In the second quarter of 2024, the company experienced a transitional phase marked by significant shifts in its operating model and management team, leading to both challenges and early signs of recovery.
For the period of April to June 2024, revenue from continuing operations stood at €12.8 million (£11 million/US$14.1 million), reflecting a 14 percent decline compared to the same period last year. The North American market, which constitutes 88 percent of the group’s revenue, saw an 11 percent decrease, bringing in €11.2 million. The number of new depositing customers (NDCs) from continuing operations fell by 17 percent, totaling 31,475.
Adjusted EBITDA from continuing operations decreased significantly, down 67 percent to €0.7 million, representing an adjusted EBITDA margin of 5 percent. Including items affecting comparability, EBITDA from continuing operations totaled €-0.6 million, with an EBITDA margin of -4 percent. Earnings per share from continuing operations were €-0.04 before dilution and €-0.04 after dilution. As of 30 June, cash and cash equivalents were reported at €18.9 million, with outstanding shares totaling 78,773,422 and outstanding warrants at 27,022,940.
For the first half of 2024, revenue from continuing operations reached €28.8 million, a 38 percent decrease from the previous year. North America accounted for €25.5 million of this revenue, maintaining its share at 89 percent of the group’s total. NDCs for the six-month period totaled 75,552, a 33 percent decline. Adjusted EBITDA from continuing operations dropped 88 percent to €2.5 million, corresponding to a margin of 9 percent. Including items affecting comparability, EBITDA from continuing operations was €0.3 million, with a margin of 1 percent. Earnings per share from continuing operations were €-0.07 before dilution and €-0.06 after dilution.
Several key events shaped the second quarter of 2024. Edward Midolo was appointed as CTO, effective 1 April, and Michael Gerrow assumed the role of CFO on 15 April. On 20 June, the company issued a Q2 earnings update following a review of preliminary financial results for May, which identified reduced effectiveness in some strategic media partnerships due to changes in organic search policies.
Following the quarter’s close, new leadership was further solidified with Manuel Stan assuming the role of CEO on 1 July, and Pierre Cadena being appointed as COO. These leadership changes are expected to play a crucial role in driving the company’s strategy and operational performance moving forward.
CEO Manuel Stan comments: “I am delighted to have joined Catena Media as new CEO as of 1 July. In my first weeks I have seen first-hand the strength and potential of our products and the talents and ambition of our people. I look forward to working with the new board of directors and the entire Catena team to drive the company forward.
“My thanks to the previous management and CEO and to the former board and chairman for handing over a restructured business with lower debt, and to Pierre Cadena for standing in as interim CEO during Q2 and driving a number of key initiatives that we are now working together to implement.
“Today, my top priority is embedding our new operating model and optimising our products as we return to growth. I see high energy levels as we start this new chapter. Since 1 April, four out of five members of the executive management team are new in their roles. By year-end the makeover will be complete with the appointment of a new general counsel.
“A significant step in Q2 was to replace the former geographical organisational structure with a product-based operating model. We also acted to rightsize cost and now have the right people in the right places. Led by COO Pierre Cadena and CFO Michael Gerrow, these fundamental changes and our all-new management team will allow us to be more focused on the key priorities, more aligned across the organisation and better equipped to develop key business relationships with our customers. I look forward to seeing the fruit of these efforts in the coming quarters.
“Our Q2 results were in line with the earnings update issued in June. They reflected the changes in search engine policies that impacted some media partnerships for affiliates, including Catena Media. While the changes had an immediate negative effect, we saw a positive impact over our owned and operated products later in the quarter. During the quarter, we also renegotiated some media partnerships and withdrew from others where results were suboptimal. Media partnerships remain of interest provided they offer the right financial and commercial terms.
“In Q2, our most important search terms ranked steadily higher. Such progress takes time to be reflected in revenue, but it gives me confidence that our core organic search capability is on the right path. To that end, and for enhanced transparency, we have added a new search performance metric on page 3 of this report.
“Revenue growth continued in North American casino, both year-over-year and from Q1. This relates in part to the sharpened product focus and the targeted investments made into our flagship brands during 2024. It also reflects strong growth in our sweepstakes casino business.
“The launch of a Spanish-language version of Bonus.com during the quarter was our first initiative to target the Hispanic market in North America. This demographic offers significant long-term potential, given that around 15 percent of Americans speak Spanish as their first language.
“In sports, we intend to replicate the targeted brand-focused investments that have lifted the casino business in recent months. Q2 is seasonally slow, and in line with our previously communicated forecast we expect a stronger second half to the year, particularly after the start of the American football season in September.
“Other highlights in the quarter included the soft launch of our subaffiliation platform, Mrktplays. This is a first step towards our goal to build a market-leading marketplace for the industry – one that brings value and expertise by offering a platform that provides a dynamic ecosystem where affiliates and operators can connect and drive growth.
“Catena Media has a strong portfolio of outstanding products and a highly motivated team of experts in their fields. In my opinion, the group has previously tried to do too many things and spread its resources too thinly, resulting in under-optimisation of core products. The new board and management agree on the need for a laser-sharp operating focus. We are now in a stronger position to concentrate on the core products and drive revenue. To that end, we have completed an extensive prioritisation exercise and, as a first step, we are clearing many low-performing domains to allow our teams to focus on the top products.
“I am excited by the challenges ahead and optimistic of the future as we maximise our products’ potential, particularly in the casino segment where we see strong opportunities for growth. I believe Catena Media is well positioned to become a leading partner for the iGaming industry in North America.”
