Catena’s “disappointing” FY2023 results: Can it bounce back?

Catena Media updated its long-term financial characteristics from 2024 to 2026. Catena CEO Michael Daly was not soft on his assessment of the division's performance in 2023.

Compared to a confident start to 2023, the year was "disappointing," Daly said.

Looking back, it can be said that Catena started the year on a high note. The North American business started the year back on a strong note, with profits up 24% year-on-year.

In fact, the company's US expansion was going strong. By 2023, the company had launched operations in several US states, including New York, Louisiana, Ontario, Kansas and Maryland.

The huge intentions, combined with the group's new strategic focus on North America as its frontline, made 2023 look promising.

"Taking full advantage of the high-yield opportunities offered by this market will be our key operating focus going forward," Daly said in early 2023.

The company was awash in red, white and blue paint. Expectations were pretty high for the South American Dream™.

Catena for delivery in the US in 2023

Betting big on the US

Unfortunately, this was a while ago, and now, that is, right now. Currently, the company is heavily reliant on the US, which accounts for more than 80% of all profits.

However, when the annual results were released, North American profits were down 21% to 67. 1 million euros (57. 1 million pounds / 71. 9 million dollars). Overall, the company's promotions were down more than 75% year-on-year.

Break down these characteristics by quarter, the fourth-quarter results show that relief in North America is declining rapidly: it was down 43. 0% to 12. 3 million euros.

In the third quarter, it was down 29%, and in the second quarter it was down 16%.

So, despite its enormous commitment to 27 intensive North American jurisdictions, and despite the fact that more than 80% of the company's profits come from across the Atlantic, Catena is now putting its eggs in one basket. And this basket is already throwing in taxes.

It is clear that something must be produced to stop the ever-accelerating decline. A reduction in promotional expenses of 75% year-on-year is an absolute and urgent call for panic.

But before looking at the conclusions, let's look at the main characteristics of the company, first for the fourth quarter and then for the entire financial year.

Q4 2023: Accelerating decline

As a result of the poor performance in the United States, profit from continuing operations was down 41% to 14. 5 million euros.

The main factor is that the number of fresh layers (NDC) in the device decreased by 43 % from 56. 040 in the previous quarter, to 32. 032.

After adjustment, eBitDa indicators decreased by 88%. This is mainly due to the decrease in the number of raw layers by 43%.

After adjusting the set, the eBitDa indicator is still 88 % down to 15 million euros, which is basically equivalent to EBITDA margins after adjusting 10 %.

Unfortunately, for traders who do not mention promotion, the profits of the promotion from the ongoing business were separated from € 0 and 47.

FY2023: Grim reading

As a matter of course, at the time of this memo, the market value of the Sweden stock exchange fell by more than 10 %.

This tells you that the bazaar has not been ecstatic since this year, even modestly. Moreover, this is especially true, taking into account that this decline is 75 % in a on e-year calculation.

As a whole, looking at the characteristics of the annual cash, you can gain an absolute idea of ​​how large this depression is.

As a whole, profits agree with 767 million euros, decreasing 22 % yea r-o n-year, decreasing 21, 0 %.

As part of a continuous business, the number of fresh buyers, which accounted for the top score, was 184. 257, actually decreased by 19 %.

After adjusting the work, the EBITDA indicators decreased by 47 % to 25. 4 million euros, comparable to 33 % 0 % of the eBitDa indicators after adjustment.

The profits related to the promotion of the ongoing business reached € 0 and 47 in the fourth quarter, only € 0, 37, and it was found that it was more than the fourth quarter, and the calm curves were reflected. I'm doing it.

Disappointing or disastrous?

We go to the Daily Secretar y-General and begin to be displayed as Undermining, his choice of language. It may be the only text we need, taking into account the decrease of "catastrophic" promotional cost by 75 %.

STS founder Mateuschu Yuroshka probably spoke more concisely than us. "Catena media instructions should be reduced right now, and assets should be executed in the market." This is a situation that damages the company. "

Perhaps this is the latest reaction. In particular, taking into account the fact that the top of the company is actually managing businesses that have been replaced daily, due to a series of asset resale transactions.

But how do you explain this depression? President Daily pointed out in a comment on the headline that the fourth quarter performance indicated the "headwind of the market", but did not give a detailed explanation. As a result, the number of sales in the mainstay North American market decreased, and EBITDA declined.

"The decrease in the cost of the operator (CPA) paid (CPA) has again influenced the revenue, as if the competition of the company leader in the existing market intensified," he said.

The company has announced that it is preparing to start sports betting in North Carolina in 2024. In January, the company reported a record earning of sports betting in Ohio.

Technology, innovation and immersive experiences

A optimist, the latest investment rounds of the planned catenas as a result of the strategic review, which began in 2022, emphasized that the core technology of the group would change the focus.

As a result, it is possible to provide new products that prioritize technology, innovation, and immersive user experiences.

He has been sold in August 2023 to Moneta Communications, including the transfer of online sports brands in the UK and Australia for 6 million euros, and is about 4 million for the "optimization of group businesses". He emphasizes the cost reduction program for the euro and hopes to stabilize business.

However, the sale of brands is likely to improve basic profit margins than sales. However, it is expected that rebalancing will increase lon g-term stability and sustainability.

Dali also emphasizes that the initial revenue will decrease by abolishing CPA and prioritizing revenge share as a shor t-term negative aspect. However, this situation does not progress so rapidly.

At a telephone conference in the morning with a catera analyst, Dali emphasized that if the company became active in North Carolina, it would be expected to increase "potential." But the risk is that it seems to return to the company's manifest in early 2023.

