The online gambling subsidiary of Spanish-based Codere Group released its second quarter earnings report today, posting double-digit growth in revenue year-over-year.
Stable Growth Path
Codere Online revealed that, in the three months ended June 30, 2021, the business generated €21 million ($24.4 million) in net gaming revenue, up 43% on €14.7 million ($17.1 million) in the second quarter of 2020. This was mainly fueled by the company’s Latin American operations.
Net gaming revenue from the business in Mexico jumped 108%, from €3.1 million ($3.6 million) in Q2 2020, to €6.4 million ($7.4 million) in the second quarter of 2021, while revenue in Spain increased by 23% to reach €12.6 million ($14.6 million), compared to €10.3 million ($12 million) in the respective quarter of the prior year.
Our second quarter results reflect the strong revenue trends in Spain and substantial growth achieved across Latin America, with a 43% year-on-year increase in our total net gaming revenue. This performance was driven by a 142% increase in average active players in the second quarter.”Moshe Edree, Managing Director, Codere Online
Another significant development for the business in the second quarter was the decision to go public, announced in June via a definitive agreement to merge with special purpose acquisition company (SPAC) DD3 Acquisition Corp. That arrangement included a deal that valued Codere Online in the region of $350 million and, upon completion, would see the business trade on the NASDAQ. The merger should be completed by the end of Q4 2021.
The second quarter featured another important development for the business after its parent company ceded control to its US creditors, following Codere Group shareholders’ approval in May of a proposed restructuring plan put forth to save the company.
Commenting further on the results, Codere Online’s managing director, Moshe Edree, outlined the adaptability the business showed at the beginning of the quarter in its domestic market, where regulatory headwinds affected the industry. This limited the company’s ability to offer player bonuses and undertake other promotional activities like advertising and sponsorship.
Latin America Has Further Room to Grow
In Mexico, Edree continued, net gaming revenue more than doubled due partly to the impact of the coronavirus-related disruptions to sports calendars in Q2 2020, as well as the company’s omnichannel approach to customers. The migration of the Mexican platform by the end of the first quarter expanded the business’ ability to manage higher customer volume and improve customer experience, the non-employee independent contractor serving as managing director outlined.
Looking into the next quarter, Edree pointed to the continued expansion of the company’s footprint in the Latin American region once the combination with DD3 is complete, citing 4-year agreements Codere Online reached after the second quarter closed, with key soccer teams in Mexico, Monterrey Rayados, and Argentina, Club Atlético River Plate.