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GCL Announces First Half Fiscal Year 2025 Unaudited Financial Results

1. GCL reported a 41% revenue increase, reaching $50.9 million. 2. Gross margin fell to 13.8%, down from 16.2% last year. 3. Net loss of $0.8 million improved from $1.9 million loss in FY2024. 4. GCL completed business combination with RFAC Acquisition Corp. on February 13. 5. Acquired 20% of NEKCOM Inc., enhancing game publishing capabilities.

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Why Bullish?

Strong revenue growth and reduced net loss indicate financial improvement, possibly boosting investor confidence.

How important is it?

Earnings report and strategic acquisitions signal potential for growth, thus impacting market perception significantly.

Why Short Term?

Immediate impacts expected from revenue results and business combination but financial challenges remain.

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RFACNEKCOM
SINGAPORE, Feb. 14, 2025 (GLOBE NEWSWIRE) -- GCL Global Holdings Ltd. (Nasdaq: GCL) (“GCL” or the “Company”), a leading provider of games and entertainment, today announced its financial results for the six months ended September 30, 2024. First Six Months of FY2025 Highlights Revenues of $50.9 million, up 41% from the prior year periodGross Margin of 13.8% compared to 16.2%Net loss of $0.8 million, compared to net loss of $1.9 millionAdjusted EBITDA of $1.5 million, compared to $1.4 million in the first half of FY2024. “We are pleased with our very robust top-line growth and improved bottom line performance in the first half of fiscal year 2025, highlighting our team’s execution capabilities while closing the business combination with RFAC Acquisition Corp.,” said Sebastian Toke, Group CEO of GCL. “These results reflect the strength of our marketing and distribution and the increasing quality of game developers we are able to partner with. As a public company going into Fiscal 2026, we expect to bring a larger slate of “hit” new titles to gamers across Asia and position GCL as the premier partner for the next generation of innovative game designers.” Revenues for the first half of fiscal year 2025 were $50.9 million, up 41.0% from $36.1 million in the comparable six months in 2024. The increase was primarily driven by console games and game code sales. The cost of revenues was $43.9 million for the first six months of FY2025, up 45.4% compared to $30.2 million for the same period of the last year, primarily due to the increase of revenue from console games as more units (both physical versions and console game codes) were sold. Selling and marketing expenses were $1.2 million for the first six months of FY2025 compared to $1.3 million for the same period of the last year, as the company focused on operation efficiency in distribution. General and administrative expenses were $6.9 million for the first six months of FY2025, an increase of 4.5% compared to $6.6 million for the same period of the last year. Total operating expenses increased 2.5% to $8.1 million for the first six months of FY2025, from $7.9 million for the same period of the last year. Net loss was $0.8 million for the first six months of FY2025, compared to a net loss of $1.9 million for the first six months of FY2024. Adjusted EBITDA for the first six months of FY2025 was $1.5 million, up from $1.4 million in the comparable prior year period. Loss per share, basic and diluted, was $0.02 for the first six months of FY2025, compared to a loss per share, basic and diluted of $0.06 for the same period of the last year. As of September 30, 2024, the Company had $10.3 million in cash and restricted cash in total, compared to $4.3 million as of March 31, 2024. Recent Developments Completed business combination with RFAC Acquisition Corp. on February 13, 2025, and the ordinary shares and warrants of GCL are expected to commence trading on Nasdaq on February 14, 2025.GCL acquired 20% of NEKCOM Inc. and obtained global publishing rights for its upcoming game “Showa American Story.” About GCL Global Holdings GCL Global Holdings Ltd. unites people through immersive games and entertainment experiences, enabling creators to deliver engaging content and fun gameplay experiences to gaming communities worldwide with a strategic focus on the rapidly expanding Asian gaming market. Drawing on a deep understanding of gaming trends and market dynamics, GCL Group leverages its diverse portfolio of digital and physical content to bridge cultures and audiences by introducing Asian-developed IP to a global audience across consoles, PCs, and streaming platforms. Learn more at http://www.gclglobalholdings.com. Forward-Looking Statements This press release includes “forward-looking