Blue Hat Announces Fiscal Year 2020 Financial Results, Highlighted by 27% Increase in Revenues to $30.2 Million

Blue Hat Interactive Entertainment Technology ("Blue Hat" or the "Company") (NASDAQ: BHAT) a leading producer, developer and operator of augmented reality ("AR") interactive entertainment games, toys and educational materials in China today announced its audited financial results for the fiscal year ended December 31, 2020 .

Fourth Quarter and Fiscal Year 2020 Financial Highlights

Total revenues of US$30.2 million , up 26.7% from US$23.8 million in 2019, driven by increased sales from its information services and Internet Data Center ("IDC") business in late 2020. As such, the majority of revenues was recorded in the fourth quarter of 2020, which increased more than 70% to approximately US$20 million , from US$11.8 million in the prior-year period, primarily driven by the Company's previously mentioned new business lines, which saw significant growth following the strategic acquisition of Xunpusen Technology Co., Ltd. ("Xunpusen") in the second half of 2020.
Gross profit of US$14.0 million , compared to US$16.3 million in 2019
Income from operations of US$9.6 million , compared to US$9.5 million in 2019
Adjusted earnings before interest, taxes, and depreciation and amortization ("Adjusted EBITDA") ^[1] , which excludes amortization of intangible assets and depreciation of property and equipment, of US$10.3 million in 2020
Net income of US$8.3 million , compared to US$9.1 million in 2019
Non-GAAP net income, which excludes bond-related interest, warrant costs, and depreciation and amortization, of US$9.2 million in 2020
US$15.8 million in cash and cash equivalents at December 31, 2020

^[1] We supply non-GAAP information including Adjusted EBITDA and non-GAAP net income because we believe it allows our investors to obtain a clearer understanding of our operations. Any non-GAAP measures should not be considered as a substitute for, and should only be read in conjunction with, measures of financial performance prepared in accordance with GAAP.

Management Commentary

Xiaodong Chen , CEO of Blue Hat, stated, "Over the course of 2020, Blue Hat made several important moves that we believe have significantly strengthened the foundation and overall growth outlook of our business. Late in the year, we completed the acquisition of Xunpusen, launching our new communication services and IDC business, and we have since announced several partnerships with reputable companies like China Mobile and, more recently, Kingsoft Cloud, which will enable us to grow this business and expand our sales channels for our other lines of business. We have bolstered our mobile games business with the acquisition of 51% of Fuzhou Csfctech Co., Ltd. ('Csfctech') and its two subsidiaries, which is a major first step forward in our plans to grow this business through both geographic and product expansion."

Mr. Chen continued, "We are also seeing tremendous opportunity within our interactive education business and announced several agreements with preschools and kindergartens for the implementation of our Augmented Reality Immersive Classes ('ARIC') and STEAM-focused curriculum and technology platform. Today, our ARIC and our proprietary curriculum and platform are being used in over 500 classrooms throughout China , and we continue working with schools and teachers to train and properly implement our technology-driven education programs."

Mr. Chen concluded, "We are pleased to have achieved nearly 27% growth in total revenues, which was primarily driven by contributions from our new information services and communication services businesses late in the year. These growth trends have continued into 2021 so far. Through the last year, we remained profitable despite the challenges presented by the global pandemic and feel we are better positioned to take advantage of the growth opportunities before us in 2021. While the establishment and expansion of our new businesses did impact our bottom line in 2020, we expect that they will support the sales and marketing efforts of our AR, education, and mobile game offerings. We are in the early stages of executing on this growth strategy but have begun to see tangible results from these efforts. We anticipate a gradual improvement in our operating margins over time as we continue to sign new agreements for our AR and mobile game offerings and increase sales of our retail products and interactive education initiatives."

