Sweepstake casinos accounted for a third of Catena Media’s casino revenue, as the group’s CEO Manuel Stan emphasised his belief that the sector would continue to grow.
The firm underlined that the casino growth is ‘a reflection of its aggressive program of measures’, as it pursued the expansion of social sweepstake casinos.
There was an undeniable sentiment felt as the company updated its investors, stating that the focus on sweepstake casinos would be integral to its growth as it looks to turn around an overall fall in revenue.
Stan detailed that sweepstakes are the fastest growing vertical for the firm and he believes that they ‘are very well positioned to capitalise on that growth’ of the industry.
He added: “Our products are focused on growing the sweeps vertical. I think it’s twofold. Right now, we see that generally overall in the industry being one of the fastest-growing verticals and we capitalise on it. But also, we position ourselves for post-regulation in the bigger states in the US, where we will be able to have built our databases around our brands to capitalise when the likes of California and Texas will be regulating.”
Michael Gerrow, Catena’s Chief Financial Officer, also underpinned that this can be boosted by the continued investment in the group’s technology platforms, AI, sub affiliation and paid media.
There was also an uptick as a result of the recovery of its operator-owned sites from the May Google update policy.
The laser focus on sweepstakes forms part of an enhanced strategy for the firm, as Stan detailed that with new leadership on board and the addition of a new general counsel in the coming weeks, Catena is set for a shift approach.
He stated: “In my opinion, the group has previously tried to do too many things and spread its resources too thinly, resulting in under-optimisation of core products. The new board and management agree on the need for a laser-sharp operating focus. We are now in a stronger position to concentrate on the core products and drive revenue.
“To that end, we have completed an extensive prioritisation exercise and, as a first step, we are clearing many low-performing domains to allow our teams to focus on the top products.”
In total, Catena’s Q2 revenue reached €12.8m, a decrease of 14% from the previous year, whilst adjusted EBITDA fell significantly by 67%.
Providing a positive outlook for a transformational period, Stan concluded: “I think our strategy right now is based on the three pillars that I’ve said earlier – people, product and profit. From a people perspective, the new organisational setup product base was a massive undertaking for the company, but it’s the right thing to do to position ourselves to focus on the right products.
“We have hired most of the new management team in the last three months, four months and we’ll complete that makeover by the end of the year.
“So, the key is to have the right people in place in the right roles and bring again that high motivation, high energy levels in the company. Secondly, from a product perspective, as I commented, I think Catena has done too many things in the past, has spread resources too thinly across the different products.
He added: “So, one of the key exercises that we’ve done in the last few weeks was to do a thorough framework for prioritising both our projects and our products. From a product perspective, now the entire company is focusing on a number of key products for us.
“We are reducing our website portfolio massively in the next few periods to reduce it to a number of properties, a number of products that we can manage well. And even within those, we have clear priority number one, two and three to allow the entire organisation to focus behind that.
“And lastly, from a product perspective, as we said, we’re turning all stones, trying to understand where the inefficiencies are and trying to capitalise on the opportunities. That threefold pillar will be the core of our strategy going forward.”
