Casino growth offsets sports decline for Catena in Q1
Catena Media has reported a 2.3% year-on-year increase in revenue for the first quarter in its preliminary results for the period, despite the sports betting arm of its business being impacted by the ongoing novel coronavirus (Covid-19) global pandemic.
Revenue for the three months to 31 March totalled €26.7m (£23.3m/$29.0m), up from €26.1m in the corresponding period last year.
Catena said its casino segment was responsible for 61% of revenue during Q1, with sports representing 33% of overall revenue and financial services 6%.
The affiliate giant said that the casino segment performed well during the period, with traffic and new depositing customers both higher than in Q4 of 2019.
In terms of sports, despite this segment suffering, Catena said it continued to work with key operators to promote sports events that are still running, while increased focus was put on converting traffic from a number of sports-related sites into casino revenues.
In terms of financial services, Catena said that this area of the business continues to show positive momentum, but as with casino and sports did not provide figures at this time.
Adjusted earnings before interest, tax, depreciation and amortisation (EBITDA), excluding exceptional costs rose 15.2% from €11.2m to €12.9m. EBITDA was also up by 11.6% from €11.2m to €12.5m.
Though Catena did not go into further detail about its performance in Q1, it did note that it did not make any major investments during the quarter, with the contingent earn-out liabilities amounting to €7.1m as of 31 March.
In addition, Catena revealed that it had cash and cash equivalents of €19.3m and a net interest-bearing debt position of €143.2m at the end of the quarter.
The figures are unaudited and based on management accounts, with Catena due to publish its full first quarter interim report on 20 May.
“Our business remains strong and I am happy to see that revenues in the first quarter increased compared to last year and that April has continued to develop well, despite weaker performance from the sports segment,” Catena’s chief executive Per Hellberg said.
“Our measures to improve cost-efficiency – especially during these difficult times – allowed us to increase profitability by 15% compared to last year. Further, it makes me proud to see that our employees continue to achieve great things while working remotely.”
Last month, Catena reported a 5.7% year-on-year increase in revenue for the two months to 29 February, saying it anticipated further growth amid the pandemic through increased uptake of casino products.
However, the affiliate giant also noted that gaming authorities have suggested or enforced temporary restrictions on operators during the outbreak. Sweden will impose a SEK5,000 weekly deposit limit from 1 June, while Veikkaus will reduce its monthly and weekly loss limits to €500 from 1 May. Spain has also imposed additional restrictions on gambling advertising during the pandemic, and Portugal's parliament aims to limit igaming in some form to protect players under lockdown.
While these limitations may have a short-term impact on average player values, Catena said this will be mitigated by an increase in player numbers.
Earlier this month, Catena opted to put its membership of affiliate trade association Responsible Affiliates in Gambling (RAiG) on hold, though it said it remains open to joining in the future.
The business had agreed to join RAiG – which was founded in May 2019 – in December 2019, but Catena spokesperson Åsa Hillsten told iGB that it opted not to go through the vetting process for members for the time being.