Good morning. This is the Catena Media interim report for January through September 2021. I'm Michael Daly, Catena Media's CEO, and I'm joined today by Peter Messner, our Group CFO. Today, we are talking you through the Q3 highlights, our recent acquisition of i15 Media. We'll then go deeper into the financials for Q3. We'll talk about our continuing strategy and outlook, and then we'll cover Q and A. We had an exceedingly strong quarter, both on revenue growth and EBITDA growth. Revenue growth was 33% year-over-year, North America and Japan being the main drivers. This was a lot of organic growth at 23%. Excluding the German sports betting casino market, which we all recognize has been challenged, organic revenue growth was 34%.
It should also be noted that the German market is now 4% of our total revenues, and so it's become a very small factor in our total growth going forward. We do hope the German market to improve, but for us, the impact has become almost negligible. North America, however, has become very important. North America revenues grew by 124% in the quarter, accounting for 51% of group revenues. This was growth in both casino as well as sports. The opening in Arizona boosted that revenue in September significantly. We should also talk, being global, that our revenues in Japan doubled and accounted for 9% of our revenues. We did see the normal seasonal dip in European sport, but that globally was offset by things like Japan and North America. Our new depositing customers increased significantly, as did our EBITDA.
Our EBITDA increased from EUR 12 to EUR 16 in the comparable period, and that's a 33% growth, similar to the revenue growth, at a margin of 48%, despite further heavy investments in North America and the transformation program we've previously spoken about in Europe. We plan to continue heavy investment in North America as well as the rest of the organization to prepare for 2022 and beyond. Lineups, which we acquired in the last quarter, and i15 Media, which we acquired during this quarter, added significant value starting from September 9 when we closed the i15 Media deal and when the NFL season kicked off in North America. Profit was negatively impacted by a EUR 49.4 million non-cash impairment on intangible assets related to Germany, from assets we acquired a number of years ago, and France, French sports assets.
These were based on market condition changes, such as the ones mentioned about Germany, where we saw it as necessary to take these impairments and set the stage towards what the new markets will look like in those areas. Our solid financial footing does provide a strong foundation for further growth and flexibility and use of capital. From 13th September to 15th October, we repurchased 2% of the outstanding B-shares. Speaking of the acquisitions, i15 Media was acquired during the quarter, again, just prior to the start of the NFL season. We acquired it for $45 million, with $12.5 million paid in newly issued shares. This is a boost for the upcoming markets and states in North America.
Lineups, which we acquired previously, was a new national sports site for us to add to our already strong national sports site, The Lines, to work in parallel. i15 Media consisted of a number of sites which were state-focused sites across current strong states like Michigan, but also for significant boost to Arizona and upcoming states like New York, et cetera, which we'll talk about further in the presentation. i15 Media's assets and Lineups assets together help maximize the revenue for the NFL opening this year and will continue through Q4 and the next number of NFL seasons to come in North America, as well as additional sports which we continually will be adding to these products. We expect significant value from these going forward. The current outlook for October.
October revenue growth was 21%, or 36% if you exclude the German sports betting and casino markets, compared to the same month last year. Revenue from North America over 2020 October was up 125%. I should note that income from revenue share deals were negatively impacted by unusually low sports betting margins across much of Europe. This has also been reported by some operators recently in their reports. We're also seeing some indications of a changed seasonal trend from last year in North America in the sports season. We started with a very strong September, with an exceptional high in part to the Arizona launch. Compared to last year's trend of where October landed compared to September, this year is looking slightly different. Last year we did have Tennessee launch in North America.
This year we don't have a state. We had Connecticut launch in this month, but Connecticut being a much less significant player. We are seeing some impacts from things that might be viewed as a reverse COVID effect. We are seeing some trends and incentives similar to what operators reported that has made Q4 maybe not the stratospheric quarter it might be, but it's still going to be very strong based on that North America 125% year-over-year growth. You know, there could be reverse COVID effects we've been theorizing in terms of people going out and about in the world more. Winter is coming across the world. The online opportunity grows as the convenience of online trumps the experience of the in-person during the winter months.
We do have strong expectations for Q4, tempered slightly by the trends we've seen in Europe and North America, but this sets us up very well for 2022 and beyond, which is what we will continue to invest towards during this quarter. I will now turn it over to Peter Messner to talk about these financials more in depth.