statements” made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995, and may be identified by the use of words such as “estimate,” “plan,” “project,” “forecast,” “intend,” “will,” “expect,” “anticipate,” “believe,” “seek,” “target” or other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. These forward-looking statements may also include, but are not limited to, statements regarding projections, estimates and forecasts of revenue and other financial and performance metrics, projections of market opportunity and expectations, the estimated implied enterprise value of the Company, GCL’s ability to scale and grow its business, the advantages and expected growth of the Company, and the Company’s ability to source and retain talent. These statements are based on various assumptions, whether or not identified in this press release, and on the current expectations of GCL’s management and are not predictions of actual performance. These statements involve risks, uncertainties and other factors that may cause actual results, levels of activity, performance, or achievements to be materially different from those expressed or implied by these forward-looking statements. Although GCL believes that it has a reasonable basis for each forward-looking statement contained in this press release, GCL cautions you that these statements are based on a combination of facts and factors currently known and projections of the future, which are inherently uncertain. In addition, there are risks and uncertainties described in the proxy statement/prospectus included in the Registration Statement relating to the recent business combination, filed by the Company with the SEC on December 31, 2024 and other documents which will be filed by the Company from time to time with the SEC. These filings may identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. GCL cannot assure you that the forward-looking statements in this press release will prove to be accurate. There may be additional risks that GCL presently knows or that GCL currently believes are immaterial that could also cause actual results to differ from those contained in the forward-looking statements. In light of the significant uncertainties in these forward-looking statements, nothing in this press release should be regarded as a representation by any person that the forward-looking statements set forth herein will be achieved or that any of the contemplated results of such forward-looking statements will be achieved. The forward-looking statements in this press release represent the views of GCL as of the date of this press release. Subsequent events and developments may cause those views to change. However, while GCL may update these forward-looking statements in the future, there is no current intention to do so, except to the extent required by applicable law. You should, therefore, not rely on these forward-looking statements as representing the views of GCL as of any date subsequent to the date of this press release. Except as may be required by law, GCL does not undertake any duty to update these forward-looking statements. Non-GAAP Measures Some of the financial information and data contained in this press release, such as adjusted EBITDA have not been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). GCL believes these non-GAAP measures of financial results provide useful information to management and investors regarding certain financial and business trends relating to GCL’s financial condition and results of operations. GCL’s management uses these non-GAAP measures for trends analyses and for budgeting and planning purposes. GCL believes that use of these non-GAAP measures provides an additional tool for investors to use in evaluating projected operating results and trends in and in comparing GCL’s financial measures with other similar companies, many of which present similar non-GAAP financial measures to investors. Management of GCL does not consider these non-GAAP measures in isolation or as an alternative to financial measures determined in accordance with GAAP. The principal limitation of these non-GAAP financial measures is that they exclude significant expenses and income that are required by GAAP to be recorded in GCL’s financial statements. In addition, they are subject to inherent limitations as they reflect the exercise of judgments by management about which expenses and income are excluded or included in determining these non-GAAP financial measures. You should review GCL’s audited financial statements, which are presented in the recent proxy statement/prospectus filed with the SEC on December 31, 2024, and not rely on any single financial measure to evaluate GCL’s business. GCL Investor Relations: Crocker Coulsoncrocker.coulson@aummedia.org(646) 652-7185 Unaudited Condensed Consolidated Balance Sheets (Stated in U.S dollars, except for the number of shares)   September 30  March 31   2024  2024   (Unaudited)     ASSETS        CURRENT ASSETS        Cash and cash equivalents $7,727,167  $2,677,059 Restricted cash  2,577,553   1,656,678 Accounts receivable, net  13,248,026   17,413,086 Amount due from related parties  60,592   21,880 Inventories, net  6,563,779   4,826,217 Other receivable and other current assets, net  1,041,953   460,997 Prepayments, net  9,295,186   5,510,988 Total current assets  40,514,256   32,566,905          NONCURRENT ASSETS        Property and equipment, net  450,916   505,111 Definite-lived intangible assets, net  2,735,858   3,273,226 Indefinite-lived intangible assets  11,904,882   6,858,114 Goodwill  2,990,394   2,990,394 Long-term investment  71,045   71,045 Other receivable, non-current  -   167,000 Operating leases right-of-use assets  906,596   1,128,066 Finance leases right-of-use assets  426,916   470,100 Deferred merger costs  1,836,164   1,065,854 Deferred tax assets, net  588,414   462,429 Total noncurrent assets  21,911,185   16,991,339          TOTAL ASSETS $62,425,441  $49,558,244          LIABILITIES, MEZZANINE EQUITY, AND SHAREHOLDERS' EQUITY        CURRENT LIABILITIES        Bank Loans, current $14,270,394  $8,812,807 Accounts payable  10,117,098   7,016,238 Accounts payable, a related party  6,329,474   6,567,480 Contract liabilities  1,779,725   209,903 Other payables and accrued liabilities  3,953,032   3,101,586 Advance proceeds from converible notes  4,012,500   - Operating lease liabilities, current  588,180   792,197 Contingent consideration for acquisition, current  3,426,385   2,319,000 Finance leases liabilities, current  80,631   72,868 Amount due to related parties  386,008   486,016 Tax payables  968,254   1,017,143 Total current liabilities  45,911,681   30,395,238          NON-CURRENT LIABILITIES        Operating lease liabilities, non-current  348,283   370,103 Finance leases liabilities, non-current  205,269   234,765 Bank Loans, non-current  67,908   208,010 Deferred tax liabilities  82,075   346,969 Contingent consideration for acquisition, non-current  -   1,378,000 Total non-current liabilities  703,535   2,537,847          TOTAL LIABILITIES  46,615,216   32,933,085          COMMITMENTS AND CONTINGENCIES                 MEZZANINE EQUITY        Ordinary shares subject to possible redemption, 53,711 shares as of September 30, 2024 and March 31,2024  700,000   700,000          SHAREHOLDERS' EQUITY        Ordinary share, par value $0.0001; 150,000,000 shares authorized, 25,916,468 shares issued and outstanding as of September 30, 2024 and March 31, 2024, respectively  2,592   2,592 Additional paid-in capital  1,738,012   1,738,012 Retained earnings  11,426,087   11,938,374 Accumulated other comprehensive loss  (131,020)  (120,551)TOTAL GCL Global Limited shareholders' equity  13,035,671   13,558,427          Non-controlling interests  2,074,554   2,366,732          TOTAL SHAREHOLDERS' EQUITY  15,110,225   15,925,159          TOTAL LIABILITIES, MEZZANINE EQUITY  AND SHAREHOLDERS' EQUITY $62,425,441  $49,558,244   Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss (Stated in U.S dollars, except for the number of shares)   For the Six Months Ended September 30,   2024  2023 REVENUES        Revenues $50,905,030  $36,047,105 Revenues, a related party  675   41,464 TOTAL REVENUES  50,905,705   36,088,569          COST OF REVENUES        Cost of revenues  (36,579,493)  (25,401,903)Cost of revenues, related parties  (7,308,820)  (4,835,828)TOTAL COST OF REVENUES  (43,888,313)  (30,237,731)         GROSS PROFIT  7,017,392   5,850,838          OPERATING EXPENSES        Selling and marketing  (1,219,251)  (1,266,421)General and administrative  (6,878,939)  (6,590,726)Total operating expenses  (8,098,190)  (7,857,147)         LOSS FROM OPERATIONS  (1,080,798)  (2,006,309)         OTHER INCOME (EXPENSE)        Other income, net  356,921   1,095,157 Interest expense, net  (359,624)  (254,172)Change in fair value of contingent consideration for acquisition  270,615   (681,000)TOTAL OTHER INCOME, NET  267,912   159,985          LOSS BEFORE INCOME TAXES  (812,886)  (1,846,324)         BENEFIT (PROVISION) FOR INCOME TAXES  10,444   (16,168)         NET LOSS  (802,442)  (1,862,492)         Less: net loss attributable to non-controlling interests  (290,155)  (332,096)         NET LOSS ATTRIBUTABLE TO GCL GLOBAL LIMITED'S SHAREHOLDERS  (512,287)  (1,530,396)         NET LOSS  (802,442)  (1,862,492)         OTHER COMPREHENSIVE LOSS        Foreign currency translation adjustments  (12,492)  (58,132)         COMPREHENSIVE LOSS  (814,934)  (1,920,624)         Less: total comprehensive loss attributable to noncontrolling interests  (292,178)  (329,055)         Total comprehensive loss attributable to GCL Global Limited's shareholders $(522,756) $(1,591,569)         LOSS PER SHARE - BASIC AND DILUTED, ORDINARY SHARES $(0.02) $(0.06)         WEIGHTED AVERAGE NUMBER OF ORDINARY SHARES OUTSTANDING        Basic and diluted  25,916,468   25,896,000   Unaudited Condensed Consolidated Statements of Cash Flows (Stated in U.S. dollars, except for the number of shares)   For the Six Months Ended   September 30   2024  2023 CASH FLOWS FROM OPERATING ACTIVITIES:        Net loss $(802,442) $(1,862,492)Adjustments to reconcile net loss to net cash used in operating activities:        Depreciation of property and equipment  165,415   165,878 Amortization of intangible assets  537,367   573,693 Amortization of right of use assets- operating leases  421,485   305,616 Amortization of right of use assets- finance leases  56,246   18,638 (Recovery from) Provision for credit loss and doubtful accounts  (203,270)  28,306 Loss from disposal of property and equipment  -   56,793 Deferred taxes benefit  (359,472)  (341,257)Change in fair value of contingent consideration for acquisition  (270,615)  681,000 Change in operating assets and liabilities        Accounts receivables  5,902,561   3,304,346 Accounts receivables, a related party  -   (2,423)Inventories  (1,552,924)  (925,554)Indefinite-lived intangible assets  (5,030,276)  1,710,119 Other receivable and other current assets  (381,235)  245,078 Prepayments  (3,593,582)  (750,499)Prepayments, a related party  -   (722,881)Accounts payable  3,047,728   (473,187)Accounts payable, a related party  (311,011)  2,067,082 Contract liabilities  1,555,495   2,199,886 Other payables and accrued liabilities  (946,978)  122,688 Other payables and accrued liabilities , a related party  -   (23,916)Operating Lease Liabilities  (426,338)  (306,512)Income tax payables  2,666   67,717 Net cash (used in) provided by operating activities  (2,189,180)  6,138,119          CASH FLOWS FROM INVESTING ACTIVITIES:        Purchases of equipment  (76,681)  (64,723)Cash received in business combinations, net of cash acquired  -   85,443 Net cash (used in) provided by investing activities  (76,681)  20,720          CASH FLOWS FROM FINANCING ACTIVITIES:        Proceeds from bank loans  13,798,964   7,896,390 Repayments to bank loans  (8,485,654)  (12,982,420)Advances proceeds related convertible notes  4,012,500   - Repayments from related parties  -   3,640,931 Loan to related parties  -   (2,251,258)Repayments to related parties  (72,399)  - Principal payments of finance lease liabilities  (32,324)  (12,289)Payments of deferred merger costs  (693,070)  (338,018)Net cash provided by (used in) financing activities  8,528,017   (4,046,664)         EFFECT OF EXCHANGE RATE ON CASH AND CASH EQUIVALENTS, AND RESTRICTED CASH  (291,173)  (102,441)         INCREASE IN CASH AND CASH EQUIVALENTS, AND RESTRICTED CASH  5,970,983   2,009,734          CASH AND CASH EQUIVALENTS, AND RESTRICTED CASH, beginning of period  4,333,737   3,831,606          CASH AND CASH EQUIVALENTS, AND RESTRICTED CASH, end of period $10,304,720  $5,841,340          SUPPLEMENTAL CASH FLOWS INFORMATION        Income taxes paid $349,028  $357,425 Interest paid $359,624  $254,172          SUPPLEMENTAL NON-CASH FLOWS INFORMATION        Fair value of share issuance in acquisition of a subsidiary $-  $687,348 Right-of-use assets in exchange for operating lease liabilities $177,704  $- Recognition of non-controlling interest from acquisition of subsidiaries $-  $182,599   Reconciliation of Non-GAAP to GAAP Measures (unaudited)(Stated in US dollars)  Six Months Ended September 30,  For the Years Ended March 31, 2025 2024 2024 2023 2022          Adjusted EBITDA reconciliation         NET INCOME ATTRIBUTABLE TO GCL GLOBAL LIMITED'S SHAREHOLDERS(512,287) (1,530,396) (1,373,504) 1,986,119 4,562,952Provision for taxation(10,444) 16,168  53,291  620,142 758,136Net income attributable to non-controlling interests(290,155) (332,096) (587,452) 154,551 23,573Director fee446,631  1,107,677  1,329,679  284,984 332,457Professional fee relating to listing812,805  525,223  939,683  650,139 394,194One time marketing support-  -  300,000  - -Depreciation expense257,178  165,961  320,308  303,378 295,553Amortisation of customer brand537,367  554,166  1,229,421  887,523 -Change in fair value of contingent consideration(270,615) 681,000  272,029  932,152 -Finance cost359,624  254,173  507,803  299,702 191,163Stock written off141,047  629  -  - -Adjusted EBITDA1,471,151  1,442,505  2,991,258  6,118,690 6,558,028          

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