After a disappointing end to 2023, Catena Media has reported on another underwhelming quarter for the group in its Q1 2024 results. 

Q1 2024 

Revenue from continuing operations was €16m ($17.2m), representing a significant decrease of 49% year-on-year. Looking specifically at North American revenue, this went down by 50% to €14.3m and was equivalent to 90% of the group revenue from continuing operations during the quarter. 

The largest fall in revenue looking at individual segments was sports revenue in North America, down 70% to €5.5m. Sports revenue for the rest of the world decreased only 1% to €607,000, though casino revenue for the rest of the world was down 46% to just under €1.1m. Casino revenue in North America dropped 15% to €8.8m. 

Adjusted EBITDA from continuing operations also saw a large drop-off, as it declined 90% to €1.9m, which led to an adjusted EBITDA margin of 12%. Adjusted EBITDA margin in Q1 2023 was 59%. 

What may have impacted the group was new depositing customers (NDCs) from continuing operations taking a large dip, of 41% specifically, to a total of 44,077. 

At the time of writing (12:22pm BST), Catena’s share price was 6.90 SEK, a 20.5% decrease from the closing price on Tuesday last week. 

Strategic Direction 

Going forward, Catena is looking to invest to develop a new range of technical and data-based capabilities, particularly in AI, while it believes cost optimisation measures will ensure continued high profitability. 

The group believes organic growth will resume in the second half of this year and that its financial position will allow for focused debt reduction and strategic investments. It is looking to have a phased transition from a CPA-dominated revenue model to a higher mix of revenue share. 

Also, the company will aim to have a significantly lower presence in unregulated grey markets and those with unclear regulatory frameworks. 

Comments 

Catena Interim CEO Pierre Cadena gave some thoughts on the results, saying: “Catena Media is implementing a programme of organisational and leadership changes to confront continued poor performance through Q1 2024. This transition is essential as we continue to target organic revenue growth in the second half of this year.  

“Operational outcomes during the period were again unsatisfactory, especially in North American sports. Stronger competition, tightened marketing spending by operators, and challenging comparables with Q1 2023 – when online sports betting went live in Ohio and Massachusetts – combined to push revenue and EBITDA lower 

“Significant internal and strategic changes are being implemented on multiple levels to achieve the turnaround, and these accelerated in Q1. The initiatives have multiple focal points: technology leadership; strategic product development; enhanced operational efficiency; and a new multichannel structure to diversify our product offerings. 

“Underpinning all the ongoing initiatives is the introduction of a new technical platform, whose rollout began during the quarter and will be integrated across our global product portfolio in Q2. This will be the first time the group directs all of its monetisation activities through a single, coherent tech architecture.” 

Manuel Stan was announced as the new CEO of Catena back in March, but he will take up the position on 1 July.