Hi, and welcome to Redeye, and today's presentation of Gentoo Media's Q3 result, will be presented by the CEO, Jonas Warrer, and followed by Q&A moderated by me. And if you have any questions, please send them through on the website.

With that, I'll leave over to you, Jonas. Please go ahead.

Thank you very much, and good morning all. So welcome to the presentation today for our Q3 interim report.

We are Gentoo Media. I just wanted to say a little bit about that for those of you out there that are new to the business and to the industry.

So what we do is that we work as an affiliate in iGaming. And that means in layman's terms that we connect operators with players.

So what we say is when high-value players find the right brand at the right time, attention turns into action. And that's sort of the shape and the business that we shape.

Why does iGaming affiliation matter? I think most operators would say that affiliates, they can drive high-intent traffic.

We can also build trust to content and to the websites that we have. We can scale visibility fast.

I think you can see as an operator that you can both do traditional above-the-line marketing, but you can also work with all of the websites that you have online, which is all of the affiliate websites that actually also creates a lot of visibility and brand awareness. We can also, in that sense, boost conversion and retention for the operators, keeping a presence of the brand online.

And then we can reach niche audiences with the different type of websites that we have that target different niches and verticals in iGaming. I think if I dumb it a little bit down to explain more simplified, iGaming affiliation matters because we are the store that you find on the shopping street where players they go and look before they decide which operator to place a bet with.

Going into our Q3 2025 executive summary. Q3 is the first quarter showing clear results from the strategic realignment initiated earlier in the year.

If I have to highlight a few key words here, I would say, operational control and operational efficiency. This also means that we see EBITDA before special -- EBITDA before special items increasing quarter-over-quarter, reaching EUR 9.3 million in the quarter with margin improving to 41%.

Developments, as said, are driven by the rightsizing and organization simplification resulting in a stabilized and efficient cost base. Revenue came in below expectations, partly due to weak September sports margins.

We'll also touch on the next slide on a few other factors. Player deposit levels stayed -- developed positively year-over-year.

Our organizational capabilities have been strengthened across the organization through improved delivery discipline and clear accountability. And I would say we entered Q4 with a more efficient organization with strengthened execution, ready to maximize the year-end peak season performance and accelerate growth into 2026.

Post quarter performance is strong. October delivered 15% revenue growth compared to September and mid-November is trending even further ahead.

Gentoo Media maintains our full 2025 guidance, but with better cash conversion. Free cash flow from operations is adjusted up to EUR 31 million to EUR 34 million from previous guidance at EUR 27 million to EUR 30 million.

Okay. Going into the financial highlights.

As said, revenue of EUR 22.7 million, down from EUR 29.5 million in Q3 last year and lower than previous quarter that came in at EUR 25 million. Revenue below expectations due to usually -- unusually weak September sports margins and also still immature market conditions.

And we're still -- and then I will also say, with the partner and the portfolio optimization efforts that we have had in Q3, I think also that had a short-term effect on -- negative effect on revenue where we are more thinking about now the quality of revenue, and about the long-term sustainability of the revenue that we generate. Personnel expenses and other OpEx were EUR 7.4 million in Q3 compared to EUR 8.9 million in the previous year and also down 10% from Q2, from EUR 8.2 million in Q2 2025.

And I think actually also if we looked in at Q1 when we started this year because this is sort of the starting point that triggered our strategic realignment. I think it was up at nearly EUR 9.7 million there.

So we actually see that our cost base has been reduced and I would say is very much in control right now. And going back to the strategic realignment when we presented that, we presented certain targets, EUR 8 million to EUR 10 million in run rate savings.

And I think when we look now at Q3 results, I think it's safe for us to say that we are trending ahead of those targets. I think that's a very important message for me to make.

Marketing expenses at EUR 6 million in the quarter, and that's compared to EUR 8.4 million in the previous quarter. And what we did in Q2 was that we took a deliberate choice to increase a lot in marketing, to increase our player base and grow our player base.

And we didn't see the full -- we didn't see the revenue effect of that coming, right? And then in Q3, in line also with the strategic realignment, we have taken the choice here to reduce marketing by quite a lot.

But I think the highlight here to say is -- and we can touch upon that in some of the next slides that our player acquisition model is improving, meaning that we can generate players at a lower cost. And I think if we look, for instance, specifically paid, we have nearly halved our marketing investments, but we make 2/3 of the players if we do the same comparison, right?

So we are getting more efficient at what we do here. And of course, that is a very important metric for us and also gives us comfort for the future.

