Catena Media changes operating model after Q1 “underperformance"

By Dan Kleiner


  • Article summary

Catena Media has announced a programme of organisational and leadership changes to try and improve its performance from Q1 2024.

The affiliate noted that changes are essential for the company to target organic revenue growth in the second half of the year. It blamed unsatisfactory operational outcomes in North American sports as one reason behind the results, including operator marketing budgets which it says squeezed user traffic and reduced recruitment of new depositing customers (NDCs).

Sizeable change

There have been big changes at Catena recently, with Michael Daly resigning as CEO in February and Pierre Cadena stepping in as interim CEO. Manuel Stan will come in to take the role on 1 July.

The affiliate also appointed Michael Gerrow as group chief financial officer and promoted Edward Midolo, who has spent six years with the business, to the role of chief technology officer.

It has also proposed bringing back Erick Flinck as the new chairman of the board with the motion set to be voted on at Catena’s AGM on 15 May.

To achieve the turnaround, Catena has launched initiatives in technology leadership, strategic product development, operational efficiency and multichannel structure.

It also noted thatkey productswithin its portfolio will be managed as distinct entities with a clear mission, vision and brand purpose. This is taken to mean brands will be run according to individual needs and interests.

Technical upgrade

Cadena said that he has led the mission to embed the new product-first structure across the organisation since he joined the company last November, originally as VP of strategy.

“Our close focus on product development is not solely about optimisation; it is also about transforming how we create and deliver value,” said the interim CEO.

“Social and sweeps casino is a good example. Here we are broadening our products to capitalise on regional synergies across the US as a route to enhancing our visibility and engagement rates. We saw positive initial impacts of this strategy in Q1.

Cadena also stated the company had launched its AI platform on one of its sports sites during Q1 and that the platform had now been integrated into a second site. He confirmed Catena is still developing a sub-affiliation network and working on media deals.

“In media partnerships, we are looking to expand existing successful deals while also exploring new media avenues,” he said.

“In paid media, we are currently in a pilot phase and are seeing positive results from early campaigns. This vertical is still in its infancy, but we hope to launch a product in Q3 if our efforts proceed according to plan.”

Key results

Catena reported revenue in its core market North America was down by 50.5% at €14.3m, which makes up 90% of its total revenue for the quarter. Sports betting revenue in the region nosedived to €5.5m, a decrease of 71.9%. Casino revenue in North America also dropped to €8.8m, a 15.4% decrease.

In its rest of the world operations, Catena saw a 35.5% drop to €1.68m and suffered a 46.26% decrease in casino activities to €1.07m. Sports operations, meanwhile, saw a comparitively small 1% drop year-on-year for Q1 from €611,000 to €607,000.

As mentioned, Catena’s NDC results were down during the period as it recorded a 54% drop from Q1 2023. Adjusted EBITDA suffered a 117% reduction year-on-year in the opening three months, down to €1.93 from €11.11m.

Interim CEO Cadena said the company expects to expand the leadership rebuild in the near futurewith senior appointments for product and commercial roles”, which he hopes willdrive the business forward after several recent disappointing quarters”.

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