Catena Media plc Year-End Report January – December 2024

October-December 2024

• Revenue from continuing operations was EUR 10.2m (14.5), a decrease of 30 percent.
• Revenue in North America decreased 28 percent to EUR 8.9m (12.3), equivalent to 87 percent (85) of group revenue from continuing operations.
• New depositing customers (NDCs) from continuing operations totalled 25,806 (32,032), a decrease of 19 percent.
• Adjusted EBITDA from continuing operations increased 2 percent to EUR 1.5m (1.5), corresponding to an adjusted EBITDA margin of 15 percent (10).
• EBITDA from continuing operations increased 62 percent to EUR 0.8m (0.5), equivalent to an EBITDA margin of 7 percent (3).
• Earnings per share from continuing operations totalled EUR -0.02 (-0.47) before dilution and EUR -0.02 (-0.47) after dilution.
• Cash and cash equivalents were EUR 8.5m (38.5) on 31 December.
• Outstanding shares totalled 78,774,442 on 31 December.
• Operating profit was impacted by a non-cash impairment charge of EUR 1.2m related to the AI joint venture. A decision was taken to discontinue the AI-based content generation platform, and an agreement was reached to acquire 100 percent of the business in January, through which EUR 0.7m of the original investment will be recouped.

January-December 2024

• Revenue from continuing operations was EUR 49.6m (76.7), a decrease of 35 percent.
• Revenue in North America decreased 35 percent to EUR 43.9m (67.1), equivalent to 88 percent (87) of group revenue from continuing operations.
• New depositing customers (NDCs) from continuing operations totalled 128,700 (184,257), a decrease of 30 percent.
• Adjusted EBITDA from continuing operations decreased 79 percent to EUR 5.4m (25.4), corresponding to an adjusted EBITDA margin of 11 percent (33).
• EBITDA from continuing operations totalled EUR -0.3m (23.6), equivalent to an EBITDA margin of -1 percent (31).
• Earnings per share from continuing operations totalled EUR -0.63 (-0.37) before dilution and EUR -0.63 (-0.27) after dilution.
• Cash and cash equivalents were EUR 8.5m (38.5) on 31 December.
• Outstanding shares totalled 78,774,442 on 31 December.

Significant events during Q4 2024

• On 22 October, Catena Media announced further measures to streamline the company’s content production and content marketing teams, as part of the transition to a leaner, product-led organisation. The programme will generate an estimated annual cost saving of EUR 2.2m, effective from 1 November 2024.
• On 22 October, Catena Media announced a non-cash impairment charge of EUR 40.0m in line with IAS 36. The charge relates to a writedown in the book value of specific sports and casino assets, following the transition to a product-led operating model.
• On 20 November, Catena media’s board of directors announced the appointment of Stephen Taylor-Matthews as non-executive director and the departure of Øystein Engebretsen.
• On 4 December, Catena Media’s board of directors appointed Martin Zetterlund as non-executive director.
• On 19 December, Catena Media plc announced the initiation of a public tender process for the appointment of independent external auditors for the financial year ending 31 December 2025.
   

Significant events after the period

• No significant events after the period.

CEO Manuel Stan comments

The Q4 results reflected the ongoing challenges we face in our core markets. For the second consecutive quarter, profitability improved following the measures taken since mid-year to streamline the cost structure. These actions reduced the cost base by 33 percent from Q4 2023, lifting our adjusted EBITDA margin from 5 percent in Q2 to 15 percent in Q4. This represents a significant improvement, but reaching higher profitability will also require a return to top-line growth. In Q4, revenue remained under pressure as measures to focus the group on the new strategic priorities set by management gained traction more slowly than anticipated. 

A 6 percent decline in revenue compared to Q3 reflected flat performance in our sports business and the impact of two Google algorithm updates in Q4 that created high volatility levels in our casino-facing organic search operations, with rankings experiencing large day-to-day swings. 

It is clear that our initiatives in search engine optimisation (SEO), product development and geographic expansion will take additional time to translate into revenue gains. While this is unsatisfactory in the short term, I believe we now have the right focus areas and organisational structure in place to create a sustainable business with solid long-term growth prospects.

