Catena Media reported in its Q1 report for 2023 that revenue was down from the previous year due to US launches 2022, which presented “challenging comparables”.
The company’s revenue dropped from EUR45.2m to EUR36.2m. This is a 20% drop year-on-year.
Michael Daly, CEO of Catena, says the drop in revenue was to be expected and that it can be attributed to the company’s success in the US in 2022.
Daly stated that “(Revenues) decreased slightly because of the challenging comparatives caused by the record-breaking online sports betting launch in New York Q1 2022, and the go-live date in Louisiana for the same quarter.”
Daly also announced that the highlight of this quarter’s market was the legalisation in Ohio of online sports betting on 1 January 2023.
He said that the dedicated efforts of his North American team, to maximize the advantageous timing right before the Super Bowl in February, led to the launch of one of their best launches ever. However, it was still behind New York on gross revenue terms.
Catena’s adjusted EBITDA (from continuing operations) dropped 7%, from EUR22.1m down to EUR20.5m.
The number of new depositing clients (NDCs), which is the total number of customers who have made a deposit, also decreased by 3%. However, the North American branch of the company saw the largest decrease in NDCs at 4%.
Some revenues did increase during the period. Casino-based activities in North America increased by 8% on an annual basis to EUR10.4m, and sports-based activities in the rest markets of the world by 5% to EUR3.2m.
North America accounts for 83% of Catena’s revenue. The rest of the world makes up 17%. Catena also uses an 81% CPA, 16% revenue share, and 3% fixed agreement model.
Casino & Sport
Catena’s casino-based activities across all markets saw a 5% decline in revenue, but an EBITDA adjusted increase of 18% between EUR6.9m and EUR8.1m.
Catena notes that its partnership with Lee Enterprises, based in the US, has shown “promising early indications” at the end of the third quarter.
The same 5% decline in revenue was also seen in the sport-based activities, but there was also a 19% drop in adjusted EBITDA (from EUR15.2m to EUR12.4m).
It also reported that the company’s direct costs increased to EUR4.1m due to “increased partnerships with media and influencers, mainly from North America”.
Catena’s personnel costs also decreased, due to cutting 25% of its European workforce in November 2022.
The business review that was conducted in 2022, which led to asset sales and “a closer strategic focus on North American regulated markets,” is another significant strategy.
Catena is open to exploring strategic and structural alternatives, including a possible listing of shares in the US.