Bouncing back

Dali says the important message is "patience." "The large strategic reset that we have done may take time, and the patience of employees and shareholders may be tested."

"The fourth quarter was a difficult time, but I believe it has come to the corner now. More slim, faster, Omn i-channel's catera media succeeded in major regulatory markets, growing in the second half of this year. Equipped with knowledge and technical infrastructure to return.

The main initiatives include investing in The Fake Mind (AI), commercial media, su b-filing, and recruitment of new strategic media partners. As a result, it is expected that the viewer's coverage will increase, providing a lot of interest in partners. In short, this is a reasonable position as a enthusiast with data and technology.

A Better Collective ?

A hidden ball that can not be underestimated is owned by a better group of 6 and 23 % of the promotion of caternal media. The bundle was acquired in early 2023.

Eric Edin, a shor t-term economic director of the catera, explains in the profit and loss report of this year's unwilling results by intensifying competition in the United States.

So what kind of competition is it? First, from a better group. Interestingly, they still have their own promotion. Even if there is a loss of acquiring the catera at the peak of the price, they are in the best state.

The difference from the catera is that they have raised the expected value of the absolute year's rescue three times in 12 months. Better collector has raised its own monitoring twice in 2023.

In July 2023, the company acquired a South American manufacturer of Sports, Content Playmaker HQ for $ 54 million.

To keep these two transactions in early February, Better Collector also blocked a position on the acquisition of Toront o-based Digital Sports Company Playmaker Capital. The group has acquired the company in November 2023 and posted it for € 176 million.

What does this mean for the catera? In a nutshell, it's an encouragement to shareholders. In fact, the catera will actually require a rival blessing, taking up their six, 23 % of their promotions, taking into account the desire to solve this point.

In addition, they are actually required to solve them and are required in advance to prevent their major opponents on all. Taking this into account, the species, especially if you are currently taking into account, are made much darker, for example, the problem of increasing profits.

Refloating the Titanic

Let's talk to the threat business. Along with the caternal statement, we will see his task at the beginning-a more stable advantage model.

In short, the end of a strategic review suggests that it will be a knight in armor full of gaps. The review ended last November.

The group has been waiting for an organic rise in the second half of 2024. Apart from this, the company aims to achieve EBITDA indicators after adjusting the eel year in the range of 20 to 30 million euros.

New goals include increasing the rescue and adjustment at the group level in 2025 and 2026 by two digits. In addition, the migration to a more stable revenue model means adopting the maximum number of players through a profitable contract with the operator.

As I wrote above, this is an alternative to previous contracts by payment (CPA), but it has not been so late to see if it works.

The second thing to tell is how the company realizes larg e-scale investment programs on technology and data innovation.

According to the company's intention, developing a new platform in the first quarter and second quarter of 2024, that is, a huge bet on fak e-mind.

Rolling out the AI buzzword

Catas believe that by turning their resources to AI, they can change their fate.

"The rapid formation of technology and the rise of the origin of artificial hearts (AI) are trying to replace the media-industry," said Daily.

"Regarding the casino parts of online sports and gambling games, the configuration will be larger. Catena media will freeze this new situation as the main force."

In real time, the catera is planned to sell a huge internal investment program that covers a large-scale investment in technology and fake-mind, and the minimum tenacious product (MVP) is already in the development process.

So what is it actually and what do you do? According to the company's intentions, Daily discussed that the task was "accelerating our appealing implementation to freeze in the field of affiliate marketing based on data and technology."

The catera is planning to settle a huge bet in AI in 2024.

These plans are disappointing and have a huge meaning in the context of our fourth quarter characteristics. The planned investment, planned before 2023, was subsequently accelerated. These investments are to cook us for the future and return the group to the sustainable flow of lon g-term growth.

It is actually thought that fresh platforms will promote the introduction of new tools to improve "organic search abilities". This is "We can apply data and technological innovation to product development."

Fresh platforms are made for scalability and can "fast" innovation in any kind of field that covers AI and sub attachments. At the fastest, we already resemble content in a way we already have a later media, Chatgpt. This allows you to scale your personal content, not very likely to be very likely to write content.

According to our information, the launch of the new platform is expected to be the first quarter of 2024. After being fully introduced in the second quarter, catena media will focus on a single technology infrastructure for the first time.

Can it work?

Catas are not the first company to expect fake intelligence, but they definitely have a great intention to make a big change.

"Fake Intelligence is a positive power that enables our team to utilize that knowledge, eventually create higher quality and beautiful products, and gives a greater profit," says Dali.

If you have a fresh technical platform, you will be able to quickly integrate the joint venture AI and other major language models into business. "

"The same goes for commercial media, is a significant new industry, which increases our reach and influence in the market, especially in sports betting."

But in this case, patience has the most important meaning. Only after such an investment has begun to work, the market will have the opportunity for the company to plan to change the current policy. Finally, important questions: What does automation actually bring?

Multischannel's catera media, which fits more and more agile, has a chance to return to his victory. However, keeping the same news in early 2023 needs to see more before they admit that this decline is irreparable.

Almost a year later, it was found that the main concern was a regulated market. Of course, artificial intelligence is also added.

I still don't know how this rise will happen. Alternatively, using the latest industry buzzwords is "whether this conclusion really works." < SPAN> According to our information, the launch of the new platform is expected to be in the first quarter of 2024. After being fully introduced in the second quarter, catena media will focus on a single technology infrastructure for the first time.