Codere Online Luxembourg, S.A.

Ladies and gentlemen, thank you for standing by. My name is Brent and I will be your conference operator today. At this time, I would like to welcome everyone to the Coderre Online fourth quarter and full year 2021 financial results conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question at that time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, again, press star one. Thank you. It is now my pleasure to turn today's call over to Mr. Guillermo Lancha, Director of Investor Relations. Please go ahead, sir.

Guillermo Lancha, Director of Investor Relations. Thanks, Operator, and welcome everyone to Coderre Online's earnings call for the fourth quarter and full year 2021. On this call, you will hear from our CEO, Moshe Edre, and CFO, Oscar Iglesias. Before turning the call over to Oscar, I'd like to remind everyone that during this call, we will be referring to a presentation we uploaded to our website earlier today. We encourage everyone to read the disclaimer section, particularly the points around forward-looking statements, non-IFRS financial measures, and preliminary information. During today's call, we will be referring to non-GAAP financial metrics such as net gaming revenue or adjusted for which you can find reconciliations in the appendix of the presentation. Finally, please note that a replay and transcript of this call will be available later today on our website at codereonline.com. And that if you haven't already signed up for our investor email alert, we would encourage you to do so. Oscar, over to you.

Great. Thanks, Guillermo. And good afternoon to everyone joining the call. This is our first earnings release since becoming a publicly-traded company following our merger with a NASDAQ-listed SPAC on November 30th. As such, while many of you may already be familiar with the Code of the Online story, we are mindful that for others, this may be your first time hearing it. So, we have tried to find a balance in the information that we have shared and will be sharing with you in an attempt to make this call useful to all participants. We are coming to the market later than we would have liked to report fourth quarter and full year 2021 results, especially considering that we have the first full quarter of 22 nearly behind us, but wanted to ensure that we had good visibility over our audited annual figures for 2021 before doing so. This information will be reflected in our first annual report, which we expect to file on form 20F with the SEC in April. Going forward, we are targeting to provide investors and analysts updates within 45 to 60 days following the end of each quarter. Later in this call, we will be sharing some preliminary comments regarding first quarter operating activity, which we will be reporting to the market and discussing with you in the second half of May. Finally, I wanted to cover a few more housekeeping items before turning the call over to Moshe. Just a reminder that Correa Online is Luxembourg-based, and as a European-based company, our accounting information is prepared in accordance with IFRS accounting standards, and our functional currency is the Euro. As such, throughout this presentation and in our discussion, all monetary figures, including any guidance provided, will be in Euro unless expressed otherwise. With that, I will go ahead and pass the call on to Moshe.

Thank you, Oskar, and thanks everyone for joining the call. I have spoken with many of you already, but for those who are new, I joined Coderre Online in late 2018, and together with my core operating team, we've been managing the online business for three years. Over much of this time, the business has been impacted by the COVID global pandemic, which has created both significant challenges and opportunities for Coderre Online. As you may know, prior to the business combination, Coderre Online was a wholly owned subsidiary of Coderre Group, which is based in the great Spain and has over like 30 years of retail gaming operating experience in Spain, Italy, and throughout Latin America. As with most of the retail gaming operators, Coderre Group was significantly impacted by the closure of its retail location due to the COVID. As a consequence, Coderre Group had limited capacity to support the substantial opportunity we had to grow our online business. This ultimately led to the business combination transaction and NASDAQ listed that we completed late last year, which provided over $100 million in new funding to grow this business. And while Kodera Group continued to be the majority owner of the business with approximately two-thirds of the company, This transaction has also allowed us for more comprehensive separation from Coderre Group, from illegal financial reporting, and corporate governance standpoint. That said, the strategic vision that Coderre Group and Coderre Online have for this business is the same, to leverage over 3 million customers in Coderre Group's retail databases. hundreds of significant omni-channel opportunities we see across our core market, and to establish Coderre Online as one of the leading online sports betting and casino operators in Spain and throughout Latin America. We are already seeing the significant competitive advantage of deploying an omni-channel strategy in Mexico, where our cross-selling approach, retail payment processing, and overall improved customer experience are resulting in improved operating performance of our business, and as a result, significant growth in customer acquisition, improved retention, and net gaining revenue in our Mexican business. Before turning back over to Oscar to elaborate on our financial performance in the business, I wanted to touch on a few of the highlights of 2021. We are not only impacted by our limited financial resources, but also two other factors. was a major platform migration that we realized in Mexico, in which negatively, though temporarily, impacted the operating and financial results in the second and third quarter of last year. The second was the new regulatory restriction that came into place and will continue to be our largest market by revenue. This restriction, which came into effect in May 2021, imposed significant limitation on advertising, sponsorships, and promotional activities. This restriction has a greater impact on our business than we were expecting, which affected our financial and operating metrics, in particular in the second and third quarter. But overall, we've adapted to this new operating environment and resulting in the fourth quarter of 2021 and first quarter of 2022 have already started to recover. Despite this headwind, we were able to deliver a 17% growth in net gaming revenue, a substantial increase in customer acquisition, and overall growth in our customer base, Though COVID had the regulatory restriction in stand next comparison with 2020 difficulties, well, with that, I will turn it over to Oscar. Oscar?

