Enthusiast Gaming Continues to Strengthen Balance Sheet Through C$6.8 Million Sale of Select Legacy Assets

Enthusiast Gaming Continues to Strengthen Balance Sheet Through C$6.8 Million Sale of Select Legacy Assets

Sale Proceeds Represent ~4.5x Multiple to Associated Revenue

LOS ANGELES, Sept. 29, 2022 — Enthusiast Gaming Holdings Inc. (“Enthusiast Gaming” or the “Company”) (NASDAQ:EGLX; TSX:EGLX), an integrated gaming entertainment company, today announced the sale of certain video game editorial websites (the “Website Assets”) for a purchase price of approximately C$6.8 million, representing a multiple of approximately 4.5x associated revenue.

Between the sale and the Company’s expanded credit facility announced on September 19, 2022, the Company has bolstered its balance sheet with over C$16.8 million of non-dilutive capital in recent weeks while reducing operating costs in the business.

The future of gaming content is video, streaming and interactive content with cross-platform viewership capabilities. These high-growth, high-margin segments have been the core drivers in our reaching over 40 billion views annually and expanding our gross margins to over 30%,commented Adrian Montgomery, Chief Executive Officer of Enthusiast Gaming. “The sale of these legacy assets will allow us to focus our resources on these core business capabilities as we continue to develop proprietary, product-based media and entertainment offerings that address these markets, such as our Addicting Games platform, EV.IO, Gamers Greatest Talent, Luminosity Gaming, our U.GG desktop app with now over a million downloads, and our first-of-its-kind collaboration with the NFL in NFL Tuesday Night Gaming. Moreover, by securing this sale at strong multiples, we have further strengthened our balance sheet while simultaneously reducing operational costs, giving us ample runway to get to profitability, which we remain on pace for in the near-term.”

“As our gaming communities have evolved in terms of their preferred mediums for gaming content, our advertising partners have taken notice,” added Bill Karamouzis, President of Enthusiast Gaming. “Video, streaming and interactive content routinely drive our highest CPM yields and margin growth as advertisers look to take advantage of our proprietary communities, platforms and applications and their data-rich capabilities to drive engagement with our audiences. By focusing our asset portfolio on these core segments, we are well-positioned to use the resources gained from this sale to give both our audiences and our advertising partners more of what they want.”

Among the Website Assets included as part of the sale are Destructoid.com, Siliconera.com, Upcomer.com, PCInvasion.com, Operationsports.com and EscapistMagazine.com, together with their respective social media handles and the Company’s rights to certain legacy domains and related content such as NintendoEnthusiast.com.

About Enthusiast Gaming

Enthusiast Gaming is an integrated gaming entertainment company, building the largest media and content platform for video game and esports fans to connect and engage worldwide. Combining the elements of its four core pillars: Communities, Content, Creators, and Experiences, Enthusiast Gaming provides a unique opportunity and integrated approach to reach and connect with its coveted GenZ and Millennial audience. Through its proprietary mix of digital media and entertainment assets, Enthusiast Gaming has built a vast network of like-minded communities to deliver the ultimate fan experience.

Contacts

Enthusiast Gaming Investor Relations:
Eric Bernofsky, Chief Corporate Officer
investor@enthusiastgaming.com

Forward-Looking Statements

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 Enthusiast Gaming 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 regarding future gaming content consumption patterns, the impact and potential use of the proceeds from the sale of the Website Assets, and the Company’s future financial performance and strategic objectives.

Forward-looking statements 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 esports and gaming media industry; the Company’s growth plan, and judgment applied in the application of the Company’s accounting policies and in the preparation of financial statements in accordance with applicable financial reporting standards. While Enthusiast Gaming 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 necessarily involve known and unknown risks, including, without limitation, risks associated with general economic conditions; adverse industry events; and future legislative, tax and regulatory developments. Readers are cautioned that the foregoing list is not exhaustive. For more information on the risks, uncertainties and assumptions that could cause anticipated opportunities and actual results to differ materially, please refer to the public filings of Enthusiast Gaming which are available on SEDAR at www.sedar.com. Readers are further cautioned not to place undue reliance on forward-looking statements as there can be no assurance that the plans, intentions or expectations upon which they are placed will occur. Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated. Forward-looking statements contained in this news release are expressly qualified by this cautionary statement and reflect our expectations as of the date hereof, and thus are subject to change thereafter. Enthusiast Gaming disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.