Recent Operating Highlights

In January 2021 , Blue Hat signed a three-year licensing agreement with Cup of Cosmo Studio ( Beijing ) Culture Co., Ltd. for the use of its WUHUANGWANSHUI intellectual property on social media, toys and marketing materials, effective January 1, 2021 . WUHUANGWANSHUI is an original Chinese cartoon image brand of a cat ( Wu Huang ) and a dog (Ba Zahey), which has become an influential brand easily recognized in Chinese pop culture.
In January 2021 , Blue Hat announced the closing of the acquisition of 51% of Csfctech and its two subsidiaries. Csfctech is a developer and distributor of mobile games in China , boasting a portfolio of more than 100 games available on various platforms, with an international user base across Mainland China, Japan , Taiwan , the United Arab Emirates and Africa .
In February 2021 , Blue Hat announced the signing of a three-year agreement with Zhong Ya ( Shenzhen ) International Education Investment Co., Ltd. (" Zhong Ya ") whereby Blue Hat will provide ARIC to Zhong Ya's 680 kindergartens located in Guangdong Province .
In March 2021 , Blue Hat announced the signing of a three-year framework agreement with Kingsoft Cloud Holdings Limited ("Kingsoft Cloud") (NASDAQ: KC), a leading cloud service provider in China , effective August 14, 2020 . Since August, the Company has been providing mainframe hosting, system maintenance, troubleshooting and other services to Kingsoft Cloud's platform in an initial assessment period. This agreement strengthens Blue Hat's growing IDC business following the Company's acquisition of Xunpusen in late 2020.

Fiscal Year 2020 Results

Total revenues were US$30.2 million for fiscal year 2020, an increase of US$6.4 million , or 26.7%, from US$23.8 million in the prior fiscal year. The overall increase was primarily attributable to increased sales of interactive toys (animation series) and contributions from the new information services and communication services businesses.

Revenues from sales of interactive toys (game series) were US$15.9 million for fiscal year 2020, compared to US$21.2 million in the prior fiscal year, primarily due to the COVID-19 pandemic, during which significantly decreased physical shopping activities resulted in fewer sales in the first half of 2020.

Revenues from sales of interactive toys (animation series) were US$2.0 million for fiscal year 2020, an increase of US$1.8 million , from US$0.2 million in the prior fiscal year. This increase was primarily driven by revenue contributions from education courseware sold to kindergartens throughout 2020.

Revenues from mobile games remained steady at US$2.5 million for fiscal year 2020, compared to US$2.5 million in the prior fiscal year. Mobile games are highly cyclical, and the majority of the Company's mobile games reached or passed the peak in their life cycle during the year.

Revenues from information services were US$4.3 million for fiscal year 2020. This is a new business that launched in late 2020, whereby Blue Hat provides products and technical services that enable users with access to the technical service platform to utilize products and services from third-party platforms and medial channels (such as WeChat Official Account, Mini Program, APP, Tik Tok , Toutiao, Quick Worker, etc.).

Revenues from communication services were US$5.5 million for fiscal year 2020. This is a new business that launched in late 2020, following the Company's acquisition of Xunpusen.

Gross profit was US$14.0 million for fiscal year 2020, compared to US$16.3 million in the prior fiscal year. Gross margin for the four different business lines were as follows:

I nteractive toys (game series): 65.5%, or US$10.4 million
Interactive toys (animation series): 31.5%, or US$0.6 million
Mobile games: 99.6%, or US$2.5 million
Information services: (0.1)%, or negative US$0.06 million
Communication services: 8.9%, or US$0.5 million

Gross profit margin was 46.3% for fiscal year 2020, compared to 68.4% for the prior fiscal year, due to the adverse impact the COVID-19 pandemic had on Blue Hat's sales and higher initial costs associated with establishing the new IDC business.

Total operating expenses were US$4.4 million for fiscal year 2020, a decrease of $2.4 million , or 35.2%, from US$6.8 million in the prior fiscal year. This decrease was mainly attributable to a US$0.4 million decrease in selling expenses, a US$1.2 million decrease in general and administrative expenses (due to increased professional expenses related to the Company's IPO in fiscal year 2019), and a US$0.8 million decrease in research and development expenses for fiscal year 2020, when compared to fiscal year 2019.

Income from operations was US$9.6 million for fiscal year 2020, compared to US$9.5 million in the prior fiscal year.

Adjusted EBITDA, which excludes amortization of intangible assets and depreciation of property and equipment, was US$10.3 million for fiscal year 2020. Please refer to the note about non-GAAP measures and the reconciliation table at the end of this press release for additional information.

Net income was US$8.3 million for fiscal year 2020, compared to US$9.1 million in the prior fiscal year. The decrease was primarily due to a $1.3 million increase in income tax expense following the expiration of a preferential tax rate granted by the local government, which was in effect through the end of 2019.

Non-GAAP net income, which excludes bond-related interest, warrant costs, and depreciation and amortization, was US$9.2 million for fiscal year 2020. Please refer to the note about non-GAAP measures and the reconciliation table at the end of this press release for additional information.

Basic and diluted earnings per share were US$0.21 for fiscal year 2020, compared to US$0.26 for the prior fiscal year.

