Codere Online Reports Strong Q1 Revenue Growth and Reduced Losses

Codere Online witnessed a substantial decrease in net losses during the initial three months of the year, while net gaming income increased by a notable 54.9%.

Every operational market for Codere Online experienced year-over-year expansion in the period ending March 31, with double-digit growth in operating income across all regions.

Chief Executive Officer Avi Shem commended the influence of investments made surrounding the World Cup in the preceding quarter, which enabled the company to broaden its customer base, a significant portion of whom remained active in the first quarter.

“We commenced 2023 with a strong performance, with net gaming income rising by 55% in the first quarter to nearly €40 million,” stated Shem. “Our substantial investments surrounding the World Cup in the previous quarter allowed us to significantly expand our customer base from pre-World Cup levels.

“These customers have maintained their activity throughout the first quarter, particularly in Spain and Mexico. Furthermore, our cross-selling endeavors between sports betting and casino have played a substantial role in customer engagement, with the latter contributing 53% of our net gaming income.”

Income reached €39.5 million (£34.4 million/$43.1 million) in the initial three months of the year, a notable increase from €25.5 million in the corresponding period of the previous year.

Coderes Spanish operations remain its primary income source, generating €18.4 million in the initial three months, a 39.4% rise compared to the same period last year. However, the average count of monthly active users only saw a slight uptick, rising from 38,287 last year to 40,193.

Mexico witnessed the most substantial growth for the operator, with revenue soaring by 76.0% to €17.6 million. This surge was fueled by an increase in the average number of monthly active users, jumping from 33,382 to 49,556.

In other territories, Colombia experienced a 53.3% year-on-year revenue increase, reaching €2.3 million, while other regions saw activity revenue of €1.2 million, representing a 50.0% growth.

Regarding expenses, marketing costs were the most significant, totaling €19.8 million, although this figure was down 10.4% from €22.1 million the previous year. Nevertheless, platform and content expenses rose by 24.4% to €10.7 million, personnel expenses climbed by 40.7% to €3.8 million, and gaming taxes increased by 64.1% to €6.4 million.

Additionally, there were €1.1 million in other expenses, resulting in an adjusted EBITDA loss of €2.3 million, although this marked an improvement from the €13.2 million loss in the corresponding period last year.

Codere refrained from disclosing comprehensive details of its remaining financial performance for the quarter but did highlight that net losses were considerably reduced from €10.1 million to €1.1 million, while its cash position at the end of the initial three months surpassed €49 million.

“We are pleased to report strong revenue growth this quarter, and more importantly, a significant improvement in adjusted EBITDA,” remarked Oscar Iglesias, Codere Online’s Chief Financial Officer.

This outcome is partially attributed to reduced promotional expenditures during the current fiscal period, as we progress with our strategy to provide enduring growth for our investors.

For the entire fiscal year, we anticipate generating net gaming revenue ranging from €140 million to €150 million, with an adjusted EBITDA of €20 million to €30 million. However, considering our robust performance in the initial quarter, we now anticipate being at the upper end of this range and are on course to attain positive EBITDA and cash flow for the entirety of 2024.

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