FansUnite Announces Migration of DragonBet and Departure of Chief Technology Officer
- Company expects to achieve approximately $7.1 million in cost savings and is on a firm path to generate positive cash flow in Q4 2023
- Continuing with the strategic plan to improve financial efficiency by focusing on the more profitable Affiliate segment which produces substantial revenues and contributes strong gross margins.
Vancouver, British Columbia–(Newsfile Corp. – August 24, 2023) – FansUnite Entertainment Inc. (TSX: FANS) (OTCQB: FUNFF) (“FansUnite” or the “Company”) announced that it has reached an agreement with DragonBet, a Welsh-based UK sportsbook, to migrate off the Chameleon Gaming platform on or about September 3, 2023, as part of the Company’s strategy to streamline its business operations.
The migration of DragonBet, combined with the sale of the Company’s Chameleon source code to Betr Holdings, Inc. on May 8, 2023, will complete FansUnite’s transition away from business-to-business (“B2B”) platform licensing. As a result of this transition, the Company expects to achieve annualized cost savings of approximately $7.1 million, which includes reductions in salary and selling, general and administrative costs. These cost savings will be reflected in the Company’s financial results once the wind-up of operations of the Chameleon Gaming platform is completed. FansUnite expects to generate positive cash flow in Q4 2023 as a result of its strategic plan to improve financial efficiency. FansUnite will now increase its focus on its affiliate segment, which contributed $23.0 million of its $27.3 million in revenue during Fiscal 2022.
Furthermore, the Company announced that Jeremy Hutchings will step down from his role as Chief Technology Officer on September 30, 2023 to pursue other opportunities in response to the Company’s new strategic focus on the more profitable affiliate segment. He will be available to provide consulting on the Company’s plans to monetize the source code of the Chameleon Gaming Platform through potential further sales of said code. FansUnite would like to thank Jeremy for his contribution and wish him the best in his future endeavors.
“Firstly, I would like to thank my co-founder Jeremy Hutchings for his contribution to FansUnite as he played an integral role during the early stages of the Company and we look forward to watching his future success,” said Scott Burton, CEO of FansUnite. “Additionally, we are pleased to have reached an agreement with DragonBet, which allows them to grow, and will enable us to achieve roughly $7.1 million in cost-savings. These transactions advance our efforts of streamlining our business operations and put us in a position where we can expect to generate positive cash flow in Q4 2023.”
About FansUnite Entertainment Inc.
FansUnite is a global sports entertainment and gaming company, focused on the regulated and lawful sports betting affiliate market which includes customer acquisition, retention, support and reactivation. FansUnite has established itself as a leader in the North American affiliate market through its subsidiary American Affiliate Co LLC (“AmAff” or “American Affiliate”). AmAff is a North American omni-channel customer acquisition company, covering both retail and digital customer activation for sportsbooks, casinos, poker and fantasy sports platforms.
For further information, please contact:
Prit Singh, Investor Relations at FansUnite
This news release contains certain statements that may constitute forward-looking information under applicable securities laws. All statements, other than those of historical fact, which address activities, events, outcomes, results, developments, performance or achievements that FansUnite anticipates or expects may or will occur in the future (in whole or in part) should be considered forward-looking information. Often, but not always, forward-looking information can be identified by the use of words such as “plans”, “expects”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, ”anticipates”, or “believes” or variations (including negative variations) of such words and phrases, or statements formed in the future tense or indicating that certain actions, events or results “may”, ”could”, “would”, “might” or “will” (or other variations of the forgoing) be taken, occur, be achieved, or come to pass. Forward-looking statements in this news release include, but are not limited to, statements with respect to: completion of the Company’s migration off of the Chameleon Gaming platform on or about September 3, 2023, if at all; the Company’s continued plan to streamline its business by focusing on the profitable segments of its business; the definitive terms of the Company’s agreement with DragonBet; expected cost savings in connection with its transition away from being a B2B provider, including in connection with its agreement with DragonBet; the timeline to generate positive cash flow in its operations, if at all; future services to be provided by Jeremy Hutchings, and the terms thereon, if at all; further monetization through sales of the source code of the Chameleon Gaming platform; the Company’s ability to fulfill technology needs with its platform; the Company’s unique portfolio of assets; discussion of future plans, projections, objectives, estimates and forecasts and the timing related thereto, including acquiring technology platforms and assets with high growth potential in new or developing markets, as well as re-focusing its efforts to generate a positive cash flow this year, and further use and development of the source code of the Chameleon Gaming platform.
Forward-looking statements and any financial outlook or future oriented financial information (in each case “FOFI”) are based on assumptions and analyses made by the Company in light of its experience and its perception of historical trends, current conditions and expected future developments, including, but not limited to, expectations and assumptions concerning: interest and foreign exchange rates; capital efficiencies, cost saving and synergies; growth and growth rates; the success in the online gambling and sports betting industry; the regulatory environment applicable to online gambling and sports betting; the technological infrastructure and support needed to host the Company’s online gambling and sports betting platforms and applications; and the Company’s growth plan. While FansUnite considers these assumptions to be reasonable, based on information currently available, they may prove to be incorrect. Readers are cautioned not to place undue reliance on forward-looking statements. In addition, forward-looking statements and FOFI necessarily involve known and unknown risks, including, without limitation, risks associated with general economic conditions; risks associated with the Transaction; risks associated with the Definitive Agreement; risks associated with the regulatory environments in the jurisdictions the Company and the Target operate in; technology-related risks that could adversely effect the Company’s ability to operate its online gambling and sports betting platforms and applications, risks related to the novel coronavirus (COVID-19) global pandemic and any effects it might have on the Company’s business thereto. Readers are cautioned that the foregoing list is not exhaustive. Additional information regarding the risks and uncertainties relating to the Company’s business are contained under the heading “Risk Factors” in the Company’s Annual Information Form dated, March 30, 2023 as filed on its issuer profile on SEDAR at www.sedar.com.
Any FOFI contained in this news release regarding prospective financial position, including, but not limited to: the Company’s expectations that it will continue to realize cost efficiencies; and the Company’s expectations that its strategic plan to improve financial efficiency by focusing on its more profitable American Affiliate segment, including in connection with its agreement with DragonBet and its migration off the Chameleon Gaming platform, will enable the Company to realize operational efficiencies, cost savings, and put the Company in a position to generate positive cash flow in Q4 2023, is based on reasonable assumptions about future events, including those described above, based on an assessment by management of the relevant information that is currently available. The actual results will likely vary from the amounts set forth herein and such variations may be material. Readers are cautioned that any such FOFI contained herein should not be used for purposes other than those for which it is disclosed herein.
Accordingly, readers should not place undue reliance on forward-looking statements FOFI. The forward-looking statements and FOFI in this news release are made as of the date of this news release. FansUnite disclaims and does not undertake to update or revise any forward-looking statements, whether written or oral, that may be made from time to time, whether as a result of new information, future events or otherwise, except as required by applicable securities laws.