The company also reported revenue for the first half of the year was also up on 2022 results, along with its reported EBITDA and operating profit.
Raketech CEO Oskar Mühlbach pinpoints the group’s success to its affiliate marketing division and its sub-affiliation business, which provides software to affiliates.
He names the group’s acquisition of Casumba Media back in 2019 for €2m as a reason for its growth in affiliate marketing. Whereas the CEO also says that targeting new regions has helped its software division revenue.
“Furthermore, the sub-affiliation business area, providing SaaS solutions and club commercials to affiliates, had an exceptionally strong quarter, driven by favourable market development, with Latin America and the Nordics leading the way.”
Mühlbach does admit that AffiliationCloud, its infrastructure solutions service, struggled in terms of revenue growth. The CEO says that the service continued to deliver to its long-term operations plan.
“Revenue growth was somewhat soft and the business area still is small in absolute numbers, compared to our other business areas”.
Q2 growth
Raketech’s record Q2 revenue at €17.6m represents a 56% increase from 2022’s €11.3m in the same period. Of the €17.6m organic growth amounted to 56%, which actually decreased by 4% from Q2 2022.
Within the group’s revenue, affiliate marketing saw a 27.8% increase to €10.3m while sub-affiliation had a rise of 191.8% year-on-year resulting in €6.3m profit.
Looking even deeper into Raketech’s profit, casino-based activities had a spike of 83.7% to €14.3m compared to 2022, while sport betting-based revenue had a smaller increase of 4.4% in terms of markets as Mühlbach’s comments suggest the group reported notable growth in the Nordics with 37% and the rest of the world, excluding Europe and the US, of 110%.
Adjusted EBITDA went up by 38.6% year-on-year to €5.5m, with operating profit seeing growth of 25.2% to €2.5m. The group’s profit margin for the period is recorded as €1.8m, another increase of 41.6%.
The group’s activities in affiliate marketing resulted in new depositing customers rising by 72.1% year-on-year to 58,117. Raketech also expanded its team in the three-month period from 113 to 143 employees contracted on a full-time basis and reduced its contractors by 19.4%.
H1 increase
The group’s performance for the first half of the year closely matches its Q2 results, with revenue reaching €33.4m at a 39.2% increase from 2022.
Affiliate marketing is up by 29.9% year-on-year and sub-affiliation by 114.3% in the same period. Betting tips and subscriptions profit has still grown by 22.6% despite only managing a 6.1% increase in Q2.
In this extended period, organic growth has increased by 38.1%, while adjusted EBITDA has risen by 28.2% to a total of €11.6m. Operating profit saw similar growth in a 21.7% rise to €6.3m.
Direct expenses by the group did also increase to €11m, which the group say was “largely driven by increased activity for sub-affiliation”.
In February, Raketech announced that it would be reducing its consumer products to support its future growth strategy. The intention, the company said was to improve the quality of its products once reduced.
Further outlook
In closing his statement, Mühlbach said that the recent success of Casumba and its sub-affiliation network has meant that he’s looking “forward to driving progress within our strategic growth focusing on our flagship products, accelerated US growth and AffiliationCloud.”
Mühlbach also confirmed that the calculation period relating to the Casumba acquisition would be ending in December, with only “exceptional events” leading to a change of the provisional amount in the earn-out.
Original article: https://igamingbusiness.com/finance/quarterly-results/raketech-set-record-q2-revenue-with-e17-6m/
