Codere Maintains Profit Goal Despite Argentina’s Economic Woes

Codere continues to hold its earnings goal in spite of Argentina’s economic difficulties, according to iGB.

Codere continues to hold its 2019 profit goal in spite of the sharp depreciation of the Argentine peso. Argentina is one of the operator’s main markets.

Earlier this month, the peso plunged after primary election results indicated that Peronist opposition candidate Alberto Fernandez would defeat market-friendly incumbent Mauricio Macri in the October election.

However, Codere stated that while its adjusted earnings projection for Argentina has been reduced to between €61 million and €66 million from €67 million to €72 million since it released its first-quarter results in May, its overall EBITDA goal will remain unchanged at between €280 million and €290 million.

Codere stated that “in spite of the devaluation of the Argentine peso, the group’s performance remains stable due to the better-than-expected performance of markets such as Mexico and Uruguay.”

Specifically, adjusted EBITDA climbed from €65 million to €70.3 million, an increase of 8.2% year-on-year, in spite of a 29% decline in Argentina from €24.4 million to €17.3 million in the same period.

Cordel highlighted that the robust performance of Mexico, Spain, Colombia, and Uruguay resulted in a 30.5% annual increase in group income during the second quarter, excluding Argentina, surging from €40.6 million to €53 million, suggesting a diminished dependence on the Argentine market.

While Argentina’s second-quarter income decreased by 27.2% year-over-year, dropping from €109.9 million to €80 million, revenue outside the nation expanded by 3.3%, climbing from €266.1 million to €274.9 million.

Despite a 5.6% dip in overall group revenue during the same period, falling from €376 million to €354.9 million, Cordel stressed that non-recurring costs in the first half of 2019 were over 50% lower than the corresponding period in the previous year.

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