Neither the Toronto Stock Exchange nor its Regulation Services Provider (as that term is defined in the policies of the exchange) accepts responsibility for the adequacy or accuracy of this release.

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Disclaimer
All transaction are carrying out by SiLLC, a private portfolio management assembly. This document is not an offer of securities for sale or investment advisory services. This document contains general information only and is not intended to represent general or specific investment advice. Past performance is not a reliable indicator of future results and targets are not guaranteed. Certain statements and forecasted data are based on current expectations, current market and economic conditions, estimates, projections, opinions and beliefs of SiLLC and/or its members. Due to various risks and uncertainties, actual results may differ materially from those reflected or contemplated in such forward-looking statements or in any of the case studies or forecasts. All references to SiLLC’s advisory activities relates to SiLLC Assembly International.

Enthusiast Gaming Reports Preliminary Fourth Quarter 2021 Results

Enthusiast Gaming Reports Preliminary Fourth Quarter 2021 Results

Q4 2021 Revenue Expected at $56.9 Million, Year-over-Year Increase of 34%
2021 Annual Revenue Expected at $167.4 Million, Year-over-Year Increase of 130%

TORONTO, Feb. 08, 2022  — Enthusiast Gaming Holdings Inc. (“Enthusiast Gaming” or the “Company”) (NASDAQ:EGLX; TSX:EGLX), a media and content platform for video game and esports fans to connect and engage, is providing select preliminary unaudited financial results for the three months ended December 31, 2021 (“Q4 2021”).

The audited annual consolidated financial statements of the Company for the year ended December 31, 2021 (“the Financial Statements”), and related Management Discussion and Analysis (the “MD&A”) are expected to be released on March 24, 2022.

Financial Highlights:

  • Revenue in Q4 2021 is expected to be $56.9 million, representing a 34% increase from revenue for the three months ended December 31, 2020 (“Q4 2020”), of $42.5 million, resulting in expected annual revenue in 2021 of $167.4 million (2020 – $72.8 million).
  • Gross profit in Q4 2021 is expected to be $13.7 million, representing a 69% increase from gross profit in Q4 2020 of $8.1 million, resulting in expected annual gross profit in 2021 of $37.8 million (2020 – $18.7 million).
  • Gross margin in Q4 2021 is expected to be 24.1%, representing a 500 basis point increase from gross margin in Q4 2020 of 19.1%.
  • Direct sales in Q4 2021 are expected to be $8.8 million, representing a 167% increase from direct sales in Q4 2020 of $3.3 million, resulting in expected annual direct sales in 2021 of $22.2 million (2020 – $5.0 million). Direct sales are included in revenue.
  • Paid subscribers as at December 31, 2021, are expected to be 220,000, representing an 80% increase from paid subscribers as at December 31, 2020, of 122,000.
  • Cash balance as at December 31, 2021, is expected to be $22.7 million compared to $4.3 million as at December 31, 2020.

“These preliminary Q4 results again demonstrate the strength of our unique model, and show our momentum heading into 2022,” said Adrian Montgomery, CEO of Enthusiast Gaming. “We expect to have generated record quarterly revenues in the fourth quarter of 2021, led by our continued strength in direct sales, our ability to acquire and integrate assets such as Addicting Games and U.GG, our ability to attract and retain paying subscribers, and ultimately our flywheel of communities, creators, content, and experiences.”

“Q4 2021 revenue growth is expected to be strong at 34% year-over-year, but is outpaced by the expected gross profit growth of 69%. This is resulting in continued gross margin expansion,” said Alex Macdonald, CFO of Enthusiast Gaming. “Higher yield and higher margin revenue is core to our business model, and we continue to invest in operations that drive this type of growth.”

Fourth Quarter Operational Highlights:

  • Completion of the acquisition of League of Legends community U.GG, and expansion of the U.GG desktop app.
  • Renewals or additional business with key partners including Proctor & Gamble, HBO Max, TikTok, Disney, and Square Enix.
  • Record U.S. unique visitor traffic of 51.8 million recorded in December 2021 as measured by Comscore.
  • Expansion of in-game purchasing opportunities and subscription offerings for multiple Addicting Games titles including Little Big Snake, TypeRacer, ev.io, and mope.io.

