Spanish multinational gambling operator Codere has reported losses of €97m for the first quarter of 2020, as the group struggles to access funding.
Codere SA, which operates online gambling, retail betting shops, gaming halls, gaming machines and racetracks across Spain, Italy, and Latin America, has seen losses grow tenfold compared to the same period last year.
The company has been hit hard by the COVID-19 crisis and resulting cancellation of sports across the world, especially in Europe and South America. Significant fluctuations of South American currencies against the US dollar and euro have also hurt performance.
Group operating revenues for Q1 2020 tumbled 21% year-on-year to €278m, with serious declines across all core operating markets. The group reported an adjusted EBITDA of €40m for the quarter.
Like other betting operators, the group has striving to reduce operating expenses, and managed to save €42m in the period, but it was too little to offset the major decline in revenue. The company says it has been maintaining operations using an extended €130m credit facility, and its corporate debt has reached €976m, while debt-net equivalents of €826m are held.
Earlier this month, Codere failed to negotiate an extension of its debt repayment terms with US bondholders Silver Point and Abrams Capital, and there is some speculation that the company will be forced to sell some business units to survive.
AYO.NEWS says:
Despite online gambling as a whole holding up well so far during the COVID-19 crisis, those operators with large retail and sports betting exposure, and existing debt, have found themselves in a very tricky situation, as revenues dry up and lenders become very risk averse.
Last month we reported that Gibraltar-based online casino supplier Nektan had appointed administrators, confirming it had failed to secure the funds it needed to keep operating.
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