Stocks Tracker: Affiliates’ 2022 performance in review
In the second of a three-part series, EGR looks at some of the industry’s largest public firms and their annual performance in another tumultuous 12 months for the sector
Better Collective
2022 opening: SEK204.50
2022 decrease: -25.87%
Market cap: SEK7.34bn
Better Collective had what could be described as a mixed 2022 after hugely promising financial results were offset by difficulties in its ambitious US expansion plans which led to the cutting of up to 10% of its workforce stateside.
The news, exclusively revealed by EGR, saw staff from across key US brands depart including VegasInsider, RotoGrinders, ScoresAndOdds as well as Better Collective’s flagship US property, Action Network in October.
Confidential sources suggested planning for the cuts began in September at high level, with both Better Collective executives and US brand heads involved.
The news of the departures somewhat soured Better Collective’s approach to the US up until that point, which had seen the establishment of a New York headquarters in Manhattan.
Better Collective had previously aimed for $100m in revenue in 2022, with CEO Jesper Søgaard promising a “very aggressive” approach to the US market.
Earlier this year, Søgaard said: “We see a lot of opportunity in the US and have made the decision to invest significantly in that market. That is also related to adding people and making sure we get the best content writers and people to manage the business.
“It is a very aggressive approach, but we really believe we should go for the opportunity,” he added.
In Q2, Better Collective reported a 90% year-on-year (YoY) leap in US revenue, which slowed down to a 17% YoY increase in Q3.
The US and the rest of the world segment combined for a group revenue jump of 32% for the affiliate giant, but even strong finances and a healthy M&A pipeline was not enough to abate a downturn in stock market fortunes.
Source: Google
Catena Media
2022 opening: SEK54.78
2022 decrease: -60.83%
Market cap: SEK1.54bn
A difficult year for Catena Media ended with a welcome boost as the firm was able to offload offloaded? its AskGamblers subsidiary and brands to Gaming Innovation Group (GiG) for a total cost of €45m.
The deal allowed Catena to recoup some funds for its plans for an exerted push towards the US, which saw the affiliate put its Europe-facing assets under strategic review back in May.
The review also put the group’s UK and Malta staff at risk from redundancy, with Catena confirming following its Q3 results announcement it had cut 25% of its European headcount.
Additionally, at the time, Catena disclosed it had also offloaded its assets in grey markets, amounting to a disposal of €12.8m, as it continues to eye sustained growth in North America.
Speaking on the sale of AskGamblers, CEO Michael Daly said: “Today’s agreement is a major step on our journey to focus the business on online sports betting and casino affiliation in high-growth, regulated markets in the Americas.”
Earlier this year, Daly told EGR it was of paramount importance for the business to focus on North America if it were to succeed in the future.
Daly said: “North America has to be our focus. We’ve made indications at possibly listing there because the investor market is also different and growing.
“The ROI is better in North America right now than anywhere else. We’d be doing a disservice to our shareholders and our teams everywhere, even if we’re not putting as many dollars into Europe as we are in North America,” he added.
However, disappointing financial results, including a 111% downturn in EBITDA in Q3, failed to impress the market with the group’s share price down 60% since the start of the year.
Source: Google
XLMedia
2022 opening: 36.75p
2022 decrease: -57.64%
Market cap: £40.02m
The end of September proved to be a key turning point in XLMedia’s stock market fortunes as investors reacted poorly to the group’s confirmed H1 results, which saw delivered? a devastating blow to the personal finance division which was downgraded to a “marginal activity”.
The arm returned revenue of just $800,000, down from $6.6m in H1 2021, with the division impacted by platform changes and shifts in Google’s search policy.
Earlier this month, XLMedia confirmed it was exploring the potential sale of its faltering personal finance assets as a way of reallocating resources to power its US sports betting drive.
At the time of the release of the H1 results, XLMedia said: “The decline in revenue has significantly impacted the group’s revenue and profit performance during the period.
“Following the move of the business from Israel to the US, the focus of the team has been to commence the migration of the sites to a new platform, refresh the content to meet Google’s YMYL parameters and prioritise two of our premium brands, Moneyunder30 and InvestorJunkie,” the statement added.
The September slip failed to be arrested and has seen the AIM-listed firm’s stock slip by more than 50% in 2022.
Elsewhere, in July, ex-JPIMedia Group chief executive David King joined XLMedia as CEO, replacing Stuart Simms who has since moved to Oddschecker.
Source: Google
All data accurate as of market close on 20 December