XLMedia reports H1 revenue slide in aftermath of asset sale to Gambling.com Group
London-based affiliate records revenue of $10.4m for the first half of 2024, down 38.5% from the previous year, as full-year adjusted EBITDA expected to land at $5m for continuing operations
XLMedia has recorded revenue of $10.4m (£8.1m) for the first half of 2024, down from $16.9m in the corresponding period of 2023, as part of the affiliate’s continuing business operations.
The continuing business operations include the North American division and “small residual income from Europe” after XLMedia sold its European and Canadian assets to Gambling.com Group, in a deal which was finalised in April 2024.
XLMedia gained a fixed fee of $37.5m from the transaction, with a further $5m based on revenue performance tacked on as a potential earnout.
Bosses confirmed $20m of the fixed fee has already been paid, with the next installment of $10m due in October 2024. Shareholders are expected to see a return from the proceeds of the sale by Q4 2024.
Revenue for H1 from continuing operations hit $10.4m, predominantly made up of $9.8m from North America, down from $16.2m in H1 2023.
A further $600,000 of revenue came from residual income of the company’s remaining European business, which XLMedia said was a legacy network business that was not included in the Gambling.com Group deal.
Revenue from discounted operations, which only relate to Q1, amounted to $5.2m, down from $12.5m in H1 2023.
The affiliate was boosted by the launch of online sports betting in North Carolina in March, which led to solid growth in customer registrations despite the fact the NFL season had already ended.
Management said the “good growth” in the Tar Heel State offered the “prospect of a further revenue uplift when the new NFL season launches”.
According to the company, the North America revenue decrease in H1 2024 compared to last year can be attributed to the launch of sports betting in Ohio (January 2023) and Massachusetts (March 2023), which helped boost revenue figures in H1 2023.
In terms of the full-year outlook, XLMedia said it estimates adjusted EBITDA to come in at around $5m for its continuing business operations as it benefits from the NFL season and “reductions in the central cost base serving the continuing business”.
A company statement said: “The North America business is seasonal, and the company is seeing the normal seasonal dip in sports revenues during the NFL off-season.
“With no further state launches confirmed, the group is focused on preparing for the new NFL season and optimising performance in existing legalised sport and gaming states.
“The group continues to diversify revenue with daily fantasy sports, paid media, advertising and sponsorship, as well as building its gaming presence for longer-term growth.”
XLMedia also addressed its plans to navigate the latest Google updates from May 2024.
The statement continued: “Following Google actions in May 2024 which reduced visibility of some publishers’ sports betting and gaming content, the group is working closely with all its media partners, the majority of which, to date, have not been negatively affected by the actions, while successfully relaunching content with a small number of those that were temporarily impacted, while the group’s owned and operated sport affiliate websites are currently benefiting from improvements in their rankings.”
Finally, a brief note attached to the trading statement added that the XLMedia board is continuing to evaluate ways to maximise shareholder value.
Back in May, XLMedia chair Marcus Rich suggested that the company would entertain serious offers for its US business.