[Technical Difficulty] absence of major summer sports events, of course. But then what surprised us in this quarter was the very unusual low sports margins in September.

And of course, we still see secondary effects from what I would call still immature market conditions in Brazil. And also mentioned, there is also a third factor here.

This is simply the short-term effects from what we call our partner and website plus portfolio optimization initiatives, where we are thinking about the quality of revenue and about long-term earnings. Player intake and value of deposits.

Despite the seasonal impact of no major summer sports events in this quarter compared to last year, player intake and deposit values remained on par with the prior year. So player intake reached 109,000 FTDs in Q3 and deposit value reached EUR 195 million in Q3 2025.

And as you can see in the graph here to the right, this is very much on par with the prior year, and actually, for my part, very satisfied with that, considering that this was, as I said, a summer with no major sports events. Very important here to highlight, as I mentioned earlier, our player acquisition model was optimized in the quarter, meaning that we generate players at a lower average cost, and this is both compared to last year than it's compared to the previous quarter.

Operational highlights from publishing. I'm not going to go into the details for the revenue.

I think we touched upon that. Jumping straight into some of the more specifics here for publishing.

WSN.com, our North American-facing asset continue to drive with high revenue growth quarter-on-quarter and year-over-year. Key enhancements were made to the AskGamblers platform to improve site performance, monetization and user engagement.

We have done quite a lot to AskGamblers in Q3, but there's still also a lot of things to do looking ahead. Work on Gentoo Media's next-gen proprietary WordPress framework entered the final stages after more than 2 years of development with first websites to go live in Q4 and benefits to materialize in 2026.

This as it says, this is actually a project we have been working on for more than 2 years, delayed as it often happens with tech projects. But looking very much forward to seeing the benefits materializing now.

And I would say look very happy to see the developments we have done in Q3 and the strengthening that we broadly have done in our product tech and design team here also, which is some of the drivers for seeing the progress that we are seeing for this project. Paid revenue also same factors as we touched upon before.

So just going to jump straight into the details here also. Following the expansion in Q2 where we decided to invest quite a lot more in growing our player base.

The paid unit focused on controlled growth and operational efficiency in Q3. This is also what I'm talking about in the optimized player acquisition model.

So compared to Q2, paid retained roughly 2/3 of our acquisition volume with half the marketing costs. Of course, very happy to see that.

Growth initiatives launched in Q3 shows positive sign in Q4. And of course, also very happy to see that, that we have sort of managed to add another layer of new initiatives that are growing.

And with an improved and more diverse acquisition model, paid is poised to grow in Q4 and beyond. Post quarter, October delivered plus 15% revenue growth compared to September and with November trending even further ahead.

Q4 expected as a strong quarter, supported by a reduced cost base and restored EBITDA margins. Also, we've had the negotiation of the new terms on our RCF facility has been completed, which has created the room to explore the right financial structure for the business going forward.

In summary, Q3 was a difficult revenue quarter with a combination of factors affecting performance and causing results to land below expectations. However, the quarter also marked the first clear effects of the strategic realignment initiated in the first half of the year.

Decisive rightsizing actions have created a leaner, more agile organization with a healthier cost base and stronger ability to execute on growth opportunities. EBITDA margins have been restored with further upside as revenue develops.

Post quarter performance is strong. October delivered plus 15% revenue growth compared to September and with November trending even further ahead.

And as I said, Q4 is expected as a strong quarter, supported by reduced cost base and restored EBITDA margins. Gentoo Media overall maintains its full year 2025 guidance, but with better cash conversion, free cash flow from operations is adjusted up to EUR 31 million to EUR 34 million from previous guidance at EUR 27 million to EUR 30 million.

Thank you very much.

And now we move over to the Q&A session. We're also joined by CFO, Mads Albrechtsen to answer questions.

Maybe I can start with a question for you. I mean regarding your restated financials.

I guess you worked a lot with that. Could you elaborate, I mean I guess a lot of different changes?

Or if you can give some details on what has changed in 2024 and '25 as well?

I think first of all, it has been very, very important for us to be very transparent about it is what has been presented. Today, we issued a press release with all changes in separately for the sole purpose of actually addressing this theme.

As you're also seeing in that press release, there is a lot of different movements in each of the FSLIs. I think the overall theme here is that we want to present our numbers 100% correct.

When we did the audit last year, there was some unadjusted misstatements which we found immaterial. I think that's normal for a business like ours.

Then we also find other areas in '25 -- went through all the accounts. And then the Board, together with me, of course, took the decision to clean everything up to present everything as transparent and open as possible.

That's why we did -- as we did.

