NetDragon Announces 2022 Interim Financial Results

Achieved Record Growth for Education Business with Revenue Up 71.2% YoY

NetDragon Websoft Holdings Limited ("NetDragon" or the "Company"; Hong Kong Stock Code: 777), a global leader in building internet communities, today announced its financial results for the first half of 2022. NetDragon's management team will hold a webcast at 10:00am Hong Kong time on 31st August 2022 to discuss the results and recent business development.

Dr. Dejian Liu , Chairman of NetDragon, commented, "We continued to make significant progress across our business in the first half of 2022 as our revenue increased by 26.3% YoY to RMB4.2 billion and net profit attributable to owners of the Company increased by 31.2% YoY to RMB565.1 million . Our achievement is made possible by solid commercial execution, as well as years of investment in our product R&D, global sales network and most importantly our people to maintain our overall operational competencies at the highest level."

"Our education business delivered a record growth performance in the first half. We continued to see countries around the world accelerating their adoption of edtech with an ever-growing emphasis on blended learning in K12 classrooms. As the global market leader, we continued to innovate and drive positive, sustained impact on teachers and students. As a result, we further expanded our leadership position by increasing our market share in the first half, and delivered an exceptional performance with 71.2% YoY growth in education revenue. In addition, we stepped up our effort in pursuing partnerships and potential M&A opportunities to monetize our Promethean platform with software and SAAS applications."

"In China, the resurgence of Covid-19 cases has led to challenges in the economy which inevitably affected consumer sentiment and spending power, and as a result impacted our gaming revenue during the first half. Despite the near-term challenges, we continued to focus on executing our long-term growth plan by actively building our pipeline of new games, driving players' engagement level and expanding our base of paying users of our existing games. We are also excited by the quality of our pipeline. We are developing several new games under the Eudemons IP that will continue to drive the long-term revenue growth of this legendary IP, and we are also actively expanding into new IPs, new genres, and the overseas markets."

"We are committed to following through on our capital return commitment to maximize value for our shareholders. To that end, we are pleased to announce that the Board declared a special interim dividend of HK$0.50 and an interim dividend of HK$0.40 per ordinary share for the first half of 2022. Meanwhile, we will continue to operate our business with a strong financial position with RMB3.5 billion in net cash as of June 30, 2022 , which will enable us to capitalize on future acquisition, investment and strategic opportunities."

2022 First Half Financial Highlights

Revenue was RMB4.2 billion , representing a 26.3% increase YoY.
Revenue from the education business was RMB2.4 billion , representing 56.8% of the Group's total revenue and registering a 71.2% increase YoY.
Revenue from the games business was RMB1.8 billion , representing 41.9% of the Group's total revenue and registering a 3.9% decrease YoY.
Gross profit was RMB2.3 billion , representing a 4.0% increase YoY.
Core segmental profit ^[1] from the games business was RMB1.0 billion , representing a 6.2% decrease YoY.
Core segmental loss ^[1] from the education business was RMB35.7 million , representing an 86.1% improvement YoY.
Operating Profit was RMB744.6 million , representing a 7.7% increase YoY.
Non-GAAP operating profit ^[2] was RMB854.4 million , representing a 13.3% increase YoY.
EBITDA was RMB877.5 million , representing an 1.6% decrease YoY.
Non-GAAP EBITDA ^[2] was RMB1.0 billion , representing an 11.2% increase YoY.
Profit attributable to owners of the Company was RMB565.1 million , representing a 31.2% increase YoY.
Non-GAAP profit attributable to owners of the Company ^[2] was RMB815.8 million , representing a 44.0% increase YoY.
The Company declared a special interim dividend and an interim dividend of HK$0.50 and HK$0.40 per ordinary share respectively, for the six months ended 30 June 2022 .

Segmental Financial Highlights

	2022 First Half		2021 First Half		Variance
(RMB '000)	Gaming	Education	Gaming (Restated)	Education (Restated)	Gaming	Education
Revenue	1,775,729	2,409,818	1,847,548	1,407,641	-3.9 %	71.2 %
Gross Profit	1,699,076	609,687	1,765,923	431,055	-3.8 %	41.4 %
Gross Margin	95.7 %	25.3 %	95.6 %	30.6 %	+0.1 ppts	-5.3 ppts
Core Segmental Profit (Loss) ^[1]	1,006,454	(35,672)	1,073,223	(256,327)	-6.2 %	-86.1 %
Segmental Operating Expenses ^[3]
- Research and development	(353,308)	(225,712)	(322,611)	(272,141)	9.5 %	-17.1 %
- Selling and marketing	(187,531)	(252,210)	(200,100)	(235,190)	-6.3 %	7.2 %
- Administrative	(152,373)	(177,033)	(170,948)	(172,155)	-10.9 %	2.8 %

