Financial Data and Key Metrics Changes - The company reported net gaming revenue of €57 million, an 8% increase compared to Q1 2024 [9][12] - Adjusted EBITDA was €1.8 million, marking the fifth consecutive quarter of positive adjusted EBITDA at the consolidated level [12][13] - On a constant currency basis, net gaming revenue would have been €62 million, reflecting a 17% increase year-on-year [10][12] Business Line Data and Key Metrics Changes - The casino segment contributed 61% to total net gaming revenue, driven by a focus on this segment and a lower sports margin in Mexico [10] - In Mexico, net gaming revenue grew 15% to €30.5 million, while in Spain, it remained flat at €22 million [12][15] - The average monthly active users increased by 13%, while the average monthly spend per active customer decreased by 5% to €118 [10][12] Market Data and Key Metrics Changes - The Mexican peso devalued by over 16% in Q1 2025, impacting net gaming revenue by €5 million [15][17] - The number of average monthly active customers in Mexico rose to 82,000, a 31% increase year-on-year [16] - In Spain, the number of active customers increased by 4% year-on-year, reaching 52,000 [14] Company Strategy and Development Direction - The company is focusing on optimizing customer acquisition channels and maintaining its market position in Mexico, which is seen as a core market with significant growth potential [16][62] - The management is adapting promotional strategies in Spain to improve customer quality and retention amid a competitive landscape [14][35] - The company plans to continue investing in Mexico while remaining cautious in other markets like Colombia and Argentina due to regulatory challenges [46][52] Management Comments on Operating Environment and Future Outlook - Management acknowledged the challenges posed by currency fluctuations but expressed confidence in meeting full-year guidance for net gaming revenue between €220 million and €230 million [19][50] - The company expects a difficult comparison for Q2 results but anticipates less impact thereafter as they lap significant devaluation from the previous year [17] - Management is optimistic about the potential for revenue growth in Spain, despite current competitive pressures [64] Other Important Information - The company has initiated a share buyback plan of up to $5 million, with approximately $5 million already spent on repurchasing shares [11][83] - The company is currently under a mandatory monitoring period by NASDAQ but has regained compliance by filing its 2023 annual report [5][6] Q&A Session Summary Question: What is driving the decrease in customer acquisition cost despite increased user acquisition? - Management indicated that testing new traffic sources led to reduced customer acquisition costs, although the revenue impact from these new customers was lower than expected [24][27] Question: What is the impact of competition on revenue growth in Spain? - Management confirmed that the reintroduction of welcome bonuses and increased competition have affected revenue growth, but they are seeing positive trends from adjusted promotional strategies [32][35] Question: Are there plans to increase investments in other markets? - Management noted improvements in Panama and a cautious approach in Colombia, with potential for increased investment in Mexico due to upcoming events [46][52] Question: Will Spain return to revenue growth for the rest of the year? - Management expressed confidence in resuming revenue growth in Spain, supported by positive KPI signals [64][66] Question: What is the rationale behind the share repurchase program? - Management explained that the board approved a $5 million buyback plan within a broader shareholder authorization, allowing flexibility in execution [82][83] Question: Any updates on the Argentina license acquisition? - Management indicated that progress remains stalled due to pricing issues, but they are still open to opportunities [86]
ere Online Luxembourg(CDRO) - 2025 Q1 - Earnings Call Transcript