Catena Media has initiated a series of cost optimisation measures following a challenging first quarter of 2025, as the igaming affiliate group aims to stabilise operations and accelerate its path toward renewed revenue growth.
Revenue from continuing operations for the period January to March was €9.8 million, down 39% from €16.0 million in Q1 2024. The North American market, which accounted for 89% of group revenue, saw a similar 39% decline to €8.8 million.
New depositing customers (NDCs) from continuing operations totalled 21,918, representing a 50% year-on-year decrease. Adjusted EBITDA from continuing operations fell 51% to €0.9 million, with a corresponding adjusted EBITDA margin of 9%. Reported EBITDA stood at €0.6 million, consistent with a 6% margin year-on-year.
Earnings per share from continuing operations were €-0.01 both before and after dilution, compared to €-0.03 in the same period last year. As of 31 March, Catena Media reported €24.6 million in cash and cash equivalents and a total of 78,774,442 outstanding shares.
There were no significant events during the quarter. However, post-period developments included the resignation of non-executive director Dan Castillo on 3 April. The board now comprises five non-executive directors ahead of the company’s annual general meeting, scheduled for 21 May 2025.
On 13 May, Catena Media announced a strategic reduction in operating expenses, including the removal of a management layer and a workforce reduction of over 50 roles, equating to a 25% reduction in headcount. These actions are expected to generate annualised cost savings of €4.5 to €5.0 million. The company also confirmed that interest payments on its hybrid capital security would be deferred until further notice.
CEO Manuel Stan commented: “Q1 was a disappointing quarter that showed we still have substantial work ahead to fully stabilise the business and rebuild profitability. The 3 percent decrease in revenue from Q4 2024 was the smallest quarterly drop in recent periods, signalling that the steep declines of past quarters may now be behind us. However, this small positive was overshadowed by significantly lower adjusted EBITDA, which fell by around 60 percent from Q4, bringing the margin below 10 percent.
“This margin decline, which comes after two consecutive quarters of improvement, reflected a shift in the revenue mix towards more subaffiliation, which comes with lower gross margins, and a small increase in personnel expenses.
“We responded after the close of the quarter by implementing major changes to our teams and processes to improve the cost structure and operational efficiency. These included the removal of a layer of senior management and the elimination of more than 50 roles, including a mix of contractors and full-time employees. The outcome was to reduce group headcount by around 25 percent. Together, the actions taken will result in annualised cost reductions of close to EUR 4.5-5.0m.
“In parallel, we initiated a shift to a unified Microsoft-based tech stack and terminated several legacy software subscriptions, generating further savings estimated at around EUR 0.8m annually. I am confident that our costs will decrease in both absolute and relative terms in the coming quarters.
“Organisational changes spanned all levels, including senior management. In addition to reducing the cost base, the purpose was to establish a flatter internal structure with fewer layers to promote agility. The steps taken were tough, but essential to embed a sustainable cost trajectory and ensure every part of the business is set up to support growth and fast delivery.
“The immediate priority now is to improve long-term profitability by increasing revenue while maintaining a lower cost base. We will achieve this by operating more efficiently and eliminating internal silos. We will build a tech-enabled centre of excellence to identify and execute automation opportunities across the organisation to deliver real, scalable impact – an effort that will require investment.
“Together, these measures will equip our teams with better tools, faster processes and cleaner data to support smarter decisions and more agile execution. It is a foundational pillar of our long-term strategy to grow revenue without replicating old cost structures.
“On the revenue side, the picture was mixed in Q1. Our core search business experienced continued volatility in rankings, especially in North America, where search-engine algorithm updates pose an ongoing challenge. Encouragingly, we saw progress in two key diversification areas: subaffiliation and lifecycle marketing. Both these streams reached all-time highs during the quarter, reflecting the success of our long-term efforts to reduce reliance on organic search alone.
“While we are excited to see growth in these areas, the replacement of revenue from our owned brands with subaffiliation comes at a lower margin. That said, demand from both partners and operators continues to grow, providing our internal teams with strong motivation heading into Q2.
“We continue to concentrate our efforts on North America, where we see the most potential. Performance outside this region was weak in Q1 and will not be a focus going forward. We have no plans to revisit this stance in the near term.
“In Casino, we are monitoring regulatory activity in our social sweepstakes sub-segment as some US states make legislative moves. We continue to build our brands and database in preparation for regulation, while in the meantime complying rigorously with the regulations in each state.
“In summary, Q1 was a weak quarter that we have addressed through tough measures. With those changes now underway, and with tech-led scalability at the heart of our roadmap, we are laying the groundwork for more consistent performance in the rest of 2025.
“Our objective now is to drive profitable revenue growth through focused execution, operational efficiency and scalable growth platforms built for customer engagement. I would like to thank our teams for their hard work and dedication, and our shareholders for their ongoing support as we continue our journey to build a stronger Catena Media.”
