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Interim report Q3 2019

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THIRD QUARTER 2019

  • Total revenues amounted to EUR 6.0 million (EUR 7.0 million) representing a decrease of 15.1%.
  • Organic growth amounted to -17.9% (28.6%).
  • Adjusted EBITDA decreased by 34.2% to EUR 2.7 million (EUR 4.1 million), corresponding to a margin of 45.5% (58.7%).
  • Adjusted operating profit amounted to EUR 1.5 million (EUR 3.7 million), corresponding to a margin of 25.1% (52.4%).
  • Profit for the period decreased by EUR 0.5 million from EUR 1.7 million to EUR 1.2 million.
  • Earnings per share before dilution amounted to EUR 0.03 (EUR 0.05) representing a decrease of 38.5%.
  • NDCs (New Depositing Customers) decreased by 0.2% to 26,782 (26,837).
     

FIRST NINE MONTHS OF 2019

  • Revenues increased by 0.7% to EUR 18.1 million (EUR 17.9 million).
  • Organic growth amounted to -3.7% (22.6 %).
  • Adjusted EBITDA decreased by 8.6% to EUR 9.0 million (EUR 9.9 million), corresponding to a margin of 50.0% (55.1%).
  • Adjusted operating profit amounted to EUR 6.2 million (EUR 8.9 million), corresponding to a margin of 34.4% (49.7%).
  • Profit for the period amounted to EUR 7.5 million (EUR 2.8 million) representing an increase by 165.9%.
  • Earnings per share before dilution amounted to EUR 0.20 (EUR 0.10) representing an increase of 100.6%.
  • NDCs (New Depositing Customers) increased by 26.4% to 80,364 (63,599).

EVENTS DURING THIRD QUARTER 2019

  • Casumba Media Ltd., a Maltese registered media company, was acquired during the quarter for the agreed purchase price of EUR 2.0 million with the possibility of additional earnouts based on certain performance measures. Casumba offers an extensive amount of affiliate websites in the Japanese market and through the acquisition Raketech gets an immediate footprint in Japan as an emerging market in iGaming.
  • During the quarter Raketech has repurchased in total 108,000 own shares. The share repurchases have been carried out within the buy-back programme authorised at the annual general meeting held on 8 May 2019.
     

SUBSEQUENT EVENTS AFTER THE END OF THE THIRD QUARTER

  • On 1 October it was announced that the current Chief Financial Officer, Andreas Kovacs, has been appointed as Director of Business Development, a new role, and Måns Svalborn will join as CFO. Måns will officially take over as CFO on 1st December 2019.

CEO MICHAEL HOLMBERG COMMENTS ON THE QUARTER

“In the third quarter, both revenues and the number of NDCs increased compared to the previous quarter, despite a continued challenge in the Swedish gaming market. We have a positive underlying revenue development with an increased revenue share, which drives recurring revenues – however, this will come into full effect during the upcoming years. During the quarter, we continued to focus on global expansion, with concrete progress in both Japan and Germany. All in all, this gives us confidence for the future, even though the result for the third quarter is unsatisfactory.

Our products continue to generate high traffic levels for our partners. The underlying NDC development is on par with the previous year, despite changing conditions in the Swedish market. The NDC growth of 7 percent compared to the second quarter shows strength in customer acquisition and traffic. I am glad that we can show a strong operating cash flow for the quarter of EUR 3.2 million, which is 41 percent higher than the corresponding period last year.

For the first time ever, Raketech's operations outside of the Nordic region accounted for 10 percent of the revenue mix, with contributions from Germany, Canada, New Zealand and Japan amongst others. This is thanks to the ongoing efforts to expand geographically.

In brief, the expansion strategy means that we will operate in at least three continents, and each continent will represent at least 10% of the company’s revenues over time. This is a clear strategy that we are executing. I am certain that we will be successful in building a global company, with products in sports and gaming that serves operators, media companies and other businesses with a focus on responsible and user-focused services.”

PRESENTATION FOR INVESTORS, ANALYSTS AND THE MEDIA

CEO Michael Holmberg and CFO Andreas Kovacs will present the report and answer questions in an audiocast at 9.00 a.m. CET on 21 November. The presentation will be held in English and can be followed online via https://tv.streamfabriken.com/raketech-q3-2019. To participate by phone, please dial +46 8 5664 2703 (SE), +44 3333 009 263 (UK)

REPORT LINK

The report is attached to this press release and also available at https://raketech.com/investor/

FOR MORE INFORMATION

Michael Holmberg, CEO, michael.holmberg@raketech.com   
Andreas Kovacs, CFO, andreas.kovacs@raketech.com

This information is such that Raketech Group Holding P.L.C. is required to publish under the EU Market Abuse Regulation. The information was submitted under the auspices of the CEO for publication at 7.00 a.m. CET on 21 November 2019.

About Raketech Group

Raketech is a leading online affiliate and content marketing company, specialised in comparison services for sports and gaming, online guides, communities and social media products in primarily the Nordic region and the UK. Through some 20 flagship brands, Raketech guides sports and gaming enthusiasts to the best possible services, while also delivering high-quality traffic and leads to its partners. Raketech grows both organically and via acquisitions and operates its business in accordance with a clear framework for responsible affiliate marketing services. The company’s shares are listed in Nasdaq First North Premier Growth Market with ticker RAKE. Erik Penser Bank AB is the company’s Certified Adviser (certifiedadviser@penser.se / +46 8 463 83 00).  For more information, visit www.raketech.com.

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