Affiliates

XLMedia expects $11.5m in 2020 EBITDA as Google demotion recovery begins

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Affiliate business XLMedia expects to deliver revenue of approximately $54.4m (£39.8m/€44.8m) for the full year 2020, down 31.7% year-on-year, with adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) down 65.7% at $11.5m.

The business said it was pursuing a multi-track approach to recovering its revenue in the casino sector, where several of its websites were penalised by Google early in 2020.

It is also undertaking a “fundamental rationalisation“ of its asset portfolio, significantly reducing the overall number of websites it runs and improving the quality of those that remain.

It added that its focus will be on highly engaging content and enhanced functionality to drive increased traffic and build customer loyalty going forward.

As part of its attempt to recover revenues in the casino vertical, XLMedia is submitting certain sites which have been rebuilt to Google for reconsideration, developing entirely new sites, de-indexing sites which may have a negative impact on the authority of its premium sites, and disposing of sites that no longer fit with the direction of the business.

To date, it said it has been successful in having the penalty removed for three of the ten sites it wishes to recover; Casino.pt, Casino.gr and CasinoKiwi.co.nz.

The information it has learned from these successes and from initial rejections is being applied to the ongoing refinement of the remaining websites, which it said will be resubmitted in due course.

A further update on the casino recovery process, along with the financial results for the year ended 31 December 2020, is expected to be published in April.

Results published in September showed that revenue for the six months to 30 June amounted to $27.7m, down 34.7% from $42.5m in the corresponding period in 2019.

Google’s demotion of XLMedia websites, alongside difficulties caused by the novel coronavirus (Covid-19) pandemic, were cited as the primary reasons for the decline.

The business said at the time that the impact of these factors on its revenue had been approximately negative $2m per month since late March.

The business has continued to undertake strategic acquisitions throughout 2020, completing a buyout of global football media publisher 101GreatGoals.com in July, and US-focused sports gaming and sports betting business, CBWG Sports, in December.

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