINABILITY Since the establishment of the Environmental, Social and Governance (ESG) Committee in FY22, the Company has continued to identify and prioritise key ESG initiatives. We continue to integrate a number of responsible gaming features into BetMakers’ global solutions and we have mandated additional employee training and education programs on responsible gaming. From a social perspective, we have continued our popular volunteerism programs across our global offices to encourage team members to support worthy social initiatives where they live. We recognise the importance of sustainable practices and remain committed to continuing to work toward delivering positive ESG outcomes. KEY DEALS In FY24 we were pleased to enter into a new arrangement with PA Betting Services to launch The AdVantage Platform, a turn-key B2B race streaming and wagering platform for wagering operators. We also signed market access and content agreements with bet365 relating to the US states of New Jersey and Colorado, a new contract to deliver racebook services on GiG’s sportsbook platform SportX, a new contract to deliver our newly revamped Price Manager fixed odds solution to Kambi’s sportsbook, and a contract to offer betting on French racing in Australia through an agreement with Pari Mutuel Urbain (PMU) of France. We secured a string of Global Tote contract renewals, some with terms as long as 10 years, with The Meadowlands, Hawthorne Race Course, Nassau Regional Off-track Betting Corp., Boyd Gaming, Jockey Club del Perú, and Argentina Jockey Club, among others. FY25 EXPECTATIONS With the progress we have made over the past two years to reset our cost base, streamline operations and build quality new tech solutions we will be focused in FY25 on continued improvement in operating efficiency and gross margin. We plan to deliver on the final components of our tech rebuild, rolling out Next Gen to our Embedded Solution and Platform clients and creating further synergies across product categories such as web and mobile wagering platforms and terminal software. Post our tech rebuild, we are looking to further streamline business operations to drive maximum efficiency from our global service delivery network. Our Sales and Commercial team continue to pursue new and renewed long-term contracts and to build out our deal flow pipeline by opening up new markets with the intention of bringing racing and racing products to new customers, in new markets. I remain confident that BetMakers will continue to make significant progress in FY25 and that our F24 achievements in technology, operations, and partnerships will make this a year of growth and improved performance. Regards, Jake Henson CEO BETMAKERS TECHNOLOGY GROUP LTD 8 DIRECTORS' REPORT ← Back to Contents DIRECTORS' REPORT The Directors present their report, together with the financial statements, on the consolidated entity (referred to hereafter as the 'Group') consisting of BetMakers Technology Group Ltd (referred to hereafter as the 'Company', 'BET' or 'Parent Entity') and the entities it controlled at the end of, or during, the year ended 30 June 2024. PRINCIPAL ACTIVITIES The Group’s principal activities during the financial year were the development and provision of software, data and analytic products for the B2B wagering market and the production and distribution of racing content. REVIEW OF OPERATIONS The loss for the Group after providing for income tax amounted to $38,667,000 (30 June 2023: $38,781,000). This includes a deferred tax asset movement of $20,130,000 (30 June 2023: $nil) and a share-based payments benefit of $1,916,000 (30 June 2023: expense of $8,349,000). The information presented in this Review of Operations has not been audited in accordance with the Australian Auditing Standards. All figures are in Australian dollars unless otherwise stated. The Directors consider EBITDA to reflect the core earnings of the Group. EBITDA is a financial measure which is not prescribed by Australian Accounting Standards ('AAS') and represents the profit under AAS adjusted for non-cash and significant items. The Group’s reconciliation of its statutory net loss before tax (‘NLBT’) for the current and previous year to adjusted EBITDA is as follows: 2024 $'000 2023 $'000 VARIANCE $'000 VARIANCE % Revenue 95,203 95,027 176 - Gross margin 57,402 59,176 (1,774) (3%) Loss before income tax Add/(Less) back: Depreciation and amortisation Net Finance costs Share-based payments expense Impairment of assets Deal costs Impairment of receivables Gain on valuation of financial liabilities Bargain on purchase (17,857) (53,399) 35,542 (67%) 12,196 444 (1,916) 238 657 (218) (765) 11,793 643 8,349 8,870 3,419 (7,500) - 403 (199) (10,265) (8,632) (3,419) 