^[1] Core segmental profit (loss) figures are derived from the Company's reported segmental profit (loss) figures (presented in accordance with Hong Kong Financial Reporting Standard ("HKFRS") 8) but exclude non-core/operating, non-recurring or unallocated items including government grants, intercompany finance costs, impairment loss (net of reversal), impairment loss of intangible assets, inventories and interest in an associate, fair value change and exchange difference on financial assets at fair value through profit or loss ("FVTPL"), fair value change and exchange difference on derivative financial instruments, interest expense and exchange difference on convertible and exchangeable bonds and redundancy payment.

^[2] To supplement the consolidated results of the Group prepared in accordance with HKFRSs, the use of non-GAAP measures is provided solely to enhance the overall understanding of the Group's current financial performance. The non-GAAP measures are not expressly permitted measures under HKFRSs and may not be comparable to similarly titled measures for other companies. The non-GAAP measures of the Group exclude share-based payments expense, amortisation of intangible assets arising on acquisitions of subsidiaries, impairment loss of intangible assets, inventories and interest in an associate, fair value change on financial assets at FVTPL, fair value change on derivative financial instruments, finance costs, interest income on pledged bank deposits and exchange difference on financial assets at FVTPL, bank borrowings, convertible and exchangeable bonds and derivative financial instruments.

^[3] Segmental operating expenses exclude unallocated expenses/income such as depreciation, amortisation and exchange difference that have been grouped into SG&A categories on the Company's reported consolidated financial statements, but cannot be allocated to specific business segments for purpose of calculating the segmental profit (loss) figures in accordance with HKFRS 8.

Education Business

Our education business achieved a record growth rate as its revenue in the first half increased by 71.2% YoY, reaching RMB2.4 billion . Core segmental loss narrowed to RMB35.7 million as we benefit from strong operating leverage and disciplined cost management measures.

We continued to benefit from the accelerating global trend of edtech adoption and the growing emphasis on blended learning. And it has become increasingly clear that IFPD (interactive flat panel displays) is a necessity in every K12 classrooms, without which blended learning is not possible. As a result, the industry saw a phenomenal 71.5% YoY growth in shipment volume of IFPD in the international market during the first half of 2022 ^[4] . As the global market leader in IFPD, we continued to capitalize on the market momentum by delivering 82.5% YoY and 46.9% HoH growth in our volume shipment of IFPD. Not only did we hold the number-one market share globally, we also expanded our market share by 4.1 ppts HoH to 26.0% in the first half ^[5] . We continued to win in the market as we increased our market share in all of our Top 5 countries by revenue contribution, namely the U.S., Italy , the U.K., Germany and France .

Our gross margin for the education business saw a decline from 30.6% to 25.3% YoY due to higher material and freight cost, and a 4.3% YoY reduction in ASP as we sold down inventory of ActivPanel 7 in anticipation of our new ActivPanel 9 product launch in June. Since the second half of 2021, we have seen materials cost and freight cost trending down as global supply chain challenges started to ease, and as we continued to implement best practice measures on cost management, we have seen margin improvement on a sequential basis. Excluding the tariff impact, our adjusted gross margin for our key subsidiary Promethean increased by 1.3 ppts HoH from 28.6% to 29.9% in the first half of 2022.

We reached a major milestone in product innovation during the first half as Promethean introduced the all-new ActivPanel 9 in June to deliver transformational user experience with enhanced simplicity, connectivity, security, adaptability, and longevity to address the key needs of the educators in a hybrid learning environment. Shipment has started since the official launch, and we expect the new model to continue to drive our future revenue growth. We also stepped up our effort in exploring for software monetization opportunities for our Promethean platform. In June, Promethean entered into a US-based exclusive distribution agreement with leading education AI technology company Merlyn Mind as our first step to leverage our sales network to expand beyond hardware sales into SaaS solutions. At the same time, we are actively pursuing M&A opportunities with the intention to plug in ready-to-monetize software tools into our Promethean platform.

We continued to develop traction with our B2G country-rollout strategy. In Egypt , shipment for the definitive contract signed in Q1 (to supply 94,000 Promethean panels to K-12 schools around the country) is expected to commence in the second half of this year. In China , our priority is focused on our partnership with the National Center for Education Technology ("NCET"), a unit directly under the National Ministry of Education in China , in building the National K-12 Smart Education Platform. Since the launch of this platform on 1st March, the average daily page-view exceeded 40 million and number of registered users reached 21 million, as more and more regions within China are starting to adopt the platform.

