Affiliate Catena Media has released a Q2 update stating that preliminary results from May have been negatively impacted by changes in Google’s organic search policies – subsequently affecting its financial forecast for the quarter.
The changes made to Google’s organic search policy are related to site reputation abuse and have, according to Catena, had a knock-on effect that renders some of its strategic media partnerships less effective than the group's predictions. This has led Catena to issue an update on its quarterly forecast, with revenue expectations now falling at €12.5-13.5m ($13.3-14.4m) and adjusted EBITDA at €0.5-1.5m.
Although the company states that the financial impact on the affected media partnerships cannot be quantified into exact figures, previous full-year EBITDA predictions can now be regarded as inaccurate. Despite this setback, Catena remains confident of revenue growth in H2 of 2024.
Commenting on the update was Catena Media Interim CEO, Pierre Cadena, who said: “Catena Media is embedding a new product-focused operating model as part of our efforts to reestablish the company as a healthy business. We believe that this is the right action in our strategy and we still forecast a return to sustainable growth with high-margin operations from the second half of 2024.
“As a result of these changes, combined with the proceeds from our recent divestments, our balance sheet will be much healthier. This provides us with further financial flexibility and strengthens our ability to repay our senior bond next year and to confidently manage the business debt load.”
An upturn in revenue would be a welcome sight for Catena stakeholders, as the group’s Q4 2023 and Q1 2024 results revealed a 41% and 49% revenue decrease respectively.
However, the appointment of a new CFO in Michael Gerrow and new CEO in Manuel Stan spells a new phase for Catena as the company attempts to turn the corner.
