Codere showing signs of recovery following LatAm reopening

Codere is confident of bouncing back from COVID-19 induced headwinds, having identifying a resurgence in Latin American countries as the jurisdictions gradually reopen after months of lockdowns.

Providing a financial update for the first nine months of 2021, the Spanish gambling group explained that it had generated total revenue of €499.6 as of September 2021, an increase of 8.5%.

Codere further disclosed that it was closing the time period with €86 million in cash, having recorded a net loss of €243 million in comparison to €240 million in the corresponding period in 2020.

Meanwhile, adjusted EBITDA grew by 90% to €54.4 million, which Codere attributed to ‘best results in all markets’, with the firm’s EBITDA margin increasing by 4.7% year-on-year to 10.9% as a result of the “reactivation of the business and the rigorous efficiency measures implemented throughout this period”.

A reactivation of the firm’s operations in the third quarter of 2021 was identified as the primary reason behind the start of its recovery in the latter phases of the year, starting with the reopening of the national markets in the countries of Argentina and Uruguay.

Of the group’s business units, Mexico, Argentina, Spain and its online divisions experienced the greatest success, with growth rates of 50%, 26%, 22.5% and 22% respectively, whilst total turnover ending September increased by 18% on the first nine months of 2020.

However, Italy and Uruguay have continued to pose some hurdles due to vaccination certification requirements in the former and the closure of the Hotel Casino Carrasco in the latter, although Codere predicts that the casino will be able to resume operations this month.

Closing its update, Codere detailed that it also expects to complete the $350 million merger of its online gaming subsidiary with SPAC DD3 Acquisition Corp. II later this month, to create a Nasdaq-listed Latin America-facing web-based gambling platform – Codere Online.

Additionally, the group also maintains that its extensive bond restructuring will also be finalised by 19 November. The restructuring was initially announced towards the end of April, a result of an agreement with its stakeholders which would see a cash injection of €225 million.

A caveat of the deal between the company and its shareholders would see it liquidated, and its assets transferred to a new corporate structure in order to ensure its variability.