Looking forward, we expect 2022 to be a year of exceptional growth. With our new ActivPanel 9, our expanded market leadership position and our operational capability, we believe we are in a strong position to capitalize on the opportunities ahead.

^[4] Based on Futuresource Consulting Q2 2022 World Interactive Displays Report in Aug 2022. International market refers to global K-12 interactive panel market excluding China.

^[5] Market share of global K-12 interactive panel market excluding China

Gaming Business

Revenue of our gaming business decreased by 3.9% YoY to RMB1.8 billion in the first half of 2022, as the macro-economic impact in China has led to more conservative players' spending across our domestic games. Revenue from our PC games decreased by 5.2% YoY due to a relatively larger high-spending players' cohort, while revenue from our mobile games increased by 3.1% YoY.

Revenue from our flagship IP Eudemons decreased by 0.6% HoH and 3.8% YoY. While players' spending has been affected in the short term, we put our focus on driving players' engagement and expanding our paying user base. We launched four expansion packs for our Eudemons games during the first half, and have conducted multiple in-game events and campaigns to drive activities, leading to YoY increase in both MAU and APA (Average Paying Accounts) for the IP. In particular, despite the macro impact on revenue, our Eudemons PC game registered a 34% YoY increase in MAU and a 65% YoY increase in APA. Eudemons Pocket Version , our game with the highest mobile revenue contribution, also delivered a resilient performance with a 7.8% YoY increase in revenue. In addition, we continued to make progress with expanding the influence of the Eudemons IP on the pan-entertainment front by launching its first ever stage play Eudemons Light of Yate in August.

Our Conquer IP delivered stable revenue growth on the back of two expansion packs launched in the first half and our continuous effort to innovate with new gameplay and contents. We continued to focus on expanding the overseas markets for the Conquer IP, and while we maintained a 20.8% YoY gross billings growth in our core market in Egypt , our gross billings from outside of Egypt increased by 57.7% YoY.

We continued to make progress with our new gaming pipeline. In July 2022 , we achieved a key milestone for our Under Oath IP as we reached agreement with a renowned global 3A game publisher to launch the overseas game version of this IP in multiple countries starting next year. In addition, we are also excited about the alpha launch of our first Web3 game Neopets Metaverse in August, as we stay on track to bring this popular IP with over 150 million registered users to the Web3 space.

Looking forward, we expect to beta-launch Eudemons Mobile 2 and Neopets Faerie's Hope in the second half of this year, and on top of those, we have a solid pipeline of new games lining up for 2023 and beyond. On the macro side, as China inevitably recovers from the Covid-related economic slowdown and as the gaming industry in China continues to trend towards a positive direction, we believe our gaming business is well positioned to achieve long-term sustainable growth.

Management Conference Call and Webcast

NetDragon's management team will hold a conference call and webcast at 10:00am Hong Kong time on 31st August 2022 to discuss the results and recent business developments.

Details of the live conference call are as follows:

International	+852 3008 3269
Mainland China	400 856 2291
HK (China)	+852 3008 3269
US	+1 800 387 6988
UK	0800 029 1098
Passcode	908146263

A live and archived webcast of the conference call will be available on the Investor Relations section of NetDragon's website at https://ir.nd.com.cn/en/category/webcast . Participants in the live webcast should visit the aforementioned website 10 minutes prior to the call, then click on the icon for "2022 Interim Results Conference Call and Webcast" and follow the registration instructions.

About NetDragon Websoft Holdings Limited

NetDragon Websoft Holdings Limited (HKSE: 0777) is a global leader in building internet communities with a long track record of developing and scaling multiple internet and mobile platforms that impact hundreds of millions of users, including previous establishments of China's first online gaming portal, 17173.com, and China's most influential smartphone app store platform, 91 Wireless.

Established in 1999, NetDragon is one of the most reputable and well-known online game developers in China with a history of successful game titles including Eudemons Online , Heroes Evolved , Conquer Online and Under Oath . In recent years, NetDragon has also started to scale its online education business on the back of management's vision to create the largest global online learning community, and to bring best-in-class integrated blended learning solutions to every school around the world.