Got it. And I mean, looking at your process now on, how do you make sure that you don't have any big restatements again going forward?

Yes, I think that's an evident question. We have changed a lot, especially around finance and governance in general in the business.

Of course, I joined back in March, and we came out of a year of so much growth and transformation and also the years before that. I think it's natural for a business like ours to feel growing pains at some point in time that you need to take this important decision to invest a lot in the infrastructure and the controls and governance.

And I feel very much supported by Jonas, but also our Board to invest what's necessary for us to make sure that this has never happened again.

Sounds good. And moving over to the Q3 result there.

You mentioned three things that impacted negatively that you did not expect maybe when Q2 was released, sports margin, Brazil and partnerships ending. Can you say anything the biggest effect?

Or was it all three of them? Or if you can give us some information about that.

Now, of course, the sports margin in September was quite big, right. Also I think if you look at some of our peers, they also talked about this.

And then, of course, the sports margins or whether -- if we look at Brazil specifically, the sports margins were low in September, and we also still see this sort of still immature market conditions where revenue and -- revenue share margins can be very up and down in the different months. So it's still a little bit of a market that's difficult to predict.

So to what degree, what is what they are, but Brazil was, of course, also hit here in September, right, for both factors. And then -- and I think this is one that's maybe the most hard to quantify.

Of course, when we go into this process about looking out about our portfolio, what to invest in and also what partners to work with thinking about the quality of revenue. Of course, you end in some debates and you end up taking some actions that have a short-term effect and difficult for me to put a value on it.

But of course, there is an effect here. We are also in a process where we are discussing margins with our partners.

And we have a sustainable business together, a very good discussions with a lot of our partners. And of course, at that time, it can also maybe be difficult to have that kind of discussion and then you're also selling, for instance, fixed fees because there is a timing for everything, right.

And I think short term, there was an effect in Q3 from this portfolio and partner optimization initiatives that we are doing very dedicated now.

And you mentioned that Brazil continues to be challenging. Is it the market stable for you?

Is it continue to decline? Or what do you think we should expect from here from that market?

I think it's still a very attractive market, but it's also, I would call it, a chaotic market for us. It's hard to predict what will happen next month, which, of course, there's always various discussions down there to what should happen to the market.

So I would say we are optimistic about the market, but we, of course, also -- we are not letting the horses run free there. So we take, I would say, a controlled investment case down there right now.

And of course, continuously assessing should we increase, decrease, just do what we do now and whatnot. But we hope, of course, that the Brazilian market will turn out to be great, and it's a market we are optimistic about with some caution, as I said.

And just following up, on looking at your regional development, I mean you comment that Americas is, of course, soft due to Brazil, but then you actually saw some growth in Nordics. Was that something that you -- is it a trend or something that for this quarter that was there?

Or if you can elaborate a bit on that.

We have pretty good rankings in the Nordics right now for some of our sites and some of our markets. So very happy.

It's what we started out doing right many, many years ago. That's where we started.

I think I'm very happy to see that we can actually still grow that market despite some people would call it a legacy market, a market that's declining. That's not what we are seeing, and we can still gain market share by taking even more rankings there.

And I think we have done that in the last period. And very happy to see that.

If we can manage to grow in what you would call probably one of the most like mature markets, we should also be able to grow in some of the new emerging markets.

Good. And also a few questions coming in from the audience here around the guidance.

I mean if you look at what have you done this far, Q4 is implied to be a pretty strong quarter. And seasonally, I guess, it usually is, but can you give some -- I mean, you did say that October was 15% better than September.

But what do you expect in terms of the monthly development? Are you hoping a lot for a strong December to be able to reach that guidance?

If you can give some input on that?

Yes, of course, we are hoping very much for a strong December and have also expected that in the numbers we are seeing and in the guidance we have given. December is always the best month in the year.

We also expect it to be this year. But November is trending really good compared to October, and October is up, as I said, very strongly compared to September, right?

So optimistic here right now about numbers. And of course, December is normally a month where you have both strong earnings in casino and in sport.

So this is why it works very well for us, hopefully.

And can you comment anything about -- I mean, October 50% up versus September. I guess some of that is the reversal of the low sports win margin in September.

Is that a large part of the growth? Or is it different things in there?

No, I would more call it different things. Actually, we've been discussing a little bit whether we would see this effect from players having won so much money that they would just go even wilder.

I don't think really that's the effect we have seen here, I would call it more broadly growth across the line.

And a question for you, Mads, regarding free cash flow. I mean, you increased your free cash flow guidance here, strong operating cash flow, partly driven by some working capital changes.