Balance Sheet Highlights

As of December 31, 2020 , Blue Hat had cash and cash equivalents of US$15.8 million , working capital of US$34.0 million , and total shareholders' equity of US$58.8 million , compared to cash and cash equivalents of US$10.5 million , working capital of US$29.0 million , and total shareholders' equity of US$44.8 million , respectively, at December 31, 2019 . Subsequent to year-end, the Company completed a registered direct offering with two institutional investors for the purchase and sale of 7,160,000 of its ordinary shares at a price of $1.06 per share, resulting in total gross proceeds of approximately $7.59 million before deducting the placement agent's fees and other estimated offering expenses.

Conference Call

Blue Hat management will host an earnings conference call on Thursday, April 8, 2021 , at 8:30 a.m. ET ( 8:30 p.m. Beijing /Hong Kong Time).

Dial-in details are as follows:

Participant Dial-in Numbers
U.S. & Canada (Toll-Free):	+1 (877) 407-9046
International (Toll):	+1 (201) 689-8733

	Local Access
Mainland China:	(400) 120 2840
Hong Kong:	(800) 965561

Additionally, a live and archived webcast will be available at https://ir.bluehatgroup.com .

About Blue Hat

Blue Hat Interactive Entertainment Technology is a producer, developer and operator of AR interactive entertainment games and toys in China , including interactive educational materials, mobile games, and toys with mobile game features. The Company's interactive entertainment platform creates unique user experiences by connecting physical items to mobile devices, which creates a rich visual and interactive environment for users through the integration of real objects and virtual scenery. Distinguished by its own proprietary technology, Blue Hat aims to create an engaging, interactive and immersive community for its users. For more information, please visit the Company's investor relations website at https://ir.bluehatgroup.com . The Company routinely provides important information on its website.

Forward-Looking Statements

This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. All forward-looking statements are inherently uncertain as they are based on current expectations and assumptions concerning future events or future performance of the Company. Readers are cautioned not to place undue reliance on these forward-looking statements, which are only predictions and speak only as of the date hereof. In evaluating such statements, prospective investors should review carefully various risks and uncertainties identified in this release and matters set in the Company's SEC filings. These risks and uncertainties could cause the Company's actual results to differ materially from those indicated in the forward-looking statements.

Contacts :

Blue Hat Interactive Entertainment Technology
Phone: +86 (592) 228-0010
Email: ir@bluehatgroup.net

Investor Relations:

The Equity Group Inc.                                    In China
Adam Prior , Senior Vice President                Lucy Ma, Associate
(212) 836-9606                                              +86 10 5661 7012
aprior@equityny.com lma@equityny.com

BLUE HAT INTERACTIVE ENTERTAINMENT TECHNOLOGY AND SUBSIDIARIES
AUDITED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

	For the Years Ended December 31,
	2020		2019
Revenues	$	30,191,069	$	23,834,129
Cost of revenue		(16,206,823)		(7,531,800)
Gross profit		13,984,246		16,302,329

Operating expenses:
Selling		(522,168)		(928,680)
Research and development		(281,618)		(1,031,204)
General and administrative		(3,613,361)		(4,860,189)
Total operating expenses		(4,417,147)		(6,820,073)
Income from operations		9,567,099		9,482,256

Other income (expense)
Interest income		147,840		629
Interest expense		(439,607)		(171,938)
Other finance expenses		(82,338)		(4,415)
Other income, net		864,198		221,146
Total other income, net		490,093		45,422
Income before income taxes		10,057,192		9,527,678
Provision for income taxes		1,776,175		453,724
Net income		8,281,017		9,073,954

Other comprehensive income (loss)
Foreign currency translation adjustment		(3,220,363)		(521,738)
Comprehensive income	$	5,060,654	$	8,552,216
Less: Comprehensive income attributable to non-controlling
interests		(111,404)		-
Comprehensive income attributable to Blue Hat Interactive
Entertainment shareholders		4,949,250		8,552,216

Weighted average number of ordinary shares
Basic		38,553,694		35,141,114
Diluted		39,859,074		35,141,114

