Codere Online witnessed a substantial decline in net losses during the initial three months of 2023, while earnings experienced a notable rise.
The gaming enterprise Codere Online observed a considerable reduction in net losses following a 54.9% surge in net gaming revenue during the first quarter of 2023.
Codere Online experienced a marked decrease in net losses in the first quarter of 2023, accompanied by a substantial increase in revenue.
Codere Online observed year-over-year growth across all its operational markets in the three-month period concluding on March 31, with revenue in each regional business expanding by double-digit percentages.
Chief Executive Officer Avi Shem lauded the influence of the previous quarter’s investment centered around the FIFA World Cup, which enabled the company to broaden its customer base, with a significant portion remaining active in the initial quarter.
“We commenced 2023 with a robust performance, registering a 55% increase in net gaming revenue during the first quarter, reaching nearly €40 million,” Shem remarked. “Our substantial investment surrounding the World Cup last quarter empowered us to significantly expand our customer base, surpassing pre-World Cup levels.
“These customers have maintained their engagement throughout the first quarter, particularly in Spain and Mexico. Moreover, our cross-selling endeavors between sports betting and casino have played a pivotal role in customer engagement, with the latter contributing 53% of our net gaming revenue.”
Initial Quarter
Revenue for the initial quarter amounted to €39.5 million (£34.4 million/$43.1 million), representing an increase from €25.5 million in the corresponding period of the preceding year.
Coderes Spanish operations are their top earner, generating 18.4 million euros in the first quarter, a 39.4% surge from the previous year. However, the number of individuals utilizing their service each month only saw a slight increase, from 38,287 to 40,193.
Mexico experienced the most significant growth, with revenue soaring by 76% to 17.6 million euros. This was due to a greater number of people using their service, rising from 33,382 to 49,556.
In other locations, Colombia witnessed a 53.3% increase in revenue to 2.3 million euros, while other regions generated 1.2 million euros, a 50% rise.
On the expenditure side, marketing was the largest expense, costing 19.8 million euros, but this was a 10.4% decrease from the previous year. However, spending on the platform and content rose by 24.4% to 10.7 million euros, while employee costs increased by 40.7% to 3.8 million euros and taxes on gaming climbed by 64.1% to 640,000 euros.
After accounting for other expenses of 1.1 million euros, adjusted EBITDA resulted in a loss of 2.3 million euros, but this was an improvement compared to the 13.2 million euro loss in the same period last year.
Codere did not disclose all the financial details for the quarter, but they stated that their net losses were significantly lower, decreasing from 10.1 million euros to 1.1 million euros, and they had over 49 million euros in cash at the end of the first quarter.
“We are pleased to report robust revenue growth in the quarter, and even more importantly, a substantial improvement in adjusted EBITDA,” remarked Oscar Iglesias, Codere Onlines CFO.
This is partially due to reduced marketing expenditures this quarter, as we proceed with our strategy to deliver lasting growth for our investors.
For the entire year, we anticipate net gaming revenue to be between €140 million and €150 million, with adjusted EBITDA between €-20 million and €30 million. However, considering our robust performance in the initial quarter, we now expect to be at the upper end of that range and are on course to attain positive EBITDA and cash flow for the entirety of 2024.
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