In the first quarter of 2024, Codere reported a significant decline in revenue, falling from €363.1 million in Q1 2023 to a lower figure, which also saw a decrease in adjusted EBITDA by 26.6%, dropping from €64.4 million to €47.3 million.
The company’s consolidated net revenues also saw a reduction, amounting to €185.9 million, a 12.1% decrease compared to €211.5 million in the same quarter the previous year.
Despite these decreases, Codere’s financial stability remains intact, with a cash position only slightly adjusted from €107.5 million at the start of the period to €104 million.
The company attributes this stability to the continued recovery from the lifting of restrictions in Mexico and Argentina, suggesting an optimistic outlook for future growth.
The company also announced it is engaging in discussions for a “comprehensive recapitalisation” with bondholders, aiming to decrease debt and reinforce the balance sheet. Codere expressed optimism about updating stakeholders on this development soon.
Challenges persist in Mexico and Argentina, with Codere noting the complex economic environment in Argentina.
However, the situation is improving, with restrictions being lifted, potentially boosting financial outcomes as the year progresses.
Despite closures and partial restrictions affecting 14 of its halls in Mexico, Codere has made notable strides in easing operational constraints.
Excluding hyper-inflation adjustments in Argentina, Codere’s Q1 retail revenue outside Argentina was €226.2 million, a 7% increase from Q3 2023.
Without including Argentina and Mexico, Q1 revenue increased by 4%, and adjusted EBITDA rose by 20%.
Codere Online continues to perform exceptionally well, setting a new quarterly revenue record at €53 million, marking a 34.2% increase year-over-year.
This growth was led by a 51.1% increase in Mexico, alongside a 21.2% rise in Spain. Online revenue now constitutes 16.9% of the total group revenue for Q1, with retail revenue declining by 19.4% to €260.8 million compared to the previous year.
Marketing enhancements in Mexico and Spain have effectively expanded the customer base by about 25.2%, from 89.8 million to 112.5 million.
Codere Online’s adjusted EBITDA for the quarter was €8.8 million, significantly higher than the €4.3 million in the same period last year, with net income also improving from a net loss of €1.3 million in Q1 2023 to a net gain of €3.4 million.
Looking ahead, Codere Online has raised its net gaming revenue forecast for 2024 to between €195 million and €210 million, from the earlier projection of €185 million to €200 million, expecting to remain EBITDA and cash flow positive throughout the year.
In contrast, the retail sector has not fared as well, particularly affected by economic issues in Argentina, leading to a 59.1% drop in retail revenue there.
Mexico and Italy also saw declines, with only Uruguay recording growth in this segment. Adjusted EBITDA in retail was down 35.8% to €38.5 million.