Thank you very much, Michael, and a very warm welcome to our third quarter earnings call from my end as well. Continued revenue growth. As Michael mentioned, total revenue was at EUR 33.1 million, grew 33% compared to last year. As mentioned before, organic growth was likewise at 23% or when excluding Germany, 34%, and only accounts for 4% of group revenue. 96% of total group revenue is search revenue, and that grew by 41% as compared to last year. Paid revenue decreased by 30% or roughly EUR 600,000, and paid revenue only accounts for 4% of total group revenue. It is a lower margin revenue source that the company has exchanged with an increased focus on organic revenue growth in previous quarters already as well.
Total NDCs, our new depositing customers, core KPI increased by 62% year-over-year, and that is also mainly driven by the sports segment and of course, the COVID impact during the last year. Taking a look at the share of revenue by segment and by source, we see that the share of sports increased significantly from when it was 28% in Q2 this year to 38% now in the third quarter. That is the result of the seasonality in sports, of course, in particular the start of the NFL season in North America in early September, and additionally boosted by the two acquisitions, the lineups.com and the i15 Media assets, and also the launches now in the autumn in Arizona and the smaller state of Wyoming. The financial trading segment represented 2% of total revenue.
As compared to last year, that share decreased due to the divestment of the Hammerstone news subscription service during the final quarter of 2020. This also meant that there was no more subscription revenue during the quarter. From a sourcing perspective, revenue from CPA, that is cost per acquisition, increased to 53% of total group revenue, which is expected due to the aforementioned reasons of the seasonality and the NFL start, market openings and acquisitions in North America, and that's mainly driven by the North American CPA-based model. Versus last year's 38%, and apart from the launches in Arizona and Wyoming now in Q3, also the states of Tennessee, Michigan and Virginia have been opening up in the past 12 months, so that added to that CPA trend as well. Going into the segments then.
Casino is and has historically always been the largest segment of Catena Media and represented 60% of total group revenue and 71% of total group's adjusted EBITDA during this quarter. North America has seen a very strong performance in both Michigan, but also the social casino area there contributed to that growth, which was 24% year-on-year. Revenue in Japan, as Michael mentioned earlier, which is a casino-only market for us now, doubled versus last year and achieved an all-time high during this quarter as well. The NDCs increased by 58%, and that includes social casino as mentioned, where the new depositing customers naturally have a lower value as in the usual, normal casino segment. Turning over to sports.
Sports represented 38% of total group revenue and 29% of group's Adjusted EBITDA. Revenue increased by 66%, and Adjusted EBITDA by an exceptional 138% with new depositing customers by 67%. As mentioned before, versus last year, several new states in the U.S. contributed with Tennessee and Michigan and Virginia and also the recent Arizona and Wyoming launches. The two acquisitions of course, as mentioned before as well, with Lineups and the i15 Media assets. Outside of North America in our European core markets, sports showed growth in Italy and in the United Kingdom, while Germany has still declined versus last year. Latin America, we saw very solid growth in search traffic, which very much lays the groundwork for more significant revenue inflows in 2022 and beyond.
Finally, our financial trading segment. That's the smallest segment, which represented 2% of total group revenue and no EBITDA contribution during this quarter. Excluding the divested Hammerstone business, for a like-for-like revenue comparison, that revenue decreased by 23% as a result of several items. One was the end of COVID-related lockdowns that had a negative impact on users' traffic relative to the third quarter last year, but also slower than usual summer season that we have seen due to lower market activity.
The flagship brand AskTraders recorded solid growth, and we see very positive development opportunities in new Asian and also African markets. Turning over from the segments to the cost development, total costs excluding items affecting comparability was at EUR 17.1 million, which represented a cost ratio of 52% of revenue, and that's in line with previous quarters and also the third quarter last year as you see. Direct costs increased mainly as a result of higher revenue share spend that relates to Social Casino in the U.S. where we collaborate with YouTube influencers in that market. Personnel expenses increased by 40% year-on-year. As Michael indicated before, that is also the result primarily of continued investments in the growing North American market in particular.