Thanks, Moshe. Turning to the results for the full year, we see that 17% growth in consolidated net gaming revenue was driven primarily by a solid 38% growth in Mexico. partially offset by a more muted growth in Spain due to the impact from the regulatory restrictions that Moshe mentioned. From a mixed standpoint, Mexico contributed about one-third to consolidated net gaming revenue in the full period and an even higher share in the fourth quarter, a trend that we expect will continue into 2022. In regards to EBITDA performance, Please note that EBITDA figures shown are adjusted to exclude the impact from transaction expenses heard in the business combination, and a non-cash impact from the application of IFRS 2, which relates to public listings by way of a reverse merger with a non-operating entity. Adjusted EBITDA on the period decreased to negative 24 million, primarily due to the increased level of marketing investment in 2021, especially versus COVID impacted depressed levels in 2020, and to a lesser extent, higher platform technology and personnel expenses incurred in the period. But we believe that this higher level of marketing and operational investment has put the company in a solid position to deliver the significant growth we are targeting over the coming years. As a reminder, the upfront investment we make to acquire customers in any given period, what we typically refer to as a cohort, generally recovered and generates a return over the lifetime of those customers. Internally, we define lifetime as five years following acquisition. We'll be seeking a relationship between lifetime value to acquisition cost of about three to five times, depending, of course, on where we are in our growth trajectory in any given market and the applicable unit economics of that market. Turning to country-level operating and financial metrics, in Spain, we see the impact of higher regulation reflected in the 13% year-on-year decline in net gaming revenue in the fourth quarter of 2021, but encouragingly, an 8% sequential increase in the fourth quarter on the back of a significant uptick in the number of actives, which we believe, again, demonstrates that we have adapted well to this new and in this new operating environment. In Mexico, net gaming revenue is up double digits on both a sequential and year-on-year basis. Q4 in particular was a difficult comp with strong operating performance in the fourth quarter of 2020. But overall, the business is trending well, and our outlook for this market is very positive. As I mentioned before, our omnichannel approach to this market is driving part of this growth, given the large retail presence that a group has in the country with nearly 90 gaming halls, which facilitates cross-selling between retail and online. This is further supported by the fact that in Mexico, 100% of the retail activity is tracked as required by regulation, allowing for much more effective promotions and overall customer management. In Colombia, meanwhile, We have had strong growth in the year in terms of both net gaming revenue and actives, but to continue to feel that we have more wood to chop to drive growth and improved returns on marketing investment through our omni-channel strategy. Turning to the balance sheet at year-end 2021, I wanted to highlight a few things. First, to let you know that we had over $100 million available for deployment in furtherance of our growth plan for 2022 and beyond. We are also providing our networking capital position at year end and expect to continue providing this on a go-forward basis to help investors and analysts understand future cash flow impacts from variations in working capital. For those of you who may be modeling this, we expect that our net negative working capital position will continue to be in the range of 15% to 20% on net gaming revenue. That's all from my end. Moshe will be walking us through the few remaining slides.