The financial and operating results included in this news release are based on preliminary unaudited estimated results which have not yet been finalized or, in the case of annual results, audited, and will be updated and superseded by the Financial Statements and MD&A of the Company which are expected to be released on March 24, 2022. It is only in the context of the fulsome information and disclosures contained in the Financial Statements and MD&A that an investor can properly analyze this information. The Financial Statements and MD&A will be published under the Company’s profile on SEDAR and EDGAR.

All amounts are in Canadian dollars.

About Enthusiast Gaming

Enthusiast Gaming is building the largest media and content platform for video game and esports fans to connect and engage worldwide. Combining the elements of its four core pillars; Media, Talent, Esports, and Experiences, Enthusiast Gaming provides a unique opportunity and integrated approach to reach and connect with its coveted GenZ and Millennial audience. Through its proprietary mix of digital media and entertainment assets, Enthusiast Gaming has built a vast network of like-minded communities to deliver the ultimate fan experience.

Contacts

Enthusiast Gaming Investor Relations:
Eric Bernofsky, Chief Corporate Officer
investor@enthusiastgaming.com

Media Relations:
Derek Holota, Provident Communications
Derek@providentcomms.com
343-422-5606

Neither the Toronto Stock Exchange nor its Regulation Services Provider (as that term is defined in the policies of the exchange) accepts responsibility for the adequacy or accuracy of this release.

The estimated results contained herein are subject to change upon completion of the Financial Statements and the audit of such financial statements, and such changes could be material due to, among other things, the completion of the Company’s financial closing procedures, final adjustments, review by the Company’s auditors, and other developments that may arise between now and the time the financial results are finalized. Accordingly, such estimated results are forward-looking statements within the meaning of applicable securities legislation and are subject to the limitations and risks described under “Forward-Looking Statements” below.

Forward-Looking Statements

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 Enthusiast Gaming 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, the anticipated publishing date of the Company’s Financial Statements and MD&A, and statements regarding select preliminary unaudited estimated financial and operating results of the Company and balances relating to the financial position of the Company, as at and for the three months and year ended December 31, 2021, which will be updated and superseded by the Financial Statements and MD&A of the Company. These results and balances may prove to be incorrect and actual results may differ materially from those anticipated.

Forward-looking statements 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 esports and gaming media industry; the Company’s growth plan, and judgment applied in the application of the Company’s accounting policies and in the preparation of financial statements in accordance with applicable financial reporting standards. While Enthusiast Gaming 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 necessarily involve known and unknown risks, including, without limitation, risks associated with general economic conditions; adverse industry events; and future legislative, tax and regulatory developments. Readers are cautioned that the foregoing list is not exhaustive. For more information on the risks, uncertainties and assumptions that could cause anticipated opportunities and actual results to differ materially, please refer to the public filings of Enthusiast Gaming which are available on SEDAR at www.sedar.com. Readers are further cautioned not to place undue reliance on forward-looking statements as there can be no assurance that the plans, intentions or expectations upon which they are placed will occur. Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated. Forward-looking statements contained in this news release are expressly qualified by this cautionary statement and reflect our expectations as of the date hereof, and thus are subject to change thereafter. Enthusiast Gaming disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.

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Disclaimer
All transaction are carrying out by SiLLC, a private portfolio management assembly. This document is not an offer of securities for sale or investment advisory services. This document contains general information only and is not intended to represent general or specific investment advice. Past performance is not a reliable indicator of future results and targets are not guaranteed. Certain statements and forecasted data are based on current expectations, current market and economic conditions, estimates, projections, opinions and beliefs of SiLLC and/or its members. Due to various risks and uncertainties, actual results may differ materially from those reflected or contemplated in such forward-looking statements or in any of the case studies or forecasts. All references to SiLLC’s advisory activities relates to SiLLC Assembly International.

