Catena Media faced ongoing financial difficulties in the second quarter of 2023, reporting a substantial revenue reduction resulting in a considerable net loss.
Revenue from continuing operations for Q2 2023 reached €16.9 million, reflecting a 16% decline compared to the corresponding period last year. This decrease was evident across all geographic segments, including Catena’s primary market, the US, which saw a 16% drop to €12.5 million.
This revenue downturn has persisted since Q2 2021, underscoring the persistent obstacles confronting the company. Catena’s adjusted EBITDA (encompassing discontinued operations) also experienced a significant 70% year-over-year plunge to a modest €2.8 million, representing a four-year nadir.
These financial indicators present a challenging outlook for Catena, with its market capitalization currently at SEK 1.28 billion against a net debt of €21.3 million. The company’s choice to disclose revenue from continuing operations and total revenue (including discontinued operations) distinctly emphasizes the effects of its restructuring initiatives and the difficulties within its core operations.
Catenas fiscal performance throughout the last year reveals a business undergoing a substantial shift. Although their earnings, encompassing discontinued business lines, exhibit a comparable trajectory to prior periods, their adjusted EBITDA presents a contrasting narrative.
During the second quarter of 2022, Catena declared an adjusted EBITDA of €9.1 million, a considerable reduction from the €14.9 million documented for the corresponding timeframe in 2021. This number closely aligns with the €14.8 million adjusted EBITDA announced in the second quarter of 2020, which incorporated income from discontinued operations.
Concentrating on ongoing business segments, Catena’s adjusted EBITDA for the second quarter of 2023 stood at €2.6 million, a 60% decline compared to the €6.5 million recorded in the second quarter of 2022. This downturn reflects the pattern observed in their revenue.
The company’s strategic realignment towards regulated North American markets has also influenced its profitability. Catena’s profit for the second quarter of 2023, attributed to parent company owners from continuing operations, plunged to a €2 million deficit. This sharply contrasts the €432,000 profit reported in the same quarter of 2022.
Incorporating discontinued operations, Catena’s total losses for the quarter escalate to a significant €18.2 million.
Despite these hurdles, CEO Michael Daly maintains a positive outlook, highlighting the company’s ongoing metamorphosis and dedication to achieving positive cash flow with a concentrated emphasis on the regulated North American market.
Moving forward, the primary objective is to maintain a leading position and achieve financial goals. The company is targeting a positive net cash position by year-end. Furthermore, by 2025, the ambition is to attain North American earnings of $125 million per annum, with an adjusted EBITDA margin surpassing 50%.
Daly presented his roadmap for Kaidener’s future at the GI Huddle Conference in June.
Additionally, Kaidener recently published their financial performance for the initial six months of 2023. Overall income reached €50.6 million, marginally below the €55.9 million recorded during the corresponding period last year.
Adjusted EBITDA also declined to €22.7 million in the first half of 2023, contrasting with €28.4 million in the first half of 2022. Net income attributable to parent company shareholders from ongoing operations for the first six months of 2023 was €10 million, a decrease from €16.8 million in the first half of 2022.
At the close of June 2023, Kaidener held total liabilities of €61 million, cash, and cash equivalents of €38 million, leading to net debt of €23.1 million.
The company’s shares reached their peak value this year on February 16th, hitting SEK 37.54. Currently, it possesses a market capitalization of SEK 1.28 billion.
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