Moshe Rabinowitz Thank you, Oscar. To close out our formal remarks, what I would like to do is to step back to remind everyone of the substantial market opportunity that we are seeing throughout Latin America and then outline what our strategic priorities are over the coming years and what that means in terms of expected growth for our business. As we discussed in the roadshow for the business combination, the overall expected total addressable market for the online gaming in Latin America is much smaller than that anticipated for the U.S. market, but the growth opportunity is very similar, and perhaps more importantly, the Latin American market is much less crowded from competitive standpoints. And while we expect new competitors will continue to enter the market, we feel very comfortable that we are well positioned to compete and grow our business as planned. One of the major contributors of this expected market growth is, of course, Brazil, which we leave alone represents about one-third of overall time potential of Latin America by 2027. As you may know, federal legislation has been approved in the lower house, but a number of legislative and political hurdles will need to be cleared for this promise to become reality. In any event, we are closely monitoring the situation and working internally with our board to ensure that if and when online gaming is legislated, we will be ready. For those who have been following the company, the strategic priorities we have established will come as no surprise. Our first and primary focus will be to execute our core market growth plan And as Oscar mentioned earlier, we'll be back here in May to discuss how we started the year, but we can tell you now that the business is performing well and according to the plan. Secondly, we'll be working tirelessly to ensure that the return on marketing investments are not only being met, but also improving over time. Revenue growth alone is not sufficient, and we're delivering value means that revenue growth translates into positive dividend and cash flow in the years ahead. And now that we have all the bells and whistles in place to operate as a public company, we'll begin turning the attention increasingly to expansion market opportunities, strategic partnership, and other inorganic growth opportunity. Not in the expense for our core market growth plan, but as a complement and a continuance of creating value to the shareholders. Fourth, and related to the point about creating value, please know that with our long-term incentive plan now in place, The management team and directors are fully aligned with the shareholders in this regard. Finally, we'll continue to focus responsible gaming in order to mitigate any gaming problems. In terms of net gaming revenues outlook for 2022, which is based on our core market only plan, we're expecting net gaming revenues of between 110 and 120 million euros. Our goals are about 38% over 2021. In addition to the guidance for 2022, we're also providing net gaining revenue outlook of both 23 and 24. The year in which we believe will be EBITDA and cash flow positive. In short, we achieved what we set to achieve with the business combination, but more importantly, we continue to believe that the market opportunity is compelling and convince our ability to execute an operating plan and meet financial objectives we have set. With that said, We will turn it back to the operator and to open the call for Q&A. Thank you.

At this time, I would like to remind everyone, in order to ask a question, press star followed by the number one on your telephone keypad. Your first question comes from the line of Jeff Stanchial with Stiefel. Your line is open.

Hi. Good morning, Moshe. Oscar, it's great to be speaking with you both again. Just a couple from me here. You know, first off, you know, a couple months since you started executing on your operating plan, just curious, anything that surprised you with respect to the returns on your marketing spend across the various markets, or are there any material deviations from how you underwrote customer acquisition trends by market?

You want to take that one? As much as I can. Yeah, as much as I can disclose at the moment, because we're getting into 2022 results in a way. In general, generally speaking, our assumptions are not much away from or far from what we expected. But we did some adjustments in a way that we optimize all the time our performance. There are some markets, which I don't like to disclose right now, that are performing much better than we anticipated, and therefore we allocate more resources to those markets. We accelerate some of the markets. While in some markets we see some, I would say, product and technical challenges that will reduce a bit the marketing and will rapidly improve the technology, and then we'll go back and accelerate those markets. But all in all, I think that we are in the frame of the metrics that we presented in the roadshow.

Perfect. That's helpful. Thank you, Moshe. And then my model has you guys just narrowly hitting break-even around 2024 with net proceeds on the balance sheet. Any thoughts on whether you might look to raise a little more capital, just have a bit of a buffer and air conservative, or do you kind of have more of a wait-and-see mode to see what the returns on market expense continue to trend like in year one of your plan?

