VANCOUVER, British Columbia, July 22, 2021 (GLOBE NEWSWIRE) -- ESE Entertainment Inc. (TSXV: ESE) (OTCQB: ENTEF) (the “Company” or “ESE”), is a Europe-based entertainment and technology company focused on esports, and particularly on media rights relating to esports, physical and digital content creation and distribution of esports related content.
To help our new and existing investors better understand existing operations and future objectives, ESE Chief Executive Officer, Konrad Wasiela, is pleased to provide the following corporate update.
Mr. Wasiela stated, "We are taking this opportunity to update our shareholders and the broader investor community about ESE’s achievements to date, as well as highlight our growth plan for the rest of 2021.”
$716,293 quarterly revenue with over 350% increase over the prior quarter
Recently, ESE released its financial results for the quarter ended April 30, 2021, highlights of which include the following:
Quarterly revenues of $716,293, compared to $42,174 in year prior (2020);
Total assets of $6,087,941, compared to $842,093 in the year prior (2020);
Milestone completion of the acquisition of the business of World Performance Group Ltd.
CEO Konrad Wasiela stated, “It is important to note that the financial statements for this period only include results of the WPG Acquisition from the closing date until the end of the quarter (April 12 to April 30, 2021). Therefore, this quarter’s revenue only includes a few weeks of operations as a consolidated group. In future periods, we will be able to reflect the combined operations for the full period in our consolidated financial statements.”
Completion of bought deal financing for gross proceeds of $8,629,600
On July 19, ESE completed a "bought deal" public offering (the “Offering”) of an aggregate of 6,164,000 units of the Company at a price of $1.40 per Unit, for aggregate gross proceeds to the Company of $8,629,600 (net proceeds of $7,870,955 after subtracting the underwriters’ commission and expenses). Further information about the Offering is included in the Company’s news release dated July 19, 2021, which can be obtained under the Company’s corporate profile on SEDAR at www.sedar.com.
ESE aims to be capital efficient and to deliver shareholder value. The Company believes it has succeeded in this regard by delivering solid revenue growth on the approximately $5.9 million raised to date (prior to completion of the Offering). The newly injected net $7.8 million from the bought deal financing is expected to further improve capital stability, to support business growth, and to allow ESE to execute on its existing M&A pipeline.
To date, ESE has completed two acquisitions: K1CK in January 2021, and WPG in April 2021. The Company will continue to seek out accretive acquisitions, with a focus on identifying potential opportunities that can add revenue. ESE continued to set its sights on both organic and M&A growth with the following developments:
LOI signed to acquire Simulation Racing Company, Digital Motorsports
On May 13, 2021, ESE announced that it signed a Letter of Intent (“LOI”) to acquire Auto Simulation Ltd T/A Digital Motorsports (“Digital Motorsports” or “DMS”), an Irish company that provides infrastructure, technology, and support for esports across the globe – particularly in the simulation racing sector – working with some of the world’s most recognized brands. It also operates an ecommerce website at www.digitalmotorsports.com.
Digital Motorsports is an award-winning organization and one of the leading simulation racing companies worldwide, with demonstrated profitability and year-over-year revenue growth.
DMS is anticipated to strengthen our current digital motorsports business and expand our global footprint in the sector. We have identified several immediate synergistic growth opportunities between ESE and DMS. We are working towards completing the potential transaction and excited to work closely with DMS to execute a strategic growth strategy.
Acquisition Completion – World Performance Group
On April 12, 2021, ESE completed its acquisition of World Performance Group Ltd. (“WPG”), an esports gaming and infrastructure company. The highlights of this acquisition include the following:
The completion of the transaction expanded ESE’s esports infrastructure services globally, bridging esports companies with their fans and customers.
In 2020, WPG’s assets generated revenue in excess of $14,000,000.
The transaction added WPG’s existing client base to ESE. Clients of WPG’s subsidiary, WPG Racing Solutions SRL, include one of the largest esports companies in the world, and one of the largest sports organizations.
The acquisition is expected to deliver on core strategic priorities of increasing revenue, expanding tier-1 client base, strengthening technology stack, expanding operational geography, adding experienced executives to ESE’s management, and increasing platform scalability through WPG’s global staff.
ESE’s most recent consolidated quarterly financial results for the period ended April 30, 2021 only reflected revenues attributable to WPG from April 12 (the closing date) to April 30, 2021. WPG’s results of operations for the entire quarter ended July 31, 2021 will be reflected in ESE’s next quarterly consolidated financial statements.
Appointment of Rick Brace, former President of Rogers, to the Board of Directors of ESE
On April 25, 2021, ESE appointed Rick Brace to its Board of Directors. Mr. Brace most recently served as the President of Rogers Media, the sports and media subsidiary of Rogers Communications.
As President of Rogers Media, Rick Brace was responsible for driving strategy and overseeing operations for the company’s robust portfolio of media assets, which includes 42 TV stations, 51 radio stations, 56 publications, digital media, subscription-based content services, the Toronto Blue Jays, and Rogers Centre.
CEO of ESE, Konrad Wasiela, commented, “It is a privilege to appoint Rick Brace as a director of ESE. His willingness to be hands-on and commit to corporate strategy and provide his operational expertise has been priceless. We have just scratched the surface of the value Rick can add to the ESE group.”