CONDENSED CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
FOR THE SIX MONTHS ENDED 30 JUNE 2022

	Six months ended 30 June
	2022	2021
	(Unaudited)	(Unaudited)
	RMB'000	RMB'000
Revenue	4,240,381	3,356,174
Cost of revenue	(1,917,600)	(1,122,299)

Gross profit	2,322,781	2,233,875
Other income and gains	43,724	86,859
Impairment loss under expected credit loss model, net of reversal	(9,201)	(4,237)
Selling and marketing expenses	(442,111)	(437,997)
Administrative expenses	(464,017)	(485,206)
Development costs	(585,690)	(594,854)
Other expenses and losses	(112,123)	(94,341)
Share of losses of associates and joint ventures	(8,751)	(12,464)

Operating profit	744,612	691,635
Interest income on pledged bank deposits	-	819
Exchange (loss) gain on financial assets at fair value through profit or loss, bank borrowings, convertible and exchangeable bonds and derivative financial instruments	(41,836)	7,522
Net (loss) gain on financial assets at fair value through profit or loss	(31,728)	12,052
Fair value gain (loss) on derivative financial instruments	7,851	(21,319)
Finance costs	(99,263)	(91,039)

Profit before taxation	579,636	599,670
Taxation	(37,601)	(216,042)

Profit for the period	542,035	383,628

Other comprehensive income (expense) for the period, net of income tax:
Item that may be reclassified subsequently to profit or loss:
Exchange differences arising on translation of foreign operations	16,713	(3,403)
Item that will not be reclassified to profit or loss:
Fair value loss on equity instruments at fair value through other comprehensive income	(841)	(2,504)
Other comprehensive income (expense) for the period	15,872	(5,907)
Total comprehensive income for the period	557,907	377,721

Profit (loss) for the period attributable to:
- Owners of the Company	565,114	430,732
- Non-controlling interests	(23,079)	(47,104)
	542,035	383,628

Total comprehensive income (expense) attributable to:
- Owners of the Company	581,858	425,338
- Non-controlling interests	(23,951)	(47,617)
	557,907	377,721

	*RMB cents*	RMB cents
Earnings per share
- Basic	104.42	77.45
- Diluted	104.40	77.39

CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2022

	30 June 2022	31 December 2021
	(Unaudited)	(Audited)
	RMB'000	RMB'000
Non-current assets
Property, plant and equipment	1,924,889	1,939,499
Right-of-use assets	396,800	428,278
Investment properties	79,757	77,062
Intangible assets	716,479	772,309
Interests in associates and joint ventures	41,345	50,096
Equity instruments at fair value through other comprehensive income	57,331	8,105
Financial assets at fair value through profit or loss	339,633	266,078
Loan receivables	4,887	8,220
Other receivables, prepayments and deposits	64,427	37,543
Deposits made for acquisition of property, plant and equipment	6,894	4,690
Goodwill	228,518	217,087
Deferred tax assets	248,240	135,076
	4,109,200	3,944,043
Current assets
Properties under development	307,753	316,872
Properties for sale	278,582	205,273
Inventories	733,134	685,117
Loan receivables	7,507	22,207
Trade receivables	972,352	831,986
Other receivables, prepayments and deposits	415,724	481,455
Contract assets	15,199	11,692
Amounts due from joint ventures	2,498	2,945
Tax recoverable	27,098	25,273
Financial assets at fair value through profit or loss	1,414	1,852
Restricted bank balances	-	7,828
Pledged bank deposits	1,099	1,047
Bank deposits with original maturity over three months	200,000	630,000
Bank balances and cash	3,701,808	3,717,246
	6,664,168	6,940,793

Current liabilities
Trade and other payables	1,387,566	1,455,221
Contract liabilities	327,393	357,240
Lease liabilities	61,513	63,571
Provisions	82,097	88,784
Derivative financial instruments	36,442	42,565
Amount due to an associate	-	936
Bank borrowings	443,152	402,910
Convertible and exchangeable bonds	15,583	15,000
Dividend payables	184,975	-
Tax payable	124,375	127,882
	2,663,096	2,554,109

Net current assets	4,001,072	4,386,684
Total assets less current liabilities	8,110,272	8,330,727

Non-current liabilities
Other payables	15,483	10,763
Convertible and exchangeable bonds	1,194,081	1,069,874
Convertible preferred shares	-	-
Lease liabilities	69,519	95,370
Deferred tax liabilities	80,481	80,111
	1,359,564	1,256,118

Net assets	6,750,708	7,074,609

Capital and reserves
Share capital	39,467	39,795
Share premium and reserves	6,980,105	7,274,605

Equity attributable to owners of the Company	7,019,572	7,314,400
Non-controlling interests	(268,864)	(239,791)
	6,750,708	7,074,609