Yeah. Hi, Jeff. I think that it's more of a wait-and-see mode. We're three months into the first calendar year after the capital raise, and we'll see how the business tracks over the course of this year and see what other opportunities arise that might lead us to consider raising additional capital. But I think for the time being, we have the cash that we sought to raise that we need to execute the core market business plan that we we set out to execute. So I think it's more of the wait and see at the moment.

Okay, perfect. That's helpful. Thanks, Oscar. And then on the guide, it looks like your expectations for growth in 2022 are a bit different versus how you framed it in the initial back, back in, I think it was October. Can you just walk through what's changed in some of the underlying assumptions and has anything changed to, to 23 and years further out or really just 2022?

Yeah, I can take that one. The 110 to 120 in euro terms, the high end of that range, the 120 at current expected average exchange rates translates to something like 132, 133 in dollar terms. So in the investor presentation that we came to market with last year, I believe the outlook we had for full year 2022 was 152. So there is a gap of 20 million USD there, and then framing it in USD terms, because that's the outlook we had for the year in the transaction presentation. About half of that is exchange rates. So as you know, in mid last year, when we came to market and had that 152, and obviously we We underwrite and model the business in our functional currency in euros, but the euro dollar was more like 119, so $119 to the euro, and the average exchange rate expectation for this year is more like 111. So about half of that, let's say those 20 million, about 10 million USD is due to FX. Of the remainder, which would be the expected performance of the underlying business, I think some of that, I think probably the majority of that, 6%, 7%, uh is is spain given that the impact of the regulatory uh limitations restrictions uh aren't temporary and we're adapting in that environment but versus where we were and our expectations mid-year last year uh it's a more challenging environment than we had expected so some of that carries over into 2022. the balance of the markets are are more or less uh in line uh some slightly higher some slightly lower but but i think the majority of the operating the reduction due to the operating expectations is due to Spain.

Okay, perfect. That's extremely helpful. I'd squeeze in one more if possible. You know, you had a comment there towards the end on potentially looking at opportunities for inorganic growth, you know, to the extent, you know, you've done some work there. Could you just frame that a bit more, you know, are priorities kind of Looking at maybe brands that resonate in certain markets, where do you think you could come in and improve with technology and best practices in marketing? Is it, you know, additions to the tech stack? You know, what are you seeing out there that could potentially add value from an inorganic perspective?

Okay, do you want to take that or do you want me to? Yeah, so, yeah, I would take it. Thank you. I would take it. So, yeah, Jeff, generally speaking, we are always looking for, obviously, for good opportunities. And I think that from the management perspective, at least from us, knowing the market quite well and that we stay quite comfortable in the landscape of our competitors, small, medium, side, we're getting quite an essential amount of scanning and offering from different angles. First and foremost, obviously, some marketing companies that we can mitigate and we can have some sort of synergy and to see if we can implement into our core operation. But obviously, when we are talking and mentioned that here on Brazil or any other future market, we believe that one of the right ways to enter those markets is by some sort of cooperation, some sort of I would say partnership maybe with a few big brands, something that we can shortcut our access to the market. And aside from that, markets like Spain, obviously, which we have quite severe restrictions in marketing and advertising. We always with eyes open to see any small, medium competitors that are struggling and withdrawing from the market, which has started already, to see if there's any opportunity there that we can either buy or to do some sort of ad hoc deal.

Perfect. That's extremely helpful. That's all from me, guys. I'll pass it on. Thanks for all the color. Thanks, Jeff.

Your next question comes from the line of Michael Kopinski with Noble Capital Markets. Your line is open.

Thank you, and congratulations on your first quarterly call. A couple of questions. I know that you recently commenced operations in Buenos Aires, and I was just wondering, how did that go, and are there anything that you've learned from opening up and commencing operations? I believe you opened those up in December. Anything you've learned there? How are things going in that market in general?

