LuckBox Announces Improved 2020 Financial Figures

2020 was a very important year for LuckBox due to several factors and despite tough trading conditions, governed largely by the pandemic, the owner of Luckbox, Real Luck Group, managed to cut its losses by almost 75% throughout the year.

The relatively new esports betting site (you can find out more about the company by reading our LuckBox Review) managed to see a marked increase in revenue to $75,500 throughout the financial year. That is 18 times greater than what the company achieved in 2019.

All the revenue came from its base of operations on the Isle of Man.

“Developing our Proprietary Esports Betting Platform”

While these revenues remain low compared to other providers in the industry, it is not overly concerning for the parent company as Chief Executive Quentin Martin explained.

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

Initially, this was a positive, but it wasn’t all good news as Martin moved on to remark.

“However, the calendar of esports events was adversely impacted, particularly in the second half [of 2020], due to the postponement of the biggest esports event of the year – the Dota 2 International.”

Operating Loss of $5.4 Million

The cost of sales also increased markedly, up 255.6% to $288,900, which meant that the company made a gross loss of $212,500 over the course of the year.

On top of this, the company also incurred operating expenses of $5.2 million, which was 73.2% less than in 2019. The massive reduction in expenses was due largely to a reduction in share-based compensation.

Salaries and fees paid to directors were the largest of all the operational expenses, costing the company $1.5 million. A further $907,100 was spent on professional and legal fees. Share-based compensation dropped massively to $887,600 while there were a further $521,400 in general costs.

Combining all the accounts, this meant that the company made an operating loss of $5.4 million during the year.

Expenses incurred due to the company listing on the TSX Venture Exchange in Toronto, as well as a gain on convertible options in effect cancelled each other out but when added on to the operational loss, meant a total pre-tax loss of $5.5m.

This is a reduction of 73.3% in 2019.

Future Looks Bright

2020 was always going to be a year of consolidation and an exercise in developing the foundations of the LuckBox business model and it appears that its parent company are ready to swallow these losses with a view to the business becoming much more profitable in the future.

“Fiscal 2020 was an important year for our young company,” stated Martin.

“We achieved several important milestones, including our oversubscribed equity financing and public listing on the TSX Venture Exchange.”

“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.”

Furthermore, with the recent announcement that LuckBox is to expand its betting offering by including traditional sports betting alongside esports betting and bitcoin-based esports betting, it seems likely that the companies improving financial position will continue in 2021.

Source: https://www.esportsbets.com/news/luckbox-improved-2020-financial-figures/