UNAUDITED RECONCILIATION OF GAAP AND NON-GAAP RESULTS

	Six months ended 30 June
	2022	2021
	(Unaudited)	(Unaudited)
	RMB'000	RMB'000
Operating profit	744,612	691,635
Share-based payments expense	2,803	6,673
Amortisation of intangible assets arising on acquisitions of subsidiaries	27,408	33,010
Impairment loss of intangible assets and interest in an associate	55,215	22,570
Impairment loss of inventories	24,396	-
Non-GAAP operating profit	854,434	753,888

Profit attributable to owners of the Company	565,114	430,732
Share-based payments expense	2,802	6,670
Amortisation of intangible assets arising on acquisitions of subsidiaries	21,257	25,038
Impairment loss of intangible assets and interest in an associate	54,899	20,339
Impairment loss of inventories	22,041	-
Exchange loss (gain) on financial assets at fair value through profit or loss, bank borrowings, convertible and exchangeable bonds and derivative financial instruments	36,130	(6,480)
Finance costs ^[6]	89,903	82,423
Net loss (gain) on financial assets at fair value through profit or loss	31,544	(12,505)
Fair value (gain) loss on derivative financial instruments	(7,851)	21,319
Interest income on pledged bank deposits	-	(819)
Non-GAAP profit attributable to owners of the Company	815,839	566,717

^[6] Substantially non-cash

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SOURCE NetDragon Websoft Holdings Limited

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NorthStar Gaming Announces Revocation of Management Cease Trade Order

NorthStar Gaming Holdings Inc. (TSXV: BET) (OTCQB: NSBBF) ("NorthStar" or the "Company") is pleased to announce that effective May 16, 2025, the Ontario Securities Commission has revoked the temporary management cease trade order ("MCTO") it had previously granted to the Company on May 8, 2025 under National Policy 12-203 Management Cease Trade Orders, as the Company successfully completed the filing of its annual audited financial statements, management's discussion and analysis, and related certifications for the year ended December 31, 2024 (collectively, the "Annual Filings") on May 14, 2025.

The revocation of the MCTO means members of management are no longer prevented from trading the Company's securities. All of the Annual Filings are available under the Company's profile on SEDAR+ at www.sedarplus.ca.

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NorthStar Gaming Reports Year-End 2024 Results

Annual Revenue Growth of 57%, Gross Margin up 91%

NorthStar Gaming Holdings Inc. (TSXV: BET) (OTCQB: NSBBF) ("NorthStar" or the "Company") today announced its financial results for the three months and year ended December 31, 2024. The Company also announced that it will discuss the results on an investor webinar to be held Thursday, May 15, 2025 at 11:00am (please see below for details). All dollar figures are quoted in Canadian dollars.

"We delivered strong financial results in 2024, highlighted by 57% growth in revenue and a 91% increase in gross margin. At the same time, we held marketing expense to a 10% increase and reduced G&A expense, demonstrating the continually improving operating leverage built into our business model," said Michael Moskowitz, Chair and CEO of NorthStar. "Equally important, our team rolled out innovations in both our sportsbook and casino that have further differentiated NorthStar Bets as a premium offering and helped drive the retention of, and engagement with, our loyal customers."

Restatement of Results

The comparative results for the three months and twelve months ended December 31, 2023 have been restated in the financial statements and management's discussion & analysis ("FY2024 MD&A") for the year ended December 31, 2024 to include additional merchant fees and player bonus expenses which were not captured in the previously published financial statements (note 2 of the Financial Statements for the year ended December 31, 2024). The Company's payment processor deducted the additional merchant fee from the daily remittances to the Company, and the deductions were not accounted for by the Company. These additional fees were identified as part of the year-end reconciliation of the amount due from the payment processor, and the financial statements and FY2024 MD&A have been adjusted accordingly. These restatements did not impact the cash balances reported for the years ended December 31, 2022, 2023, or 2024. However, they did result in adjustments to the reported current asset balances for those periods.

Financial Highlights for the Fourth Quarter Ended December 31, 2024 ("Q4 2024"):

Total Wagers¹ at Northstarbets.ca were $303.0 million in Q4 2024, a 42% increase compared to $213.3 million in Q4 2023.
Gross Gaming Revenue² at Northstarbets.ca was $10.0 million in Q4 2024, a 31.6% increase from $7.6 million in Q4 2023.
Revenue² was $9.5 million in Q4 2024, a 51% increase from $6.3 million in Q4 2023. Revenue in Q4 2024 includes $1.5 million of managed services revenue, which compares to $0.2 million in Q4 2023.
Gross Margin was $3.6 million, a 71% increase from $2.1 million in Q4 2023, while the Gross Margin percentage increased to 38.1%, up from 33.6% in Q4 2023.
Profit/(loss) before marketing and other expenses¹ was $0.6 million in Q4 2024 compared to a loss of $2.5 million in Q4 2023, indicating that gross margin is now sufficient to cover the Company's overhead expenses.