Addressing our core priorities

Catena Media has in the past spread its resources too thinly across multiple initiatives, diverting attention from core products. Management seeks to correct this by concentrating efforts on the group’s top-performing sites and products. Further brand optimisation plans are in preparation as we focus hard on how best to serve our customers.

To improve execution and accountability in this leaner approach, we in Q4 introduced objectives and key results metrics (OKRs) across the organisation. Though this may seem a basic step, aligning all personnel around key priorities, tracking performance consistently and ensuring focus on the highest-impact areas is critical to our success.

Work also included a range of granular improvements to support our drive for a revenue rebound in 2025. We improved our primary products’ alignment with Google’s web core vitals and stepped up efforts to enhance our brands’ user experiences so we raise the bar in engagement and retention over time. We also enhanced a new customer relationship management (CRM) system in our key products that will allow us to build longer-term relationships with our users and to extend the consumer lifecycle.

Operationally, we strengthened the organisation with key hires, including directors of SEO, Data and Engineering. We also completed the content streamlining announced in October, reducing the group’s headcount by more than 10 percent to align with our product goals. Additionally, we initiated a three-day-per-week return to work for staff at our Malta office and began establishing a US hub in Miami. These measures will be fully implemented in the second half of 2025.

New media partnership and AI change

An exciting development was the signing of an exclusive collaboration with Daily Racing Form (DRF), the premier US source for horse racing insights. In contrast to our previous media partnerships, the relationship with DRF is built on clear mutual value and aligned incentives. The partnership exemplifies the type of strategic relationship we seek – one that drives sustainable profitability for both parties. I look forward to seeing this collaboration reach its full potential.

After careful evaluation, we decided to discontinue our AI-based content generation platform and reached an agreement to acquire 100 percent of the business in January prior to liquidating it. As part of the agreement, we will recoup EUR 0.7m of our original investment. We continue to see AI as an important business enhancer, for example in scaling up content output and quality. However, the new board and management did not deem this venture to be an optimal way to realise the opportunity.

Continued debt reduction and lower interest costs

During the quarter, we repaid the outstanding balance on our revolving credit facility of EUR 10m. Our remaining debt now comprises the senior unsecured bond due in June 2025, which we are now in a position to repay after receiving the proceeds from the AskGamblers sale. This and other incoming payments mean our overall interest costs in the second half of 2025 will be lower than current levels.

Catena Media enters 2025 as a more focused organisation. While Q4 results continued  to disappoint, we significantly improved our profitability through cost optimisation. Our underlying revenue has stabilised in recent quarters, providing a foundation from which we can build. With a leaner organisation, a stronger balance sheet and a clear strategic roadmap, I remain confident in our future direction. I want to thank our team for their tireless work and all our stakeholders for their continued support.

Presentation of Catena Media’s results

CEO Manuel Stan and CFO Michael Gerrow will present the Q4 2024 report in a combined webcast and teleconference on 11 February 2025 at 09:00 CET.

Webcast

Via the webcast you are able to ask written questions. If you wish to participate via webcast, please use the following link:
https://catena-media.events.inderes.com/q4-report-2024

Teleconference

Via teleconference you are able to ask questions verbally. If you wish to participate in the call, please register on the link below. After registration you will be provided phone numbers and a conference ID to access the conference:
https://conference.inderes.com/teleconference/?id=5006377

The presentation will be available on the website:
https://www.catenamedia.com/investors/financial-reports-and-presentations

Contact details for further information:

Investor Relations
Email: [email protected]

Manuel Stan, CEO
Email: [email protected]

Michael Gerrow, CFO
Email: [email protected]

This information is information that Catena Media plc is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact persons, on 11 February 2025 at 07:00 CET.

About Catena Media

Catena Media is a leader in generating high-value leads for operators of online casino and sports betting platforms. The group’s large portfolio of brands guides users to customer websites and enriches the experience of players worldwide. Headquartered in Malta, the group employs over 150 people globally. The share (CTM) is listed on Nasdaq Stockholm Small Cap. For further information see catenamedia.com.