So, yeah. Obviously, as you probably know, Argentina is quite a big business for Coderre's retail. More than a third of Coderre's mother company is generated from Argentina, although it's in the province of Buenos Aires and not the city of Buenos Aires. So we felt quite comfortable, and it's something that we presented in the roadshow, that we feel quite comfortable with Argentina entering into the market and entering into the city of Buenos Aires. And that's exactly how we feel now after operating for three months. Obviously, it's a very initial stage, so there's still some integration process With the regulator, the regulation is quite complicated in the city of Buenos Aires, and integration with different kinds of processing providers and so on. So we are in the process still of a soft launching, I would say. But as far as we started and with the initial stages, we are very happy with the result that we see of the player value and our ability to scale up.

Terrific. And has the roadmap in terms of commencing operations in Latin America, has that roadmap changed in any material way from the investor presentation before?

No, not really. Not really. I mean, we have six core markets that we're operating. We also only said that our focus would be on Latin America. rather than on Spain and Mexico. We always say that Spain is our biggest market and with a cash positive EBITDA. And we're maintaining our market share and that's the effort that we are putting in Spain. But the growth and the focus will be on Latin America, and this is the case. That's why we're focusing on that. And again, up until now, three months, four months after the fundraising, we found out that We're on plan, and we're performing as well as we thought, and we're having the same COCs and KPIs that we anticipated.

And in terms of the regulatory environment, have we seen more movement on that front in particular countries, particularly like Brazil and so forth? How is the regulatory environment? Is that really along according to your plans at this point?

So, again, going back to the presentation, I mean, we're definitely following closely about the legislation in Brazil. Brazil, by far, is the biggest market in Latin America. There are some big companies that are currently operating without a license. I'm not saying that it's illegal, but they're operating without a license, something that we're not willing to do. Um, so there are some process, there are some progress, but, um, unfortunately um this is the this is the case in brazil for the past seven years i mean there are some sort of uh minor development in legislation but nothing concreted there's nothing there's no date that we can pin and say okay we can be ready but we prepare whatever we can i mean in the background in the back office i mean with our legal team with our operational team with the people on ground to see that if that will happen that will be ready to enter Other than that, there wasn't any, I would say, substantial development in any other of the countries. We looked at some legislation that might apply in Chile and Peru, but there's nothing that we can, at the moment, that we can share. Nothing changed.

Okay. All right, perfect. That's all I have. Thank you.

Your next question is from the line of Art Rulak with Three Court. Your line is open.

Hey, guys, I have a couple questions. Thanks for hosting the call. First is just like operating expenses from 2020 to 2021. Can you just sort of, 2020 I think was around 77. It's around 107 and 21. Can you just sort of bridge the delta between those two numbers? Yeah. Hi, Art. Thanks for the question.

Yeah, I can take it. Starting with the marketing expense, I think it's what's always a challenge and understanding that the revenue is growing 17 and some of the operating expense lines are growing at higher growth rates. But the comp versus 2020 is significantly impacted by the onset of COVID. And as everyone that follows the online gaming space knows that it was an environment that did in those early months in late March, April, May into June and even beyond that the business had an uplift in terms of revenue, in terms of spend per customer as the retail locations, the retail gaming options weren't an option for gaming customers. So I think that obviously impacted and benefited to some extent the top line on the marketing expense. We obviously ratcheted down our marketing investment throughout those months. in 2020. So I think the 37 million that you're seeing in Euro terms in 2020 is probably a lower base, and what we have in 21 is a more normalized level of investment, especially later in the year as we started working through the transaction, the business combination that ultimately got completed in November. On the platform and content front, there's a number of things that are in there beyond just platform and casino content that there's also You know, sports streaming, data feeds, all types of other things that are critical to the offering and the platform that our customers utilize. I would say on the streaming side, we did make a big push last year to start offering more streaming content on the sports side to improve and enhance the customer experience there. for our players. So that's responsible for some of the uptick, but there's a number of different things in there. And then on the personnel front, I think also in anticipation of the transaction, the listing, obviously there were some key areas that we needed to reinforce both on the operating as well as let's say, the structural or overhead aspects of the business. So it's a difficult year to compare, but clearly 2020 being COVID-affected makes for a difficult call.