Financial Highlights for the Year Ended December 31, 2024 ("FY 2024"):

Total Wagers² at Northstarbets.ca were $980.0 million in FY 2024, a 51% increase compared to $648.8 million in the year ended December 31, 2023.
Gross Gaming Revenue² at Northstarbets.ca was $34.0 million in FY 2024, a 51% increase from $22.5 million in FY 2023.
Revenue² was $29.6 million in FY 2024, a 57% increase from $18.8 million in FY 2023. Revenue in FY 2024 includes $2.3 million of managed services revenue, which compares to $0.5 million in FY 2023.³
Gross Margin was $10.5 million, marking a 91% increase from $5.5 million in FY 2023, with the Gross Margin increasing to 35.7%, up from 29.3% in FY 2023.
Profit/(loss) before marketing and other expenses¹ was $0.1 million in FY 2024 compared to a loss of $6.7 million in YTD 2023, an improvement of $6.8 million.

"Early in 2025, we completed our most significant fund-raising to date, with a $43.4 million debt financing. This capital gives us a long runway on which to continue our trajectory of growth in wagering, gross margins and improving operating leverage. This was a milestone event for our business," added Mr. Moskowitz.

2024 Operating Highlights:

Completed the inaugural Blackjack Championship tournament, an innovative online competition that helped drive the acquisition of new high-value players and engagement for existing customers while increasing Blackjack wagering activity.
Implemented a series of enhancements to the NorthStar Bets platform, highlighted by streamlined navigation in both the Casino and Sportsbook sections, a doubling of Casino game selection since the start of 2024, personalized prop bets and intelligent parlay suggestions.
Introduced the "NorthStar Elite" program and branded tables to help secure the loyalty and satisfaction of our most active players and reinforcing the Company's positioning as a premium offering.
Launched "Sports Insights 2.0," a robust suite of enhancements to our content vertical that includes a redesigned home page, comprehensive team and player statistics, injury and player news feeds, added coverage of popular sports and strengthened casino content.
Gained significant traction outside the Ontario market with managed services revenue from Northstarbets.com site, owned by the Abenaki Council of Wolinak, increasing from $0.5 million in FY 2023 to $2.3 million in FY 2024.
Outpaced the industry growth rates reported by iGaming Ontario in 2024 in both Total Wagers (51% for NorthStar vs. 33% for the industry) and Gross Gaming Revenue (51% for NorthStar vs. 31.5% for the industry).

Outlook

"We expect our consistent pattern of year-over-year revenue increases to continue throughout 2025, based on our ongoing success in attracting and engaging high-value players," said Mr. Moskowitz. "We will maintain disciplined control over costs so that incremental gross margin falls primarily to the bottom line. As we continue to focus on operational excellence, we remain confident that we have the capital necessary to reach profitability based on our current business platform."

FY 2024 Corporate Update Webinar

On May 15, 2025, Michael Moskowitz will present an in-depth Corporate Update, including a discussion of the Company's FY 2024 Earnings, current operations and strategic priorities. All investors and other interested parties are invited to register for the webinar at the link below.

Date: Thursday, May 15, 2025
Time: 11:00 am EDT
Register: Webinar Registration

Management will be available to answer your questions following the presentation on the webinar platform. You may also submit your question(s) beforehand in the registration form linked above.

Extension of Strategic Marketing Agreement

The Company also announced that its wholly owned subsidiary, NorthStar Gaming (Ontario) Inc. ("NorthStar Ontario"), has extended its strategic partnership with Playtech Software Limited ("Playtech Software") through the renewal of their previously announced strategic marketing agreement. Under the agreement, Playtech Software contributes services designed to accelerate NorthStar Ontario's player acquisition strategy in the province. The agreement was first implemented in June 2023 and has since been renewed several times. Pursuant to the latest renewal, Playtech Software will reimburse marketing expenses valued at a total of up to $1.5 million over a 3-month period through to March 31, 2025. Playtech Software will be compensated through a share of revenue from the income generated in connection with the marketing initiatives to which it contributes. The Transaction between Playtech and NorthStar Ontario is exempted from Multilateral Instrument 61-101 Protection of Minority Securityholders in Special Transactions.

"We are very pleased to renew the marketing services agreement with Playtech Software," said Michael Moskowitz, Chair and CEO of NorthStar. "The agreement serves to extend our marketing budget and has contributed to our tremendous growth in Ontario. Playtech plc continues to be a valuable strategic partner and we look forward to further collaboration."