Else, other operating expenses increased by 34%, and that likewise reflects our investment into future markets and also existing ones in Europe in relation to our transformation program. Majority of those cost increases relate to search engine optimization, content and technology, AI and BI related product investments. Extraordinary expenses, such as are treated as items affecting the comparability for the Adjusted EBITDA, was EUR 1.1 million in total during that quarter. Adjusted EBITDA as a result of that was at EUR 60 million in the third quarter. That is an increase of 33% year-on-year and a margin of 48%, which is exactly the same as last year's, despite the heavy investments in personnel and other operating expenses to prepare for further and future growth.
The last 12 months of Adjusted EBITDA is close to EUR 70 million now, and that number is an increase of 55% as compared to where it has been two years ago. The profit for the period turned negative as a result of the extraordinary non-cash impairment charge that Michael mentioned earlier that related to a write-down of German and French sports asset following a management review, which have been acquired in the period of 2016 up to 2018. Interest payments were reduced as an effect of the refinancing before the summer, where we replaced the old bonds with new bonds and the bank financings. Note however, that interest in relation to our hybrid capital securities is accounted for directly in equity and amounts to roughly EUR 1.1 million per quarter as of now.
As a result of that, the earnings per share before dilution were -0.51 EUR, again, as a result of the non-cash impairment charge during the quarter. Operating cash flow grew by 17%. Catena Media's business has a very strong cash flow generation and a very solid cash conversion. Operating cash flow was EUR 9.9 million during that quarter. That's a cash conversion of 67%, and it's also in line with the quarterly trend from the second quarter into the third quarter, as you see here in the chart and as we have seen last year as well. Cash flow from investing activities includes the initial payment of EUR 10.6 million. That was $12.5 million in relation to the i15 Media assets acquisition done in September.
Cash flow from financing activities included an outflow in that quarter of EUR 3.5 million in relation to the start of the share buyback program in the middle of September. After the reporting period and until the middle of October, in total EUR 8.6 million has been spent on share buybacks. As a result, at the end of Q3, cash and cash equivalents were at EUR 28.6 million. The capital structure continuously improved. As you see on the graph to the right, Catena Media has been on a significant debt reduction journey since the start of last year. A key element in that journey has been the successful refinancing and the issuance of our hybrid capital securities during the summer last year, which exchanged parts of the debt with equity.
Since then, as a result of the strong cash generation in the business, we have further deleveraged, reduced that debt from a net debt to Adjusted EBITDA ratio of 1.68 at the end of the second quarter last year to 0.64 at the end of the first quarter this year. Since the first quarter then, the leverage ratio has slightly increased again to 0.87 at the end of this quarter, and that has been the consequence of the aforementioned acquisitions and the initial purchase price payments for Lineups in Q2 and now for i15 Media assets in Q3.
The total borrowings in the balance sheet are at EUR 88.5 million and comprise our new bond, a bank term loan that is amortized on a quarterly basis, and a rolling bank credit facility of EUR 10 million that has been fully utilized now in the third quarter. Net interest-bearing liabilities were at EUR 59.3 million, and again, representing a leverage ratio of 0.87 and in line with our financial targets. The final slide of the financial section, our continuously strong balance sheet. As of 30th of September, total assets were at EUR 364 million . On the equity and liability side, the total equity was roughly EUR 221 million, including the hybrid capital securities of EUR 44.6 million .
That's the outstanding nominal value of EUR 53.1 million net of issuance costs. At the end of that period, approximately 34.5 million warrants have been outstanding. These warrants expire during the exercise window after the second quarter interim report in 2024. Until then, they will be able to be exercised. Amounts committed on acquisition are those deferred purchase price considerations for Lineups and i15 Media assets. EUR 10.6 million after this reporting period have been already settled now in October with roughly 2.2 million newly issued shares. That was in relation to the i15 Media asset acquisition. Another EUR 16.6 million or roughly $20 million, are due within the next 12 months, until the end of Q3 next year.
With that, I will hand back to Michael, who will continue with an update on strategy and market outlook.
Thank you, Peter. Talking through the strategy and outlook, our strategy remains consistent. You'll recognize this slide from prior presentations. This is our plan for this quarter, this next year, and this next decade. We are focused on organic growth first and foremost in growth markets and as well as mature markets and incubating markets. Geographic expansion of our existing products, which is showing success in markets like Japan in this quarter. Cost efficiency improvements in markets like Germany, the U.K., and even in North America, where we can maximize those markets through advances in technology and being more optimized with our teams using things like AI content and our data optimization of funnel.
