Nektan plc (LON:NKTN) Chief Executive Officer David Gosen caught up with DirectorsTalk for an exclusive interview to discuss their £8 million financing, their partnership with News UK for The Sun’s new gaming app Sun Play and their plans going forward.
Q1: We saw last week that Nektan have secured £8 million in new financing, how does this support Nektan’s business and strategy for the UK, Europe and the US?
A1: Nektan operates in the real money gaming space on mobile and we’re a content developer and also a player platform provider. We’re operating in possible one of the most exciting spaces that exists in terms of the mobile space and many people will be aware that specifically in the UK, smartphone penetration is now fast approaching 70% and has already changed the way people consume entertainment and music and communications and it’s going to do the same for the gambling market as well. What we see is that mobile is the driving force behind that and in our business we’ve seen exceptionally strong momentum in partners coming on board saying we would like to engage with our audiences through mobile, through real money gaming. We have 16 live partners in the UK, which is a critical part of the European business, and in the US we’re working with land based casinos with an in-venue mobile tech solution. What this funding does is it allows us to build on that very strong momentum and underpin that growth strategy in the US and Europe to continue to build the real money gaming business in a B2B way with our partners and also to continue to grow in the US. It strengthens our balance sheet and really gives us the fuel that we need to continue to drive incredibly fast in those two specific regions.
Q2: We have seen today that you’ve launched in partnership with News UK and that’s for Sun Play for The Sun newspaper. How important is this for the business?
A2: Our relationship with The Sun is absolutely critical, not only to Nektan but also for News UK and The Sun as well because when we pitched for this business and they chose Nektan, they chose us because of our creativity and our innovation and the understanding of some of the challenges that they have as a newspaper. Clearly they are trying to find new ways to engage with their audience and they also have a very engaged digital audience and our partnership with them is all about helping them to build those relationships that they have with their customers that makes them more enriching and far deeper and also clearly it’s a revenue opportunity. For us, it is critical given the size and scale of The Sun in the UK that we were chosen to provide a real money gaming solution for them but also, in a very creative way, to create a set of skill games that are bespoke and exclusive to The Sun that are built on some of their franchises. What that enables us to do is appeal to the very broad audience that The Sun have, whether in print or online.
Q3: How does this underpin your business growth in the European Gaming market?
A3: Well clearly having a partner like The Sun is going to be a significant contributor to our business and this is a multi-year contract that we have with The Sun. We will continue to work with them and deliver new content to their readers on a regular basis so today marks the start of the journey and a very exciting one with the two skill games, with two exclusive cash games and other games for their readers to play. We will be bringing more innovative content over the coming years to The Sun and to their readers.
Q4: Finally, what should investors be looking out for in terms of news flow over the next few months?
A4: We will continue to bring new partners on board in the business to business white label space in Europe because we’re finding that certain media companies and companies with significant audiences are looking at ways that they can engage with their viewers or their readers in innovative ways so we will continue to recruit new partners that want to work with us to help them deliver that relationship, that deep relationship with their customers. In the US, once again is a critical part of our growth strategy where we are working with the land based casinos, we have 18 contracts or letters of intent currently with those casinos for us to deploy our product with them. We see again continued momentum in that market and continued excitement on behalf of the casinos as we put our products into their venues to help them increase the amount of money or coin-in, as they call it, that consumers put into the slot machines. My expectation is that you’ll continue to see us announce some very important contracts on both sides of the Atlantic.