Continuous Disclosure

Further to a review by the staff of the Ontario Securities Commission (the "OSC") of the Company's continuous disclosure, the FY2024 MD&A includes enhanced disclosures with respect to:

the Company's regulatory framework, licensing regimes applicable to its business operations and the legal authorizations necessary to conduct its business operations;
specific risk factors relating to the Company's business operations which include risks relating to operating in a heavily regulated industry, cyber security risks and risks relating to conflicts of interest with respect to directors and officers of the Company; and
the relationship between the Abenaki Council of Wolinak and the Company as well as its subsidiary, Slapshot Media Inc.

Such amended disclosure is being included in the FY2024 MD&A to address comments received from the OSC on its management's discussion & analysis, for the period ended September 30, 2024, and to improve the Company's disclosure.

As a result of having to include such enhanced disclosure after the OSC review, the Company will be placed on the public list of Refilings and Errors in accordance with OSC Staff Notice 51-711 (Revised) - Refilings and Corrections of Errors for a period of three (3) years.

Additional Information

For additional information, please refer to the Company's condensed consolidated financial statements for the year ended December 31, 2024, and the corresponding FY2024 MD&A. These documents are available on SEDAR+ at www.sedarplus.ca, and on the Company's corporate website at www.northstargaming.ca.

About NorthStar

NorthStar proudly owns and operates NorthStar Bets, a Canadian-born casino and sportsbook platform that delivers a premium, distinctly local gaming experience. Designed with high-stakes players in mind, NorthStar Bets Casino offers a curated selection of the most popular games, ensuring an elevated user experience. Our sportsbook stands out with its exclusive Sports Insights feature, seamlessly integrating betting guidance, stats, and scores, all tailored to meet the expectations of a premium audience.

As a Canadian company, NorthStar is uniquely positioned to cater to customers who seek a high-quality product and an exceptional level of personalized service, setting a new standard in the industry. NorthStar is committed to operating at the highest level of responsible gaming standards.

No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein. Neither the TSX Venture Exchange ("TSXV") nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this press release.

Non-IFRS Financial Measures [/ Reconciliation of Non-IFRS Measures to IFRS Measures]

Throughout this document, management uses certain non-IFRS financial measures and supplementary financial measures to evaluate the performance of the Company. The terms "Gross Gaming Revenue" "Total Wagers" and "Profit/(Loss) before marketing and other expenses" are non-IFRS financial measures. These measures are not recognized measures under International Financial Reporting Standards ("IFRS") and do not have a standardized meaning prescribed by IFRS and are, therefore, not necessarily comparable to similar measures presented by other companies. Rather, these measures are provided as additional information to complement those IFRS measures by providing further understanding of our results of operations from management's perspective and to discuss NorthStar's financial outlook. Accordingly, these measures should not be considered in isolation nor as a substitute for analysis of the Company's financial information reported under IFRS. We believe that securities analysts, investors and other interested parties frequently use non-IFRS measures, including industry metrics, in the evaluation of companies in our industry. Management also uses non-IFRS measures and industry metrics in order to facilitate operating performance comparisons from period to period, the preparation of annual operating budgets and forecasts and to determine components of executive compensation.

Total Wagers

Total Wagers are calculated as the total amount of money bet by customers in respect of bets that have settled in the applicable period. Total Wagers does not include free bets or other promotional incentives, nor money bet by customers in respect of bets that are open at period end. Total Wagers is used to provide investors with supplemental measures of our operating performance and thus highlight trends in our business that may not otherwise be apparent when relying solely on IFRS measures.

Gross Gaming Revenue

Gross Gaming Revenue is calculated as dollar amounts bet by customers less the dollar amounts paid out to the customers in respect of such bets which have settled in the applicable period.

Reconciliation of Non-IFRS Measures to IFRS Measures

In Q4 2024, the Company reported $10.0 million of Gross Gaming Revenue ($34.0 million in FY 2024) and has provided a reconciliation to the most comparable IFRS financial measure (Revenue) as follows: $ Millions (unaudited)	Unaudited Three months ended		Year ended
	Dec 31, 2024	Dec 31, 2023	Dec 31, 2024	Dec 31, 2023
Gross gaming revenue from wagered games	$10.0	$ 7.6	$ 34.0	$22.5
Bonuses, promotional costs and free bets	(2.0)	(1.5)	(6.7)	(4.2)
Sub-total Gaming revenue	8.0	6.1	27.3	18.3
Other revenue from managed services	1.5	0.2	2.3	0.5
Revenue	$ 9.5	$ 6.3	$ 29.6	$ 18.8

Operating Results

Marketing expenses are a key driver of the business but are completely discretionary. Management considers "Profit/(Loss) before marketing and other expenses" to be a good indication of the extent to which the business' Gross Margin is in excess of its overhead costs, and therefore offsetting some portion of marketing expenses, reflecting improving economies of scale.