Is that something you see you can sustain from here? Or is it something that can fluctuate going forward as well?

No, I think it's a fair level we are now. We are always focused on our cash flow, but I think that we have improved that side of the business a lot over the last couple of quarters.

We are always ambitious in terms of that. But I would say the levels we have now are suitable for our size.

So what we should keep in mind, obviously, of course, as Jonas is also saying the quality in our revenue. So the revenue actually turned out to be cash as well.

And we can actually utilize all the digital tools and automating processes we have implemented around a much better environment for issuing invoices and collecting cash. That's the sole purpose of why we see such a strong cash conversion in the business.

Yes. Yes, if I can say -- I think now with Q2 and Q3 completed with what we have seen now with the solid operational control and efficiency.

Of course, naturally, now we move focus towards growing the top line, towards growing revenue but added with this like quality of revenue. Because I think if you look at Q3 last year and look at how much more we generate in the revenue and then you compare the free cash flow from the operations, that's not that big of a difference, right?

So I think going forward, revenue growth but with this extra quality in it and then, of course, translating into growth in the free cash flow from operations.

And following up on that on the balance sheet, maybe for both of you. I mean, you said that you're evaluating the optimal structure of the balance sheet, I think maybe starting you, what does that mean?

I mean, do you look to refinance the bond or anything else that you could look forward to?

That's a very specific question. No, we are, of course, looking into what would be the best sort of financial structure for us going forward.

I don't think I'm in a position right now to say anything more detail about that. And of course, a debate that we are having with the Board and really looking forward to having now also after there has been created this sort of stability around our RCF situation, right?

If I can comment a little bit about that. I would say like there is two sides of it.

One thing is our liability side, of course. The short-term liability side is very much impacted of a quite big tax liability, which is not in reality, a liability, but in terms of how we had structured our setup, it's turned out that in our accounts.

We will clean that up to show more accurate picture around that. We have also added a narrative around that in our report, how you should actually look at that net liability.

The other element is, of course, it's evident that our bond is maturing by the end of the year. So of course, it's natural for us to look what we should do.

It's also -- we should also keep in mind that we inherit the financial structure for the old Gaming Innovation Group post -- and post the split, of course, we need to evaluate what is suitable for specifically our business and our strategic goals going forward.

And then just maybe a final one on the cash flow generation. I mean, you had a lot of acquisitions, deferred payments coming in.

Can you remind us, I mean, how much is left on that? And do you think more of the cash flow we will go to you, not from acquisitions.

We have a little bit above EUR 6.5 million left.

All right. Sounds good.

So that has been reduced by quite a lot this year also, yes.

Going out of this year, I think we have spent roughly EUR 40 million related to prior year acquisition, investments, et cetera. So of course, that put a certain burden cash flow wise on us.

And looking at the OpEx levels, I mean, you did a really good job by coming down after your cost optimization program. What do you see from here?

Do you think this is the new level where you stabilize from, and will we see more optimizations from here?

I would call it around this level right now. There's probably still a few things to do in the organization in terms of executing faster in a more predictable manner.

But cost-wise, I think we are where we are, should be right now. I think more I would put the focus towards revenue growth and growing top line.

Of course, I think what we have learned here in the last few quarters is that there is actually a lot of potential in the organization when you start to think about doing things better in a more structured and controlled manner. And of course, that is then a learning that we, of course, always need to also do that in the future.

And I think if we look back at '24 there was far more focus on revenue growth there, right? And we probably took some missteps there in that process in terms of letting the organization grow and the processes maybe not being the most efficient and so on.

So I think clear learnings from this year and something we should take into the future of Gentoo Media, of course.

Yes. And looking at what can drive growth.

I mean your products, recent Google update, you mentioned, I mean, some ups, some downs. It sounds like usual, but could you say some more about that?

AskGamblers has been kind of sideways declining? Do you see that stabilizing from here or...

Yes, I would say growth in broad sense, we can either optimize how we acquire traffic, how we convert traffic or how we monetize traffic. I think we are very good at acquiring traffic.

I think we can optimize how we convert the traffic and also I think we can optimize how we monetize the traffic also with this sort of quality revenue perspective on it. So things like conversion rate optimization, getting that more installed into the organization, having a stronger product portfolio that converts better with more user features that creates retention towards users.

We can definitely also, of course, we work with so many different partners. And that has been a metric for us in the past with diversification.

I think what we are saying now is that we, of course, looking at all of the different partners we work with and want to see that we work with partners that also invest in us, where we have a healthy sort of margin together. So that, of course, also means that there's work to be done here, and there's things to optimize here.