657 7,282 (765) 3% (31%) (123%) (97%) (100%) (97%) - Adjusted EBITDA (7,221) (27,825) 20,604 (74%) Directors' Report BETMAKERS TECHNOLOGY GROUP LTD 9 DIRECTORS' REPORT ← Back to Contents OPERATIONAL HIGHLIGHTS BetMakers is a leading B2B technology Company servicing the global racing and online sports betting industries. The Group is defined through two divisions; Global Betting Services and Global Tote. The Company achieved revenues for the year of $95,203,000, an increase of 0.18% compared to the prior year (2023: $95,027,000). • The completion of a major operational restructure that commended in FY23 to streamline costs and drive efficiencies; • Investment in the development of the Company’s Next Gen technologies; and • Growth in the Global Tote division. Consolidated 2024 $'000 2023 $'000 VARIANCE $'000 VARIANCE % Global Betting Services 40,433 41,843 (1,410) (3.37%) Global Tote 54,770 53,184 1,586 2.98% Total revenue 95,203 95,027 176 - The FY24 operational highlights across the two divisions are outlined on the following pages. BETMAKERS TECHNOLOGY GROUP LTD 10 DIRECTORS' REPORT ← Back to Contents DIVISION HIGHLIGHTS DELIVERED AND PROGRESSED KEY PRODUCT UPGRADES BetMakers’ Next Gen technologies for wagering are poised for completion in the first part of FY25 with initial rollout to Embedded Solution and Platform fixed odds clients. Marking the most significant product revamp of BetMakers’ history, Next Gen offers clients a faster, more powerful solution, with key updates to the user journey, integration of form, content and tips from the recently acquired RACELAB’s ProForm™, a complete revamp of the back office tools, gamification and tokenisation upgrades for player engagement, and important CRM tools for customer acquisition. In addition to its important customer and end user updates, changes in cloud infrastructure resulting from Next Gen’s multi-tenant architecture are expected to deliver additional cost savings. In FY24, BetMakers rolled out a major update to its Price Manager fixed odds pricing and risk management platform, delivering new and enhanced features and permanently moving away from legacy systems, thereby reducing infrastructure costs. The Company completed development of its new DataFusor data integration system. Replacing legacy systems for data compiling and distribution, DataFusor is a highly efficient, reliable and scalable new platform that is expected to streamline operations and provide a more robust solution for BetMakers’ data needs. Rollout of DataFusor began with the start of FY2025. ROLLOUT OF CAESARS EMBEDDED RACEBOOK SOLUTION Rollout of BetMakers’ embedded racebook solution commenced in FY24, with 22 Caesars locations in Nevada now using the solution along with additional Caesars sites in Iowa. This stems from BetMakers’ agreement to become the exclusive provider of pari-mutuel racing services for Caesars Entertainment Inc’s brick-and-mortar retail sportsbook locations. BetMakers’ Embedded Racebook is a middleware and software solution that connects Caesars’ William Hill Liberty platform into pari-mutuel pools. Global Tote’s software solutions support this kind of complex integration with partners in adjacent gaming industries including lottery provider and casinos, providing a key differentiator for the division that we will continue to leverage for future growth opportunities. BETMAKERS TECHNOLOGY GROUP LTD 11 DIRECTORS' REPORT ← Back to Contents DIVISION HIGHLIGHTS PARTNER WITH PA BETTING SERVICES In February 2024 the Company signed an agreement to partner with PA Betting Services, part of UK-based PA Media Group, to launch a new platform that combines the latest wagering technologies and content solutions in a single powerful platform branded "The AdVantage Platform”. The AdVantage Platform is being offered as a B2B turn-key solution for wagering operators in international markets, including the existing 200+ wagering customers of PA Betting Services. PROGRESSED INTERNATIONAL FIXED ODDS RACING PRODUCT In Q4 of FY24, BetMakers entered into two-year market access and content agreements with Bet365 relating to New Jersey and Colorado. Under the agreements, Bet365 is licensed by BetMakers to offer fixed odds bets on thoroughbred horse racing to bet365 customers within New Jersey and to distribute BetMakers’ thoroughbred racing content to bet365 customers in New Jersey and Colorado. ACCOUNT ACQUISITION AND RETENTION ACTIVITIES In FY24 BetMakers’ GBS division signed four new fixed odds and six new content management and distribution services contracts, including with Kambi, GiG and TonyBet for fixed odds and with PMU of France for content management and distribution. The division renewed three contracts including those