Codere reports a negative Q3 2018

Codere yesterday reported financial results for the third quarter of 2018, and the accumulated results of the first nine months of the year. Accumulated operating income for the period between January and September 2018 was 1.115,6 million euros, 8,2% down compared to the same period in 2017.

This drop has been caused mainly by a severe devaluation of Latin American currencies against the euro, especially the Argentine peso. At a constant currency rate, the Group’s revenue increased by 10,4%, against last year. The European segment’s operating income was up 9%, compared to last year’s, which reflects a 19.8% rise in Spain and 2.6% in Italy.

Adjusted EBITDA was 203.6 million euros for the period between January and September 2018, 1.8% up against the same period in 2017. These results reflect the impact of operating and efficiency enhancement measures and the resiliency of the company towards a difficult macroeconomic and regulatory environment marked by tax increase – especially in Italy and Argentina, and the devaluation of Latin American currencies.

Net loss for the period was 55 million euros, due to the losses generated by currency devaluation and Argentina’s inflation, as well as non-recurring expenses related to the company’s transformation driven by its new leadership. Net income, excluding the abovementioned effects, would be of 22 million euros.

Investments made during the accumulated 9-month period were 113.600 million euros, 4.5% up against 2017. 55,000 million were used for maintenance projects and 57,000 for expansion, especially to boost the machine’s business in Mexico and Panama.

In terms of capacity, the company’s number of machines was up 1.1%, with 56.219 units compared to 55.599 units in the same period of 2017. Machines in Spain and Mexico were up 10.6% and 9.1%, respectively. The company maintains 144 gaming halls and sports betting facilities are to be up 52.5%, totaling 7,152.

Codere’s CEO, Vicente Di Loreto commented: “Despite the fact that Argentina’s current economic crisis has affected our final results, we have a solid base to cope with this situation while keeping the strategic lines of our company. During this period, we managed to maintain an increasing adjusted EBITDA, as well as expansion margins that will allow us to continue consolidated our position in the market and our capacity to generate positive results.”