So I would say, traffic part, of course, we can always rank for more. And we are, of course, working very hard on that.

But I think if I look at our skill levels, what we can do better is probably more the conversion part than monetization part.

All right. And also a few questions here on the audience.

From AI search, you mentioned as well in your report that you are doing some to mitigate the impact from that. Can you both talk about, I mean, what impact you've seen from this far and also more about what you're doing to -- I mean, I guess, benefit from this in some sense?

Yes. I think impact is still discussing with and what they see.

There is some sort of impact, but I think it's hard for us to quantify still also notably within iGaming. We still have a lot of people that prefer coming to our sites to actually see what a human has sort of reviewed and chosen and recommended for them.

I think also that then talks into what are we doing about it. I think, of course, our website made by humans for humans, but also with strong product features, adding loyalty programs, being more sharper with offers, what we promote to the user, so it matches what the user is searching for.

I think there's still a lot of things to be done here. And I think if you look at iGaming and affiliation overall, you have been able to get away with having very simple sites that essentially are just top lists, and maybe the bar has been raised there.

And maybe that's also fair enough. It's also for the better of the user and then for the better of our customers, the operators.

So maybe it is a good thing right now that we are raising the bar, and we can definitely also raise the bar and we are doing that.

Another hot topic, I mean, if you look at the mostly -- maybe the U.S. market, the prediction markets.

Is that something that you are generating traffic to or revenue from? Or is it only a small...

Very small still. But, of course, the market we are interested in.

I think a market that's evolving quite fast right now. It feels like it's a bus that's driving, and we are trying to jump on it notably in publishing, of course.

If you decide to do something, it just takes a few months before we start to see an effect from it, right? Otherwise, it comes with too high risk.

So I wouldn't say that we see notably results there, but of course, something that we would like to see growing also.

And another on U.S., I mean sweepstakes has seen some regulatory changes, I guess you can say. Is that something that you see in your business as well?

I don't know how big sweepstake is for you, but...

It's a growing market for us, vertical. And of course, one of the drivers behind what we see in the U.S.

with WSN.com. That being said, of course, there is some risk here from a regulatory point of view, right, with the discussions that have been going on there.

So I would say use the opportunity that's there now, but we shouldn't go all in on sweepstakes. And I'm happy that it's still not a big part of our business in that sense because, of course, it would be nice to get clarity on what will happen in the U.S.

over the next years when it comes to sweepstakes, which is a bit of undecided right now. .

Got it. And a few more from the audience here on the cash generation.

I mean you're seeing higher cash generation, upgraded guidance. When do you think you can do share buybacks?

Or is that something you're looking at?

It's a valid question we're getting every time. And I think that the answer is still the same.

That, of course, that's Board decision ultimately. But right now, we need to fix the balance sheet we have.

We need to clean that up and make sure we are presented as smooth and operate as smooth as possible. If that require a little bit of more investments for us, we need to do that for secure -- for the good for the business in the long run.

Then of course, we need to fix the bond. We need to fix the elements before we are going out and doing that.

That will be natural. But of course, it's an element we are discussing all the time.

Got it. And also maybe you kind of answered this, but I'm just testing anyway.

I mean, looking at your guidance, I mean, you came in a bit soft in Q3. Wouldn't it be prudent to kind of lower your guidance a bit if you can give some flavor on why you not did that?

No, we see Q4 developing very positively. I think that's the short reply.

Got it. And also, I mean, a few general question here, if you can give some kind of trends.

I mean you've mentioned AI search and so on impacting prediction market [indiscernible]. But can you see some broad trends maybe globally in North America, Europe?

What's happening with affiliate marketing in the next few years? .

I think broad trends, we have seen -- I think I also talked about earlier, we have seen some smaller decline in margins here, right, when we work on revenue share earnings. And that's something we are very focused now on discussing with our partners.

I think we work with more than 300 partners where we are in more than EUR 10,000. So we have a lot of partners to work with.

And diversification has been a big theme for us. But I think going forward, we also, of course, want to work with the partners, where we continue to see that we have the margins that we have been used to and where we have a fair partnership.

And I think I would assume that's also a trend for the other affiliates out there. We see -- at least we see broadly across our different partners and are now discussing with some of them, what does this mean, what does it mean for the future.

There are a lot of partners to work with. Some of them are doing amazing in some markets, and some of them are doing less amazing in some markets.

And I think going forward, this sort of the partner optimization aspect becomes more and more important.

Okay. Perfect.

Thank you very much for joining.

Thank you very much.