with William Hill and PointsBet Australia. CHANGES IN BETR AGREEMENT On 11 April 2024 the Company announced certain changes to its agreement with fixed odds platform client NTD Pty Limited (trading as “betr”) in connection with a pending sale of the betr wagering service. BetMakers will continue to provide minor services to betr under a reduced service arrangement until the migration of betr customers to the new owner’s platform is complete, which is expected to occur in the first part of FY2025. The cessation of the betr agreement is expected to result in significant savings and efficiencies for BetMakers and has expedited the timeline for completion and rollout of the Next Gen technologies for BetMakers’ Embedded Solution and Platform clients. Bet365 will pay BetMakers a ‘Market Access Fee’ based on a percentage of all fixed odds bets placed in New Jersey on all thoroughbred racing events it offers to its customers and a ‘Content Fee’ based on a percentage of all fixed odds bets placed in New Jersey and Colorado on applicable BetMakers content. BETMAKERS TECHNOLOGY GROUP LTD 12 DIRECTORS' REPORT ← Back to Contents DIVISION HIGHLIGHTS STRONG ACCOUNT ACQUISITION AND RETENTION In FY24 Global Tote secured three new and 13 renewal contracts with key customers including Nassau Regional Off-track Betting Corporation in New York, Columbus Racing of Nebraska (a Caesars Entertainment property) three Boyd Gaming racetracks, Hawthorne Race Course in Illinois, Mohegan Tribal Gaming Authority in Connecticut, Jockey Club del Perú, Selangor Turf Club in Malaysia, Argentina Jockey Club, ZeTurf in the Netherlands and The Meadowlands in New Jersey, among others. NEARING DELIVERY OF ENTERPRISE TOTE SOLUTION FOR NORSK RIKSTOTO Global Tote made significant progress in FY24 on the development of a Quantum™ pari-mutuel solution for Norsk Rikstoto, the sole purveyor of betting on horse racing in Norway. The ten year agreement is for a fully managed SaaS Quantum™ solution to replace Norsk Rikstoto's current system and integration with existing web, mobile and terminal platforms. OPERATIONAL AND TECHNOLOGY CHANGES DRIVING EFFICIENCY AND CUSTOMER SATISFACTION Global Tote continued in FY24 to deploy its BetLine wagering terminals to clients including those in the USA, Asia and Latin America, decreased costs for maintenance and support and delivering an overall better user experience. Further changes to components and processes, along with the introduction of a OneWatch™, Global Tote’s new terminal monitoring and analytics solution, have driven down service incidents dramatically, lowering costs and increasing client satisfaction. The Norway project is expected to go live in FY25 after a lengthy development and customisation phase which adds new features and functionality that will become part of the global Quantum™ product suite. BETMAKERS TECHNOLOGY GROUP LTD 13 DIRECTORS' REPORT ← Back to Contents CORPORATE HIGHLIGHTS COMPLETED ORGANISATIONAL RESTRUCTURE TO SIGNIFICANTLY REDUCE OPERATING AND STAFF COSTS During FY24, the Company completed execution of an organisational restructure and technology updates based on the recommendations of a broad operational review conducted in FY23. With completion of the major phases of the restructure, the cost base has been significantly reduced, more closely corresponds with current revenues, and reflects an organisation better prepared to capitalise in FY2025 on the Company’s investments in Next Gen and in opportunities in international markets. The Company’s headcount at 30 June 2024 is approximately 376, a significant reduction from the 31 December 2022 position of 568 employees. ACQUIRED RACELAB ASSETS In FY24, BetMakers acquired RACELAB Assets, a highly strategic acquisition that adds RACELAB’s leading ProForm™ proprietary models, race form, preview, and statistics technology to BetMakers’ Form and Content suite. The product will feature prominently in BetMakers’ Next Gen Embedded and Next Gen Platform solutions. CHANGES IN SENIOR MANAGEMENT Carl Henschke was named Chief Financial Officer in June 2024, replacing Anthony Pullin who resigned in March 2024. Nick Chan stepped down from his non-executive post on the Board of Directors in October 2023. His position was not filled, as it was determined that the board composition is appropriate for a company of BetMakers’ size and profile. BETMAKERS TECHNOLOGY GROUP LTD 14 DIRECTORS' REPORT ← Back to Contents STRATEGIC FOCUS & OUTLOOK With FY24 a turnaround year in which the Company focused on restoring operational discipline, FY25 will be a year of transformation, with the Company focused on transforming into a business that can deliver sustainable profit. The FY25 strategic focus for the Company is: