Argentina’s worsening economic crisis has taken its toll on Codere’s operating profits according to the financial results for the quarter and six month period ended June 30, 2018.
The results, which were published last week, reflected an increasingly grim picture in Argentina where the peso fell to a record low at the end of last month. This was after President Mauricio Macri said that he has asked the International Monetary Fund to speed up delivery of a US$50 billion bailout package. The value of Argentina’s peso continued to fall on August 30th, plunging by more than 13% after a 7% drop a day earlier.
According to Codere, in H2 2018 Operating Revenue decreased by 6.8% to €759.3m compared to H1 2017, driven by a significant decline in its Argentine revenues “due to the acute devaluation of the Argentine peso versus the euro.” However, Argentina’s currency woes were “partially offset by revenue increases in Spain and Italy. In constant currency terms, Group Revenues for the period would have grown by 11.4% versus H1 2017,” the company said.
Overall operating revenue decreased by €55.2m or 6.8% to €759.3m in H1 2018, due to the decrease in revenues in Argentina (€67.5m) and Mexico (€6.9m) partially offset by Spain (€17.8m) and Italy (€6.4m).
The company reported that H1 2018 Adjusted EBITDA reached €132.9m, 1.1% above H1 2017. Codere classified this slight increase as “remarkable in a context of higher gaming taxes with respect to last year (Italy and Argentina) and the unfavourable FX trends, especially as the Euro appreciated 53.0% versus the Argentine peso, but also versus other Latin American currencies and the US Dollar.”
In the twelve months ended March 31, 2018, 67% of the company’s revenue was generated in Latin America and 33 per cent in Europe.
Source: GMB / G3 Newswire