Got it. Thank you. And Greenplay, I wasn't familiar with. I guess you divested that. Was that a very small asset sale, I guess, or was it sort of taken off the books at cost or something?

Yeah, it was a very small transaction. It was one where a decision by the company to exit what we felt was a non-core business for us. And it was a deal we completed at the end of 2021, but didn't generate, I think, what would have generated at most a couple million of net gaming revenue for us in 2020. I think less, more like a million in 2021. So very small business, non-core, not our focus. So it was one that we were able to achieve a positive sale price as opposed to the alternatives which we had, which effectively would have been an early termination of an agreement that would have created a break free for us. So it was a positive outcome for us.

Got it. In the working capital, can you just sort of, you talked a little bit on the slide, but can you sort of fill in what that working capital number means and sort of how we should think about it as the company grows? Like, is that just receivables and payables, or is there something else in there that has to do with regulation, or what is it?

Yeah, I think there's a couple of things here that we've tried to provide in a very transparent way what our mapping is for For net working capital, I think that the most significant line item on the liability side is our accounts payable. I think it's pretty typical for gaming companies, both retail and online, that they carry a net negative working capital position on their balance sheet, given that the customers play in cash and we earn. We don't have receivables from our customers. We don't extend credit to our customers. So I think the point here was that the working capital position is normalized. This is something we expect to continue going forward. At December 31st, it was negative $16 million. This is about 19% of our revenue for the year, and it's a relationship that we would expect to hold on a go-forward basis, all else being equal. But it's mostly accounts payable, and we provide a breakdown here of how much of that is a true third party. That could be, you know, media companies, technology providers, content providers, any number of different things, and how much is it, given the relationship and some of the questions we've had in the past about the relationship with Closeted Group, Now, that obviously has been formalized under a number of different what we call related party agreements. We wanted to give additional detail about where we were at year end in terms of accounts payable to our parent company.

Got it. Thank you. I have just one or two more. Thank you for indulging a couple questions. This is my first time chatting with you. My next one is I've been reading in some of these publications that Cordere parent was perhaps going through a sale process or investigating NASA sales or physical casinos in Argentina. Obviously, you just launched in Buenos Aires. Is that a point in fact that there's a sale process? And if so, if it was consummated, how might that impact the online business there?

Yeah, I can take that one. I think I remember the article that you're referring to back, I guess it would have been a couple, a month or two ago. I think that as far as I know, there's no truth to anything that was written in that article. I don't understand that. Obviously, I'm CFO of the online business. We're a two-thirds owned subsidiary, listed subsidiary of Govetic Group, but I understand that there's no no plans in the works to divest any business, including Argentina. But you're more than welcome to join the Coletti Group earnings call that's happening at 5.30 Central European time if you want to pose that question to the Coletti Group management.

Is that call today?

It is. It's at, I guess, 5.30 Central European time. Now we're from November.

11.30, right. And my final question is, any thoughts about just the liquidity of the stock has been pretty anemic most days. Any sort of plan or strategies to maybe try to get a little bit more velocity of trading going on it?

Yeah, it's a good question and one that I think we've been building quite a bit from investors and analysts alike. And I think, look, we're only a few months out from the business combination. We're focused on, you know, executing the business plan that we set out to execute. We've had a couple of, you know, board meetings, I think three in total since we completed. So we have clear what our, you know, three-year plan is, our budget for this year. and our operating teams are back to operating the business as opposed to helping us manage the deal process. So we understand it's an issue. It's one that we have on our radar. It's not one that we can fix easily or quickly, but it's one that we definitely have in mind. Obviously, we would like for there to be, any company would like, any listed company would like for there to be more liquidity in the shares and and to help facilitate the entry of new investors that may have an interest, but given the liquidity profile, don't have a way of really executing or stepping into an investment in the company. So we have it on our radar, but don't have any near-term effects for that.

All right, guys. Thank you very much. I'll let someone else ask some questions. Thank you.

