Codere Online ((CDRO)) has held its Q2 earnings call. Read on for the main highlights of the call.
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The recent earnings call for Codere Online painted a balanced picture, reflecting both positive strides and notable challenges. The company demonstrated resilience by maintaining compliance with NASDAQ requirements, increasing its active customer base, and managing costs effectively. However, it also faced hurdles such as currency devaluation impacts and heightened competition in key markets.
Regained NASDAQ Compliance
Codere Online confirmed its compliance with all applicable NASDAQ listing requirements, following the filing of their 2023 and 2024 annual reports. This achievement eliminates any uncertainty regarding their status as a publicly traded company, providing reassurance to investors and stakeholders.
Increased Net Gaming Revenue (NGR) in Constant Currency
While the reported net gaming revenue remained flat at EUR 55 million, in constant currency terms, it would have shown a significant increase to nearly EUR 61 million, marking a 12% rise over the previous year. This highlights the underlying growth potential, despite currency fluctuations.
Growth in Active Customers and First-Time Depositors
The company saw a 7% increase in average monthly active customers and acquired 78,000 first-time depositors, also a 7% increase from the previous year. This growth in customer base is a positive indicator of Codere Online’s market penetration and appeal.
Positive Adjusted EBITDA
Codere Online reported a positive adjusted EBITDA of EUR 2.3 million, with the Spanish market contributing notably to this figure, showing a 5% increase over the prior year. This reflects effective cost management and operational efficiency.
Successful Cost Management
The company’s overall cost control efforts resulted in a EUR 1 million increase in adjusted EBITDA compared to Q2 2024. This demonstrates Codere Online’s commitment to maintaining financial discipline amid challenging market conditions.
Improved Cash Flow Position
Despite facing a negative foreign exchange impact, Codere Online generated over EUR 5 million in cash flow for the first half of 2025. This improvement in cash flow position underscores the company’s financial resilience.
Impact of Mexican Peso Devaluation
The devaluation of the Mexican peso by 19% had a significant negative impact, resulting in a EUR 5.7 million reduction in net gaming revenue. This highlights the vulnerability of the company’s financial performance to currency fluctuations.
Challenges in Colombia
The introduction of a value-added tax on player deposits in Colombia led to a EUR 1.6 million drop in net gaming revenue. This regulatory change poses a challenge to maintaining revenue levels in the region.
Competitive Pressures in Spain
In Spain, a more competitive landscape, marked by the reintroduction of welcome bonuses, resulted in flat net gaming revenue and a 3% decline in active customers. This indicates the need for strategic adjustments to maintain market share.
Lower Average Monthly Spend Per Active Customer
The average monthly spend per active customer decreased by 5%, primarily due to the weaker Mexican peso. This decline suggests a need for strategies to enhance customer spending.
Forward-Looking Guidance
Codere Online provided forward-looking guidance, anticipating net gaming revenue between EUR 220 million and EUR 230 million for the full year, with adjusted EBITDA expected to range from EUR 10 million to EUR 15 million. The company also highlighted the acquisition of 78,000 first-time depositors and a share repurchase initiative, indicating confidence in its growth prospects.
In summary, Codere Online’s earnings call reflected a balanced sentiment, with significant achievements in NASDAQ compliance and customer growth, countered by challenges from currency devaluation and competitive pressures. The company’s forward-looking guidance suggests optimism for continued growth, despite the hurdles faced.