XLMedia has published a pre-close trading update for 2023, noting that it has explored possibly selling the whole company but has been unable to find suitable value for its assets.
In addition, the company’s North American revenues for the year are expected to finish strong but below previous forecasts, group revenues to be between $50m and $52m, while adjusted EBITDA is expected to be in the range of $12m to $14m.
Regarding M&A activity, XLMedia noted that following the sale of three European casino assets in July, the company’s board is exploring further asset sales opportunities and has had early talks with potential purchasers.
However, the board stated that there is “no certainty that any sales will be completed”.
XLMedia has also explored the possibility of selling the entire company over the past couple of months. While there has been a “demand for the assets”, a sale of the whole company is “unlikely to create the most value for shareholders”.
The company added that no discussions are currently ongoing regarding a sale, so the board “does not plan to undertake the sale of the whole company at this time”.
Examining its performance over the second half of the year, XLMedia noted that North American revenues earned in previous years from August through October have, in part, moved back to mid-November onwards following the withdrawal of the Barstool brand and the subsequent launch of ESPNbet.
A reduced level of customer acquisition marketing activity by some operators was seen by the company as well, resulting in a “significant change in the revenue profile” of the company’s North American activities.
Yet, XLMedia did state that the group benefited from the mid-November launch of ESPNbet, which uplifted revenues and is expected to “deliver a strong close” to 2023 in the region.
Although the company highlighted an opportunity to “generate significant revenues” in the remainder of the year with December’s acquisition budget, it is not expected to “fully compensate for mid-period shortfalls”, and as a result, North American revenues will now “fall below previous forecasts”.
In Europe, XLMedia added that Nettikasinot, Whichbingo and Freebets “remain on track to deliver strong year-on-year growth in the full year”.
Looking ahead, the group expects “continued progress” in 2024 from its European brands, while also expanding upon its North American-owned and operated brand and media partner footprint.