CONTINUING TO IMPROVE OPERATING MARGINS Having reset the cost base by identifying and addressing operational inefficiencies and streamlining operations, a Company focus in FY2025 will be on improving margins further through reductions in operating costs and overheads as well as cloud costs. These initiatives are expected to result in increased operating leverage in FY25 and future period. DELIVERING THE NEXT GEN PLATFORM The final stage of the Next Gen platform are expected to go live in Q1 FY25 with significant benefits to platform performance and operations. This will complete the product suite rebuild for GBS. This is expected to deliver improved infrastructure and operating efficiencies, whilst offering customers increased speed, a feature-rich user experience, and critical tools for user engagement and retention. FOCUS ON NEW CUSTOMERS AND CONTRACTS WITH THE OPPORTUNITY FOR HIGHER GROSS MARGIN Completion of the Next Gen rebuild in FY25 is expected to deliver a full suite of higher gross margin, scalable products from which we expect to realise growth from both Australian and international customers. New contracts wins so far in FY25 include a new tote contract with a major operator in Chile and a partnership arrangement with respect to the distribution of BetMakers Embedded Racebook platform via Sportingtech. BETMAKERS TECHNOLOGY GROUP LTD 15 DIRECTORS' REPORT ← Back to Contents PRINCIPAL RISKS Identifying and mitigating business risks that may affect the Group’s strategy and financial performance is an essential part of the governance framework. This section outlines some of the key risks identified by the Group. They are not listed in order of importance or likelihood to materialise. RISK AREA DESCRIPTION Impact of Operating Losses The Group has incurred operating losses in recent periods and may continue to do so in the foreseeable future. This presents several risks, including but not limited to: • Sustainability of Operations: Continued losses may impact the Group’s ability to sustain its operations, potentially leading to the need for additional financing or cost-cutting measures. • Access to Capital: Persistent losses can affect the Group’s ability to raise capital on favourable terms. Investors may be reluctant to provide additional funding, or the cost of such funding may be prohibitively high. • Market Confidence: Ongoing losses can erode market confidence in the Group’s business model and management, which could also impact access to capital. • Strategic Flexibility: Financial losses may limit the Group’s ability to invest in growth opportunities, research and development, or other strategic initiatives that are critical for long-term success. Customer Credit Risk The Group is subject to credit risk associated with its customers and in particular that customers may fail to meet their payment obligations which could adversely affect the Group’s performance and its financial position. This risk can be impacted by several factors including: • Creditworthiness of Customers: The risk that customers may default on their payments due to financial difficulties, leading to bad debt expenses and impacting the Group’s cash flow. • Economic Conditions: Adverse economic conditions, such as a recession, can increase the likelihood of customer defaults as businesses and consumers face financial strain. • Credit Policies: The effectiveness of the Group’s credit policies and procedures in assessing and managing customer credit risk. • Collection Processes: The efficiency and effectiveness of the Group’s processes for collecting outstanding receivables. Poor collection practices can result in delayed payments and increased bad debts. Deterioration in Financial Position The Group faces the risk of a deterioration in its financial position due to various factors, including but not limited to fluctuations in market conditions that can adversely impact the Group’s revenue and profitability; economic recessions or slowdowns that can reduce demand for the Group’s products or services; or inefficiencies or disruptions in operations that can lead to increased costs and reduced margins. If these risks materialise, in certain circumstances the Group may be required to raise additional equity capital to further supports its business. Customer Risk The Group faces the risk of encountering challenges in attracting new customers due to several factors including but not limited to increased market competition, changing preferences of the Group’s customers, negative publicity or a decline in the reputation of the Group, economic downturns or rapid advancements in technology that may require significant investment. BETMAKERS TECHNOLOGY GROUP LTD 16 DIRECTORS' REPORT ← Back to Co