Raketech has ended 2022 with a strong fourth quarter featuring year-over-year revenue growth of over 30 per cent, with CEO Oskar Mühlbach stating he is “very satisfied” with the company’s performance.
As a result, the online affiliate and content marketing firm has changed its existing financial targets to more detailed near-term guidance for revenues, EBITDA and free cash flow to better reflect the company’s current business mix.
Raketech ‘well-positioned’ in global market
Posting its Q4 results, Raketech declared revenues of €15.7m, a 32.5 per cent improvement YoY (Q4 2021: €11.8m) as its “core portfolio of affiliation marketing assets showed continued strong performance” alongside its sub-affiliation offering expansion and “recent acquisitions focusing on US sports”.
For the full year, the company’s revenue came in at €52.7m, a 36.7 per cent increase YoY (FY 2021: €38.5m), which Raketech says is in line with its previous guidance.
Adjusted EBITDA for Q4 came in at €6.3m, up by 15.9 per cent YoY (Q4 2021: €5.4m) as the firm expected.
However, due to changes in the market and product mix, with “increased investments into the US and Affiliation Cloud”, the adjusted EBITDA margin fell to 40.3 per cent (2021: 46.0 per cent). Profit for the quarter finished at €2.7m, a 7.1 per cent decline YoY (2021: €2.9m).
For the full year, adjusted EBITDA stood at €20.2m, growing by 22.4 per cent YoY (2021: €16.5m) thanks to “higher revenues through organic growth and added revenues through the latest acquisitions”.
The adjusted EBITDA margin was 38.3 per cent (2021: 42.8 per cent), while profit for the year ended at €8.3m, a 19.3 per cent improvement YoY (2021: €7.1m).
Mühlbach commented: “I am very satisfied with our performance during Q4. Our core affiliation assets are performing according to plan or better, including those handed over to us after earn-out periods.
“With our diversified portfolio within Affiliation marketing, Sub-affiliation and Betting Tips & Subscriptions, we believe we are well-positioned to capture the many opportunities presented by the rapidly growing global digital gambling market.”
Per segment, casino revenue for Q4 came in at €11.5m, a 24.6 per cent increase YoY (2021: €9.2m), accounting for 73.3 per cent of the total revenue. Sports generated revenues of €4.2m, a 60.2 per cent growth YoY (2021: €2.6m), which was 26.7 per cent of the total revenue.
Per region, Raketech’s revenues from the US hit €2.4m during Q4, a significant increase compared to the previous year, growing by 149.3 per cent (2021: €980,000) due to the company’s US sport focused acquisition in late 2021 and the FIFA World Cup.
Elsewhere, Nordic revenues grew slightly by 1.6 per cent during the same period to €6.5m (2021: €6.4m), Rest of World revenues rose by 60.9 per cent to €6.1m (2021: €3.8m), while Rest of Europe revenues declined by 5.4 per cent to €644,000 (2021: €681,000).
Updated 2023 guidance
To reflect its current business mix following the decision to expand the Saas product AffiliationCloud and the US Tipster services, Raketech’s board has replaced its existing financial targets with near-term guidance for revenues, EBITDA, and free cash flow.
The company expects revenues, excluding acquisitions, to reach the region of €60-65m in 2023 thanks to “strategic growth initiatives”, while EBITDA is expected to come in between €20-24m, including operational costs of approximately €2m following its takeover of Casinofeber and Infinileads, following the end of the earnout period.
Raketech added that it expects free cash flow to grow substantially to around €11m-€13m, including approximately €6m following the integration of Casinofeber and Infinileads, allowing the company “to continue to be active within the area of M&A, keep investing into organic growth while continuously also pay dividends to shareholders in line with current policy”.
The firm has also identified three long-term growth initiatives that it intends to focus its investments into – fewer but better consumer products focusing on popular and established brands, AffiliationCloud application in an identified large and growing market, and adding affiliation to its US pickster assets.
Mühlbach noted that these three growth initiatives, alongside the global shift to online gambling, puts Raketech ‘in a good position for continued expansion’.
The CEO added: “With our diversified portfolio within affiliation marketing, sub-affiliation and betting tips and subscriptions, we believe we are well-positioned to capture the many opportunities presented by the rapidly growing global digital gambling market.”