Strategic M&A, again, as we demonstrated in this quarter with the pickup of i15 Media and Lineups.com last quarter, and we will have additional M&A in the future when the opportunities present themselves, but not discounting from our focus on organic growth. Let's talk about where some of that opportunity lies. North America is the unparalleled opportunity at this point in our journey. We are currently at about 119 million people in the U.S. that have sports betting and casino online or casino and sports betting available to them. That's about 35% of the population. Of that is not even, as we'll talk on the next slide, not all of them have full access to an open market online. That is about one-third perhaps of the total U.S. or market population that will be available.
We've got an uptick of about another 14%, which we'll talk more in depth on in the next slide. We've got a couple of giants still remaining unknown and when they might come in at another 20%. Then there's about another 30% in other states that are further out potentially, but still large and small. Some of those "further out" are not that far out if you talk about states like Ohio and Massachusetts that are talking very seriously about adding sports betting and/or casino online in the not too distant future. Our business in North America continues to flourish and grow as a percentage of our overall business, with that pendulum will likely continue to swing in the direction of North America for some time.
Our entire team, which are working very hard in North America, but the global team are working very hard to offset that growth in North America and grow us everywhere so that we can swing that pendulum back to keep some sort of balance across all the markets, which will normalize the sports seasonality, et cetera. But North America is an unparalleled opportunity, and we will maximize this for our investors. The upcoming market openings in North America. We had Arizona launch in September. It was a significant state with a significant number of operators. It was very good for Catena Media, thanks to our positioning and the work done by our teams over the last number of years, as well as the acquisitions to be ready for this launch. Wyoming also launched in the quarter. It's a very small state.
Connecticut has launched since the quarter's end, during the very end of the quarter. Again, a smaller state and a very few number of operators, so not a real driver of the business. It has both sports and casino, so long term has good potential. Mississippi is another small state with the limitation on in-person registration, which for an online affiliate, will limit our ability to affiliate there for a period of time. However, all these sorts of steps move us in the right directions fundamentally for North America, 'cause all those laws and regulations will change over time in opening up more states in the foreseeable future. Same with Florida, a very large state, one of the giants, but it's launched now with a single operator.
There is a very high potential that in the not too distant future, there are multiple operators running there under one of the many types of mechanisms and structures that have been proposed there, as well as a number of lawsuits that are existing. We expect good things from Florida in the future. That won't be this quarter, but it will come next year sometime, we would expect. Illinois, another that is a good-sized market that currently requires in-person registration, but is expected to change at the end of Q1 next year as their law indicated that it would take 12 months from the first land-based to launch to when a first online registration could occur.
There were some interim periods during COVID where they allowed a temporary exception to that rule, but they are now back in force, and so we expect strong marketing from the operators online and good affiliation starting in Q2 or so of next year. Speaking of next year, Ontario, which, you know, could have been as early as this quarter, but looking more like it's early 2022 for a launch in the first large Canadian province to bring online casino in a market that's going to allow for affiliation with multiple operators. We're very excited by this. We are very well-positioned with a number of sites, both some national Canadian brands as well as province-specific. Look forward to more provinces coming online for both sports betting as well as potentially casino. New York. New York is another one of the giants. Very interesting.
We are very well-positioned there. It is a very good-sized market, and I don't have a better word, it seems, than to use very when I describe it. It is an exceptionally strong market. We expect it to launch with very high business levels from nine operators that have been approved for the market. We work with many of them already in other states. We expect to work with most of them in New York, and expect a strong affiliation to start sometime in early 2022. Again, there are expectations from the market that that could be as early as Super Bowl 2022. Regardless of when it launches, it will be a good driver in 2022 and for many years for Catena Media. We look forward to a strong 2022 just on what we know about today.
If you recall, at this point last year, we were only thinking that Michigan and Virginia would launch in 2021, and they launched in Q1. By Q3, we had numerous other states launch, and then Q4, we've had a few more coming. The things can change considerably very quickly in North America and do continue to. Very exciting times. Which leads me to the summation. We had a very strong quarter, thanks to the work in North America and Japan and all the teams globally. I'm very pleased with our teams and very excited by the things I see beyond the revenue metrics that indicate good times ahead for our company in both 2022 and, again, the decade ahead. We do have a strong balance sheet and cash generation creating financial flexibility.
