Catena Media Q3 update
The top line
- Revenue estimated at €33.1m, up 33% YoY with North American operations up 124% and now worth 51% of total group revenues. Adjusted EBITDA estimated at €16m, up 33%.
- German revenue fell 82% over the period and now down to 4% of group revenue. A total writedown of €49.4m will be taken on the previously acquired German and French assets.
Mein Walkman ist kaputt 2: Back in Nov17, Catena Media bought the BayBets business for €63.5m. The deal involved an upfront payment of €26.5m and a two-year earnout from the remainder. At the time, BayBets was generating quarterly revenues of ~€2.25m with an operating margin of 70%. It isn’t achieving that now, needless to say. The French assets refer to the ParisSportifs operation bought in April 2018 for €6.2m in cash and a further €2m in shares.
Drums and wires: CEO Michael Daly said the writedown
“adjusts our European business to new market realities” and reflects an “updated assessment by management of the assets’ expected future earnings in the context of recent regulatory changes in Germany’s iGaming market and overall market conditions.”
Recall, between 2014-18 Catena went on a huge buying spree of European and US assets and more write downs of the European buys may follow: “Management regularly assesses expected future earnings in accordance with IAS 36 and may further adjust assets’ amortisation plans,” said Catena.
Mr Brightside: Catena can at least be thankful for its foresight with regards to the PlayNJ assets bought in Dec16, with the US now driving the whole show.
CEO Michael Daly said Q3 was “an exceptional quarter” with revenues in September breaking the company’s own one-month record. “This was the result of our strategic investment in organic development, particularly in North America, and was supported by two recent acquisitions in the United States and the opening of the iGaming market in Arizona,” he added.
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