Raketech issues profit warning
Total revenues for Raketech are expected to amount to EUR 5.8 million. Reported EBITDA is estimated to EUR 1.6 million, which is below expectations. The reported EBITDA is affected by extraordinary cost items amounting to EUR 0.4m and loss allowance for trade receivables amounting to 0.3 million during the quarter.
Furthermore operating profit during the fourth quarter is affected by extraordinary items which relate to revaluation of Goodwill of EUR 0.3m, without any cash effect, as a consequence of the continued PPC-ban in Sweden.
The extraordinary items affecting EBITDA of EUR 0.4m relate to the total amount of the severance pay to the former CEO who was replaced by Oskar Mühlbach as of December 11, 2019, and with reallocation expenses for the move of the Company’s Danish office during the fourth quarter.
The revaluation of goodwill relates to the acquisition of Shogun Media predominantly attributable to know-how within paid media in Sweden, an acquisition completed in June 2018. The uncertainty regarding when Google’s paid media channel will open-up to advertisers taken into consideration, the Board of Directors has decided to write down the goodwill value of EUR 0.3m during the fourth quarter.
The loss allowance for trade receivables is a consequence of the management’s revaluation of the trade receivables portfolio, in line with IFRS 9.
Oskar Mühlbach, CEO at Raketech said: “Despite the continuously challenging Swedish market I am pleased to conclude that we are able to deliver revenues with only a minor drop compared to the third quarter, which is within expectations. This minor drop in combination with the extraordinary cost items including the loss allowance, however, results in an EBITDA which is less pleasing. The fourth quarter had a particularly slow start but finished off confidently with a generally good performance from our entire product portfolio.”