Super Group (SGHC) Ltd

This Annual Report also includes Adjusted EBITDA, which is a non-GAAP company-specific performance measure that we use to supplement our results presented in accordance with IFRS. Adjusted EBITDA is EBITDA adjusted for RSU expense, payroll taxes on RSUs granted in connection with the Business Combination, change in fair value of options, unrealized foreign exchange, gain on disposal of business, impairment of assets, U.S. sportsbook closure, market closure, gain on bargain purchase, transaction fees, gain on derivative contracts, share listing expense, foreign exchange on revaluation of warrants and earnouts, change in fair value of warrant and earnout liabilities and other adjustments. We believe that Adjusted EBITDA is useful in evaluating our operating performance as it is similar to measures reported by our public competitors and is regularly used by securities analysts, institutional investors and other interested parties in analyzing operating performance and prospects. Adjusted EBITDA is not intended to be a substitute for any IFRS financial measure and, as calculated, may not be comparable to other similarly titled measures of performance of other companies in other industries or within the same industry.

Because of these limitations, Adjusted EBITDA should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP. We compensate for these limitations by relying primarily on our IFRS results and using Adjusted EBITDA on a supplemental basis. You should review the reconciliation of net profit to Adjusted EBITDA below and not rely on any single financial measure to evaluate our business.

The table below presents a reconciliation of profit / (loss) to EBITDA and Adjusted EBITDA:

1 Associated payroll expenses relating to the one off RSUs issued related to awards following the Transaction described in note 24 to our consolidated financial statements included elsewhere in this Annual Report of nil (2023: nil, 2022: €1.1 million) are included in this line.

2 The gain on disposal of business relates to the sale of the B2B division of DGC. See note 19 to our consolidated financial statements included elsewhere in this Annual Report for further details.

3 The U.S. Sportsbook closure relates to onerous contracts and other costs relating to the closure of the DGC sportsbook during the year. See note 11.1 to our consolidated financial statements included elsewhere in this Annual Report for further details.

4 Market closure costs relates to the Group's exit from the Indian market on October 1, 2023. In 2023, this includes contract termination costs, bad debt and contract write offs. In 2024, this includes additional bad debt in connection with the closure.

5 Other non-recurring adjustments in 2024 include mainly Sportsbook acquisition related costs and certain legal costs. In 2023, this included bad debt and SOX implementation fees relating to new acquisitions. In 2022, this included audit and other fees relating to the listing.