Enthusiast Gaming and Torstar to Launch GenZ-Focused Online News Channel

Enthusiast Gaming and Torstar to Launch GenZ-Focused Online News Channel

AFK will combine Enthusiast Gaming’s GenZ expertise and audience with the leading content capabilities of Torstar

 

TORONTO, July 07, 2021 — Enthusiast Gaming Holdings Inc. (“Enthusiast Gaming” or the “Company”) (NASDAQ:EGLX) (TSX:EGLX), a media and content platform for video game and esports fans to connect and engage, today announced it has entered into a joint venture with Torstar Corporation (“Torstar”) to create an original online news platform and community named AFK (“AFK”).

“We’re thrilled to partner with Torstar on the launch of a channel that will combine our expertise in building engaged online communities with Torstar’s commitment to quality content,” said Adrian Montgomery, CEO of Enthusiast Gaming.

AFK is a new brand that brings insight and community to issues that matter to gamers in a tone and format that feels familiar to them, such as short-form video content and message boards on digital-first platforms,” added Jordan Bitove, co-proprietor of Torstar.

In anticipation of its debut on YouTube, AFK will launch a crowd-sourced contest titled “Find a Host”. The contest will invite entrants to submit video auditions around one of four relevant topics: the environment, social issues, economic issues, and cultural trends.

AFK judges will pick six finalists for a series of challenges throughout the summer. The winner will be announced in a live event in September 2021 and offered a full-time hosting position at AFK, with the official launch of the publication expected in the fall of 2021.

About Enthusiast Gaming

Enthusiast Gaming is building the largest media and content platform for video game and esports fans to connect and engage worldwide. Combining the elements of its four core pillars; Media, Talent, Esports and Experiences, Enthusiast Gaming provides a unique opportunity and integrated approach to reach and connect with its coveted GenZ and Millennial audience. Through its proprietary mix of digital media and entertainment assets, Enthusiast Gaming has built a vast network of like-minded communities to deliver the ultimate fan experience.

About Torstar

Torstar is a holding company with investments, primarily in news and media.  Businesses in the group include the Toronto Star and numerous other city and community news organizations. Other investments include VerticalScope, Canadian Press, iPolitics, Blue Ant Media, Sing Tao, LeaseBusters and Metroland Parcel Delivery services.

Contacts

Investor Relations:
Eric Bernofsky, Chief Corporate Officer, Enthusiast Gaming
investor@enthusiastgaming.com

Media Relations:
Carmela Antolino, Provident Communications
carmela@providentcomms.com
647-287-2286

Neither the TSX Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Exchange) accept responsibility for the adequacy or accuracy of this release.

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 Enthusiast Gaming 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 regarding: new product initiatives of the Company through a joint venture with a third party, the timing and completion of the development of future products, the functionality of future products, and planned marketing initiatives for future products.

Forward-looking statements 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 esports and media industry; and the Company’s growth plan. While Enthusiast Gaming 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 necessarily involve known and unknown risks, including, without limitation, risks associated with general economic conditions; the timing and filing of the final base shelf prospectus and corresponding Registration Statement; the potential offering of any Securities by the Company; uncertainty with respect to the completion of any future offering; the ability to obtain applicable regulatory approvals for any contemplated offerings; the ability of the Company to negotiate and complete future funding transactions; adverse industry events; and future legislative, tax and regulatory developments. Readers are cautioned that the foregoing list is not exhaustive. For more information on the risk, uncertainties and assumptions that could cause anticipated opportunities and actual results to differ materially, please refer to the public filings of Enthusiast Gaming which are available on SEDAR at www.sedar.com. Readers are further cautioned not to place undue reliance on forward-looking statements as there can be no assurance that the plans, intentions or expectations upon which they are placed will occur. Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated. Forward-looking statements contained in this news release are expressly qualified by this cautionary statement and reflect our expectations as of the date hereof, and thus are subject to change thereafter. Enthusiast Gaming disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.

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Disclaimer
All transaction are carrying out by SiLLC, a private portfolio management assembly. This document is not an offer of securities for sale or investment advisory services. This document contains general information only and is not intended to represent general or specific investment advice. Past performance is not a reliable indicator of future results and targets are not guaranteed. Certain statements and forecasted data are based on current expectations, current market and economic conditions, estimates, projections, opinions and beliefs of SiLLC and/or its members. Due to various risks and uncertainties, actual results may differ materially from those reflected or contemplated in such forward-looking statements or in any of the case studies or forecasts. All references to SiLLC’s advisory activities relates to SiLLC Assembly International.


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