$ Millions (unaudited)	Unaudited Three months ended		Year ended
$ Millions (unaudited)	Dec 31, 2024	Dec 31, 2023	Dec 31, 2024	Dec 31, 2023
Revenue	$ 9,478	$ 6,275	$ 29,556	$ 18,845
Cost of Revenues	5,868	4,167	19,013	13,317
Gross Margin	3,610	2,108	10,543	5,528
General and administrative expenses	3,033	4,452	10,453	12,277
Profit/(Loss) before marketing and other expenses (1)	577	(2,344)	90	(6,749)
Marketing	5,249	5,472	15,456	14,094
Loss before other expenses (1)	(4,672)	(7,816)	(15,366)	(20,843)
Other expenses	(1,070)	149	3,645	6,547
Net loss	$ (3,602)	$ (7,965)	$ (19,011)	$ (27,390)

(1) These measures are not defined by IFRS, do not have standard meanings and may not be comparable with other industries or companies.

Cautionary Note Regarding Forward-Looking Information and Statements

This communication contains "forward-looking information" within the meaning of applicable securities laws in Canada ("forward-looking statements"), including without limitation, statements with respect to the following: expected performance of the Company's business, the Company's growth plans being fully funded, expansion into new markets and future growth opportunities, and expected benefits of transactions. The foregoing are provided for the purpose of presenting information about management's current expectations and plans relating to the future and allowing investors and others to get a better understanding of the Company's anticipated financial position, results of operations, and operating environment. Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "expects", "is expected", "budget", "scheduled", "estimates", "continues", "forecasts", "projects", "predicts", "intends", "anticipates" or "believes", or variations of, or the negatives of, such words and phrases, or state that certain actions, events or results "may", "could", "would", "should", "might" or "will" be taken, occur or be achieved. This information involves known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. This forward-looking information is based on management's opinions, estimates and assumptions that, while considered by NorthStar to be appropriate and reasonable as of the date of this press release, are subject to known and unknown risks, uncertainties, assumptions and other factors that may cause the actual results, levels of activity, performance, or achievements to be materially different from those expressed or implied by such forward-looking information. Such factors include, among others, the following: risks related to the Company's business and financial position; risks associated with general economic conditions; adverse industry risks; future legislative and regulatory developments; the ability of the Company to implement its business strategies; and those factors discussed in greater detail under the "Risk Factors" section of the Company's most recent annual information form, which is available under NorthStar's profile on SEDAR+ at www.sedarplus.ca. Many of these risks are beyond the Company's control.

If any of these risks or uncertainties materialize, or if the opinions, estimates or assumptions underlying the forward-looking information prove incorrect, actual results or future events might vary materially from those anticipated in the forward-looking statements. Although the Company has attempted to identify important risk factors that could cause actual results to differ materially from those contained in the forward-looking statements, there may be other risk factors not presently known to the Company or that the Company presently believes are not material that could also cause actual results or future events to differ materially from those expressed in such forward-looking statements. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. No forward-looking statement is a guarantee of future results. Accordingly, you should not place undue reliance on forward-looking information, which speaks only as of the date made. The forward-looking information contained in this press release represents NorthStar's expectations as of the date specified herein, and are subject to change after such date. However, the Company disclaims any intention or obligation or undertaking to update or revise any forward-looking information whether as a result of new information, future events or otherwise, except as required under applicable securities laws.

All of the forward-looking information contained in this press release is expressly qualified by the foregoing cautionary statements.

For further information:

Company Contact:

Corey Goodman
Chief Development Officer 647-530-2387
investorrelations@northstargaming.ca

Investor Relations:
RB Milestone Group LLC (RBMG)
Northstar@rbmilestone.com

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Investor Insight

Overview

Financial Performance

Company Highlights

Key Brands

NorthStarBets.ca

NorthStarBets.com

Management Team

Michael Moskowitz – CEO and Chairman

Corey Goodman – Chief Development Officer, Counsel and Corporate Secretary

Chin Dhushenthen – Chief Financial Officer

Barry Shafran – Lead Director

Vic Bertrand – Director

Brian Cooper – Director

Sylvia Prentice – Director

Dean MacDonald – Director

Chris McGinnis – Director

Alex Latner – Director, General Counsel, Playtech

Mike Cormack – Head of Content & Integrations

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