Thanks, Mark. Nice talking to you. Again, if you would like to ask a question, press star followed by the number one on your telephone keypad.

Okay, in the meantime, we have a couple questions coming in from the webcast. So the first one is, is management buying stock personally at these prices?

Well, maybe I can jump in very quickly on that one, Guillermo, and obviously I can't speak for the rest of the management team directors or other insiders, but we are in a closed period, and we have been since the end of, 2021 and the internal policies that we have on insiders, you know, buying or selling shares of the company established that you can't once the quarter is closed, it has to be the trading window opens two days after the quarter's end and then closes again when the quarter is over. So the first trading window that we'll have uh would theoretically be after we report uh q1 results in mid-may in mid to late may back half of may uh so two days after we release would be the first window and that window would be open until the end of june i'm not sure if that answers the question obviously the the shares are trading at uh you know a little over five dollars per share uh my personal view is that that there seems to be a lot of relative value there when you look at uh even though the the sector more broadly as traded off. This seems like from a relative value standpoint, it would be attractive, but I can't speak to what other insiders may do vis-a-vis buying shares or not. Moshe, anything to add on that one? No, no.

I think that's absolutely right. Want to go to the next one, Guillermo? Sure. So this one might be a bit more for Moshe. So can you elaborate on the negative impact of the advertising restrictions in Spain? It was well flagged on an initial assessment that it was a neutral to net positive because it would put a cap on marketing spend and also favor the large, well-established players like Codere. So can you elaborate a bit on that?

Can you just repeat the last sentence, Guillermo? I couldn't hear you.

Yeah, so he's asking if... Yeah, so we initially mentioned that it was a neutral to net positive because it would put a cap on marketing and spend and also favor the large, well-established players.

I'm not sure what they mean by putting a cap, but, yeah, obviously, I mean, in Spain, we have quite... limited um unlimited channels that we can spend on marketing due to the advertising ban um being more specifically it's mainly between post midnight and five o'clock in the morning and that's where we can advertise and we already maximize and optimize this uh slot of um of exposure for the brand but um again going back to the roadshow that we had and um emphasizing that um Spain is a big market for Coderre, not just for the online, but also for the retail. And since we have dozens of retail presence stores and some sort of omni-channel strategy and the brand awareness of Coderre as the retail partnership with the online, We believe that not just we can keep our market share, but over time, because of the mitigation from small and medium brands that we grow from the market, and also from the organic growth of the market by itself, we'll be able to maintain, sustain, and to grow our market share. The good thing about Spain is that we see that we have already a full recovery from the downfall of the legislation period that was beginning mid last year. And we see that both in terms of revenues, but also in terms of those players that keep playing and recruiting new players that are coming from our own channels, the brand and the organic channels. We see that the quality of the players are much higher than those that we've seen before. And that somehow... uh offset uh the um i would say the weakness of the ability to recruit as much as players recruited before the legislation i know that's answering the question but i think that this is the approach about spain thanks moshe do you have any others from uh i think i'm getting a new one operator any other questions from people connected

Again, if you would like to ask a question, press star followed by the number one on your telephone keypad. There are no audio questions at this time.

Okay, I think we have a final one that just came through the webcast. Again, in line with what was asked before, if the shares continue to trade at interesting prices, will there be any possibilities of considering buybacks given the strong cash position even though the company is in a cash burning stage?

I mean, it's a good question. I think the answer is it's not something we're considering. The $100 million that we raised, we have earmarked toward execution of our three-year plan, executing the growth that we have contemplated out to 24%. the year in which we expect to be on cash flow positive. And we see lots of opportunities in the markets where we operate. But I think it's a fair question. I think it's one that, you know, we presumably will be discussing going forward. But right now, there's no plans to initiate any share buyback. Okay. I think that's it from the web.

Operator, unless there are any additional questions, I think we can... There are no audio questions at this time. Okay, so thanks everyone for attending this call. If you have any follow-up questions, feel free to reach me. You have the website, ir.coderionline.com email address. And we look forward to speaking with you again in the back half of May for our Q1 2022 results. Thank you, everyone.