Gentoo Media has recorded its 16th straight record quarter in its Q4 2024 results with a 38% revenue growth, which cemented strong full-year results.
The affiliate’s revenue for the quarter was €35.9 million (£29.8 million/$37.6 million), up from 2023’s €26.1 million representing 38% growth, 28% of which was organic. EBITDA in the same period amounted to €14.3 million from €10.9 million the year before with 22.9% growth.
While revenue for the full year was up 41% to €124.5 million, 17% brought in by organic growth, as EBITDA increased year-on-year by 45% to €57.2 million.
Time for a split
The quarter marked an important moment for the company with the official split in September 2024 of GiG into Gentoo Media and GiG Software. The split introduced some one-time costs and impacted equity negatively, which became negative with -€5.9 million for the quarter and -€77.2 million for the full year, including a €50.2 million impairment of intangible assets.
Gentoo’s total assets were also down year-on-year from €272.6 million to €171.1 million, with the spin-off of the platform and sportsbook operations explained as the main driver for the decrease.
“A defining milestone in the final quarter was our strategic transition to a fully affiliate-focused business,” said Gentoo Media CEO Jonas Warrer. “There has been a considerable amount of work related to the split, and it has been a very eventful year in the industry where both challenges and opportunities have never been greater, making me even more proud of the performance we have been able to deliver this quarter.”
Year in focus
On top of its revenue and EBITDA growth across the full year, Gentoo referred 471,400 FTDs to operators, exactly the same as the previous year. However, the value of deposits for the player base was up by 39% from 2023 to €767 million.
Marketing expenses increased by 20% for the year to €32.3 million, while the share of revenue spent on marketing dropped by 4% year-on-year to 26%. While other operating expenses spiked by 57% up to €35 million from 2023 due to salaries and general corporate expenses. This increase was driven by organic development of the company and the additional expenses of the acquisition of KaFe Rocks for €35 million in December 2023, Casinomeister in June 2024 for €3 million and Titan.
Quarter highlights
Gentoo’s focus on higher value markets yielded results with the value of deposits for the player base up 27% year-on-year, while the reduction of low-value players continued and provided context for the drop in player intake by 18% from Q4 2023 to 112,400. This is broken down by 51,800 players through paid activities and 60,600 through publishing operations. The majority of players were generated on revenue-share deals, with the value of deposits placed to Gentoo’s operator partners reaching €200 million.
Another Q4 metric that the affiliate grew included profit from operating operations which brought home €7.8 million, whereas the year before the company made a loss of €129,000, potentially impacted by acquisitions in that year. However, cash flow was down in the quarter from €10 million to €7.7 million year-on-year.
The completion of SEO and content services provider Titan acquisition for €3.2 million in August 2024 already delivered material cost saving and value chain improvements during the final quarter of the year.
“We are excited to further integrate Titan into our operations in early 2025 to reap additional cost savings and to grow the business further,” added Warrer on the asset.
Key brands in AskGamblers.com and KaFe Rocks continued to perform well according to Gentoo, especially as the two Google core updates had no notable impact on the company’s portfolio of websites. In fact, one of its larger sites saw a positive spike in rankings from the update, while two smaller ones were hit negatively to combine to neutral impact.
However, the regulated igaming launch in Brazil negatively affected Gentoo’s Q4 earnings as the new regulations caused short-term challenges in the market, which the affiliate expects to improve as operators adapt.
2025 targets
The affiliate expects to hit double-digit revenue growth in 2025 and also may look to make further acquisitions.
“Looking ahead, we remain focused on accelerating organic growth while pursuing strategic acquisitions that strengthen our competitive position,” said the Gentoo Media CEO on its M&A plan for 2025.
It will also launch its next-gen and proprietary media and martech platform this year, with no date yet set on what quarter this can be expected.