Earnings per share
Basic		$0.21		$0.26
Diluted		$0.21		$0.26

BLUE HAT INTERACTIVE ENTERTAINMENT TECHNOLOGY AND SUBSIDIARIES
AUDITED CONSOLIDATED BALANCE SHEETS

	December 31,		December 31,
ASSETS	2020		2019
Current assets:
Cash and cash equivalents	$	15,800,563	$	10,478,587
Inventories		117,075		125,264
Accounts receivable, net		16,594,533		13,631,359
Accounts receivables - related party		1,906,101		-
Other receivables, net		14,350,223		13,182,529
Prepayments, net		1,917,780		299,577
Restricted cash		-		5,000,000
Total current assets		50,686,275		42,717,316

Non-current assets:
Operating lease, right-of-use asset		290,410		679,850
Prepayments		4,164,274		4,425,849
Property, plant and equipment, net		4,258,121		2,324,823
Intangible assets, net		14,252,575		6,758,316
Long-term investments		1,914,668		1,727,301
Deferred tax assets		119,127		182,234
Total non-current assets		24,999,175		16,098,373
Total assets	$	75,685,450	$	58,815,689

LIABILITIES AND EQUITY
Current liabilities:
Short-term loans - banks	$	5,129,295	$	5,819,787
Current maturities of long-term loans - third party		14,117		77,493
Taxes payable		6,802,454		3,525,153
Accounts payable		935,588		293,985
Other payables and accrued liabilities		1,846,917		3,628,809
Other payables - related party		25,837		21,341
Operating lease liabilities - current		300,468		313,460
Customer deposits		941,877		-
Convertible bonds payable		739,189		-
Total current liabilities		16,735,742		13,680,028

Non-current liabilities:
Operating lease liability		-		372,051
Long-term loans - third party		-		13,328
Total other liabilities		-		385,379
Total liabilities		16,735,742		14,065,407

Shareholders' equity
Ordinary shares, $0.001 par value, 100,000,000 shares authorized, 38,553,694 shares issued and outstanding as of December 31, 2020, and 35,141,114 shares issued and outstanding as of December 31, 2019		38,554		35,141
Additional paid-in capital		23,466,482		20,771,849
Statutory reserves		2,204,174		1,289,765
Retained earnings		31,387,398		24,132,194
Accumulated other comprehensive income (loss)		1,741,696		(1,478,667)
Total Blue Hat Interactive Entertainment Technology shareholders' equity		58,838,304		44,750,282
Non-controlling interests		111,404		-
Total equity		58,949,708		44,750,282
Total liabilities and shareholders' equity	$	75,685,450	$	58,815,689

BLUE HAT INTERACTIVE ENTERTAINMENT TECHNOLOGY AND SUBSIDIARIES
RECONCILIATIONS OF NON-GAAP MEASURES TO THE MOST COMPARABLE GAAP MEASURES

		For the Year Ended December 31, 2020

Income from operations		$9,567,099
Add: Depreciation and amortization		$738,544
Adjusted EBITDA		$10,305,643

Net income		$8,281,017
Add: Bond-related interest and warrant costs		$191,534
Add: Depreciation and amortization		$738,544
Non-GAAP net income		$9,211,095

Earnings per weighted average ordinary share outstanding Basic and diluted		$0.21
Add: Non-GAAP adjustments to net income per share		$0.02
Non-GAAP basic and diluted earnings per share		$0.23

About Non-GAAP Financial Measures

This press release contains the non-GAAP financial measures including Adjusted EBITDA and non-GAAP net income, of which the most directly comparable financial measure presented in accordance with U.S. generally accepted accounting principles ("GAAP") is income from operations and net income, respectively. These measures are not in accordance with, or alternatives to GAAP, and may be different from other non-GAAP financial measures used by other companies. The Company uses non-GAAP financial measures as a supplemental performance measure of our operations, for financial and operational decision-making, and as a supplemental means of evaluating period-to-period comparisons on a consistent basis.

The Company believes the presentation of these non-GAAP financial measures provide investors with relevant and useful information, as it allows investors to evaluate the operating performance of the business activities without having to account for differences recognized because of non-core or non-recurring financial information. When GAAP financial measures are viewed in conjunction with non-GAAP financial measures, investors are provided with a more meaningful understanding of the Company's ongoing operating performance. In addition, non-GAAP financial measures are among those indicators the Company uses as a basis for evaluating operational performance, allocating resources, and planning and forecasting future periods. Non-GAAP financial measures are not intended to be considered in isolation, or as a substitute for, GAAP financial measures. To the extent this release contains historical or future non-GAAP financial measures, the Company has provided corresponding GAAP financial measures for comparative purposes. The reconciliation between certain GAAP and non-GAAP measures is provided above.

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SOURCE Blue Hat Interactive Entertainment Technology

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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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