Argentina and Mexico drag down Grupo Codere revenue

Codere has reported Q1 results.
Codere has reported Q1 results.

First quarter revenue was down 14 per cent.

Spain.- Grupo Codere has announced its results for the first quarter of 2024. Revenue was €313.8m, a 14 per cent decrease from last year, affected by restrictions in Mexico and a challenging macroeconomic environment in Argentina. Excluding these two business units, revenues were up by 4 per cent year-on-year and above budget.

Codere Online experienced 34 per cent growth with revenue reaching a record €53m driven by upturns of 51 per cent in Mexico and 21 per cent in Spain (+21%). Marketing efforts in both markets saw the base of active customers grow by approximately 25 per cent. However, the turnover of the retail business stood at €260.8m. Argentina revenue was down 59.1 per cent at €34.6m and Mexico was down 11.3 per cent at €54m. Italy, the biggest retail market in Q1, saw revenue fall 2.6 per cent to €78.3m with only Uruguay seeing retail growth (up 4.2 per cent to €17.4m).

The group’s adjusted EBITDA in the period was €47.3m, 27 per cent lower than in Q1 last year but above budget. Excluding Mexico and Argentina, EBITDA increased by 20 per cent, while Codere Online EBITDA rose 103 per cent to €8.8m thanks to good performance in Spain and Mexico.

The group’s cash position remained stable in the quarter. In March, the board of Grupo Codere said it was in “advanced negotiations” with bondholders for a global recapitalisation to improve capital structure for its 2023-to-2027 recovery strategy. Investment bank Houlihan Lokey and law firm Allen & Overy are advising.

The board said the recapitalisation was needed to “clean up the company’s balance sheet and allow Codere to focus on the successful implementation of its business plan, while improving its financial capacity to drive its long-term growth strategy.” It did not reveal how much funding it seeks to raise.

The move comes after Codere raised $100m last year to head off insolvency and stabilise its units in Latin America. It said that it had resolved operational issues in Argentina and Mexico, resulting in statutory losses of $160m in the first half of last year.

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