Affiliate Monitor Company by company Q1 results analysis

The troubles at Raketech aren ’ t all self-inflicted ; as with others , it can claim to have been blindsided , somewhat , by recent Google changes . Issues with the Swedish gambling markets , one of Raketech ’ s major revenue generators , can also hardly be pinned on the company .

But other issues apparent in the latest quarterly report can be said to be down to corporate misadventure . Specifically , the problems the company is having in mustering the funds to pay off the earnout on the Casumba acquisition from 2019 .

Arguably , no one would have said at the time that it would prove to be such a cross to bear . The original acquisition had Raketech buying the business for € 2m in cash upfront at a reasonable EBITDA multiple of three times EBITDA in the 12 months prior to acquisition .

Then there was a capped earnout of a further € 2.1m payable before December 2021 . Again , nothing particularly out of the ordinary there .

But what has turned out to be extraordinary is the last element of the earnout which , according to the wording of the August 2019 press release , was based

Chart 14 : Raketech revenue Q222-Q124 (€ m )

Source : company reports

on the performance until July the remaining € 20m in shares in this year . That portion , crucially , Raketech , though he didn ’ t say was uncapped . what proportion of the final sum

Fast forward to this year , nearly that would amount to . It may be five years on from the original deal , somewhat cold comfort , but he and Raketech has revealed that went on to say that on current not only has it paid out € 13m in estimates for cashflow , Raketech earnouts to the former Casumba will have the surplus to pay the owners in the last quarter but it earnout due this year . also owes them a further € 34m To make matters worse , just to be paid between now and at the point where the earnout September 2026 . comes to an end and Raketech The good news for Raketech , might hope to start to benefit such as it is , is that it ‘ only ’ has to wholly from the evident success pay a further € 14m this year with of Casumba , Google comes along the remaining € 20m to be settled and hits the operation hard with its at any point between now and the latest algo changes . 2026 deadline .

Acting chief executive and cofounder Johan Svensson , soon to

According to CFO Måns Svalborn , the company also has be retake the reins on a permanent the “ discretion ” to settle part of basis , explained on the call with iGB Affiliate Monitor