ESPORTS AND GAMING OPERATIONS
Esports and Gaming Talent Show Project
On May 6, 2021, ESE announced that it had signed a content production contract with Electric Vault Sp. z o.o. (“Bitcoin Vault”) for a major roll out of an esports and gaming talent show (the “Gaming Show”). Pursuant to the agreement, ESE is anticipated to produce and distribute a gaming and esports talent show in China, Japan, South Korea, Vietnam, and Brazil.
Under the terms of ESE’s contract with Electric Vault, in consideration for its services, ESE will be paid a total of 3,266,000 PLN (approximately CAD $1,059,483), plus VAT, with 20% payable within seven days of signing the agreement, and the balance due upon completion of the services. The consideration payable to ESE is subject to increase in the event the scope of services is expanded. Production work on the project is in progress with the project expected to be completed in late October.
ESE intends its development and production of the Gaming show to act as a launch pad for the expansion of the media production vertical of its business.
ESE Launches Esports Tournament for Primeira Liga Soccer Club, Rio Ave FC
On April 29, 2021, ESE announced that its esports team, K1CK, was launching a tournament in collaboration with the Rio Ave Football Club (“Rio Ave FC”), a Portuguese football club that competes in the Portuguese Primeira Liga, the top division of Portuguese football.
The tournament, called the Rio Ave FC K1CK Cup, took place on FIFA 21, a popular soccer video game developed by Electronic Arts Inc.
Konrad Wasiela, CEO of ESE, commented, “We are thrilled to be selected by a top-tier soccer club such as Rio Ave FC to rollout their first ever esports tournament. This is a clear example of how esports continues to be an important investment commitment for traditional sports organizations looking to maximize brand exposure and fan engagement. We are excited for the launch of this tournament and we look forward to more collaborations moving forward.”
ESE’s secured rights to televised esports competition, Ultraliga, for the game League of Legends
ESE enlarged its footprint in Europe by securing a team slot in the Ultraliga tournament. Ultraliga is a professional esports competition where players compete in the fight for the title, cash prize pool, and a promotion to the next stage of European competition. The tournament is in official cooperation with the game publisher – Riot Games and is broadcast on Polish National TV and the internet in collaboration with media conglomerate Polsat. In 2019, Ultraliga had over 24 million viewers tune into its esports channel.
The Company will continue to evaluate the changing global gaming landscape, primarily focused on Europe and Asia. It also hopes to begin expansion into the North American market.
The Company will also evaluate new technologies and infrastructure which may be utilized in the Company’s field of operation.
The Company will actively pursue strong partnerships in the area of strengthening merchandise offerings, expanding media outlets, and partnering with new game developers and publishers.
The Company will look to add more senior management and advisors, with a focus on operational expertise.
The Company will actively pursue new acquisitions.
The Company will aim to grow the production and agency portion of the business.
Implementing a growth business plan with a strong focus on integration of acquisitions in order to maximize value and extract synergies.
CEO, Konrad Wasiela concludes: “I am very pleased with the progress of our operations and financial position halfway through 2021. We managed to improve our margins significantly while growing our business quarter over quarter, which was achieved by focusing on key clients and our strong M&A strategy. We look forward to a similar growth profile over the next half of 2021 driven by further growth from the aforementioned M&A and other material contracts the company has been working on.”
About ESE Entertainment Inc.
ESE is a Europe based entertainment and technology company focused on gaming, particularly on esports. ESE consists of multiple assets and world-class operators in the gaming and esports industries. Capabilities include but are not limited to: physical infrastructure, broadcasting, global distribution for gaming and esports-related content, advertising, sponsorship support, and a growing esports team franchise, K1CK Esports. ESE is focused on bridging Europe, Asia and North America. | www.ese.gg
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 ESE anticipates or expects may or will occur in the future (in whole or in part) should be considered forward-looking information. Such information may involve, but is not limited to, comments with respect to: (i) the Company’s future revenues, and its ability to maintain revenue growth; (ii) the success of the Company’s past and future acquisitions; (iii) the use of proceeds of the Offering; (iv) the ability of the Company to identify M&A targets, and its ability to execute on the same; (v) the likelihood of completing the acquisition of DMS; (vi) the Company’s ability to identify and appoint suitable members of senior management and advisors; (vii) the Company’s ability to expand the media production vertical of its business; (viii) the Company’s ability to expand into the North American market; and (ix) the Company’s ability to identify and adopt new technologies and infrastructure. 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 information is based on currently available competitive, financial and economic data and operating plans, strategies or beliefs as of the date of this news release, but involve known and unknown risks, uncertainties, assumptions and other factors that may cause the actual results, performance or achievements of ESE to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information. Such factors may be based on information currently available to ESE, including information obtained from third-party industry analysts and other third-party sources, and are based on management's current expectations or beliefs regarding future growth, results of operations, future capital (including the amount, nature and sources of funding thereof) and expenditures. Any and all forward-looking information contained in this press release is expressly qualified by this cautionary statement. Trading in the securities of ESE should be considered highly speculative.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE ESE Entertainment Inc.
For further information about ESE, please contact:
Daniel Mogil, Investor Relations