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Codere reduces its income by 21.3% in the first quarter of the year due to the coronavirus

Friday 29 de May 2020 / 14:06

⏱ 2 min read

(Madrid).- Codere, a leading multinational company in the private gaming sector, today announced its results for the first quarter of 2020, which were approved yesterday by its Board of Directors.

Codere reduces its income by 21.3% in the first quarter of the year due to the coronavirus

The group obtained operating revenues during this period of 278.5 million euros, 21.3% less than the previous year, as a result of the temporary closure of the face-to-face business due to the restrictive measures against COVID-19 imposed in all its markets since last March 8. However, online activity registered a growth of 7.6%, although it has also been affected by the suspension of sports competitions.

As for adjusted EBITDA, the company reached 47.7 million euros in the first quarter of 2020, a year-on-year decrease of 41.1% due to the drop in all business units, except for Uruguay and its online activity.

The company's net profit resulted in a net loss of 97.1 million euros, compared to 8.6 million euros in the same period in 2019, as a result of the appreciation of the dollar against Latin American currencies and the first impacts of COVID-19.

The investment in this first quarter of 2020 was 13.8 million euros, 15.9% below that recorded in the first quarter of 2019.

At 31st March 2020, Codere had 150.1 million euros in cash to pay the coupon that had been deferred in April, within the grace period.

In terms of capacity, the company has reduced the number of machines by 1.8% to 55,646 units, while the number of gaming rooms remains at 148 and sports betting shops have decreased by nearly 25.7%, from 330 to 245.

A complicated international scenario

The impact of COVID-19 on Codere's business has been very significant, as it has meant the temporary closure of all its on-site operations gradually from 8 March. Only the online business has continued to function normally, although strongly affected by the cancellation of the main sports competitions. As of today, only the races at Uruguay's racetracks, as well as some points of sale in Spain have resumed operations; the rest of the markets are expected to reopen progressively as of June.

In this context, the company implemented a contingency plan to preserve its liquidity and guarantee business continuity, limiting cash outflows only to established critical elements (personnel, rents and taxes, among others), managing to reduce its fixed operating expenses by 56.5% during this period of closures. In addition, and as a support to its liquidity, at the beginning of the crisis (March 13th), the company obtained a bank loan for 500 million pesos in Mexico, with maturity in 2025, and disposed of its corporate revolving credit line in its entirety.

Codere has also sought additional liquidity with the support of financial advisors, with the aim of obtaining an additional 105 million euros to enable it to face this period of uncertainty regarding the evolution of the pandemic and its implications regarding when and under what conditions it can reopen its operations.

Codere's current cash position is 121 million euros, which after the payment of the coupon foreseen before May 30 will remain at 83 million euros.

Categoría:Others

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País: Spain

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