We are going to focus on investing in our business to drive further growth. That is going to be regardless of whether a state launches or not in the quarter. Arizona masked some of our investment maybe because of its strong launch, but we will invest heavily in this quarter and in the next year, 'cause this is not a one-quarter race. This is a multi-year strategy that Catena Media is undertaking, and our intention is to win on the multi-year strategy. We will continue to do strategic acquisitions and look at share buybacks as tools within our toolbox. There is seasonal impact expected in Q4. The NFL season started in September. That's the highlight of the affiliation point, boosted by the launches in Arizona. Football season in Europe is slowed in Q3, end of Q3.
Q4, we're seeing some revenue challenges there from operators on rev share and players winning, which is, you know, drives the business in the long run, and in the short run may hurt rev share. Our assets continue to add to our business and the things we have acquired, and there is just a significant amount of potential in Catena Media in the next twelve months in North America and beyond globally. I believe we are still one of the strongest investment cases in the industry. We make top line and bottom line improvements, and we do this globally. I think we are on a great journey ahead, and I just wanna thank the teams and the investors for coming along with us on this journey. With that, I think we will open it up to questions.
Thank you. If you wish to ask a question on the phone lines, please dial zero one on your telephone keypads now to enter the queue. Once your name is announced, you can ask your question. If you find it's answered before it's your turn to speak, you can dial zero two to cancel. Our first question comes from the line of Mikael Ljunggren of Carnegie. Please go ahead. Your line is open.
Yes, thank you, starting with Q4. You had a 21% growth in October, and the U.S. continued to grow strongly. Can you tell us something about the European side, how the casino side and the sports products developed in Europe? Also, if it's possible to quantify the impact from the low sports betting audience initially here in Q4 in Europe.
I'll start with that, and I'll then turn it to Peter for any additional insight. Q4 in Europe, we continue with our transformation efforts in certain products in Germany. We are seeing indicators on traffic and keywords that indicate we are moving in the right directions. We are still slow on operator development in terms of casino, where we are particularly strong or stronger. Sports is starting to move. We've had the Netherlands, which is launched, but again is still sort of getting their feet under them in the marketing roles and the operators. We are growing traffic there and keyword positioning, so expecting those to come along as opportunities as we go into 2022, not so much probably an impact on Q4.
Across Europe, what I am seeing with the teams and with the leadership that we have there is a strong focus on improving the products and our positioning and the revenues to follow. I expect a strong 2022 in terms of European football and other sports as those seasons kick off or grow stronger in the spring. Peter, any further comments to that?
No, I don't believe so. I think we have covered everything.
Just clarification there, maybe take it from another angle. If you can maybe talk about and explain how much of your European sports business that is driven by rev share contracts? How much is?
I don't know that we break it down by actual divisional unit. We do break down where our rev share sits in the global picture of CPA r ev share , et cetera. More r ev share share of the business is from Europe because North America is essentially an entirely CPA business. You know, you can extrapolate that a lot of that r ev share is the European business. Though of course, I should note that Japan and other markets that are coming along are also on r ev share . We don't break it out fully, but rev share is impacted. It's not just Europe, it's where those sports are followed, which are essentially the sports that aren't followed in North America are followed more globally.
Those are the ones where the odds have gone in the favor of the players as the operators have been reporting. While the affiliates are on a slightly different cycle where we do r ev share with those operators, that has impacted us, so. I think you see that essentially in the October trading update that it's you know 21% year-over-year. If that impact hadn't been there, it probably would've been higher.
I got it. Thanks. Another one on the Dutch situation. Several operators had to cease services for Dutch residents in October. Did you see any impact on your European business from this?
I'm sorry, ask the start of the question again. From what?
I mean, several operators have reported that they have ceased services for Dutch residents starting in October. Several of them have quite high exposure to Dutch markets indirectly. I was wondering if you have seen any implications on your European business?
Nothing-
During the start of Q4.
Nothing from the negative impact. Again, we've been growing our regulated business in the new Dutch market that has launched and are moving forward with that. There's been a series of operators, as you may be referencing, that have been in or out of the market unexpectedly, potentially based on their prior activities. So it changes the landscape on which operators we work with. As long as there are multiple operators, it is a good affiliation market. It is a small market, let's face it, in the grand scheme of the world, and it is very small for us at this point. But again, all markets start small and grow from there. We have a healthy site or two running in that market and growing.
We didn't do massive investment in buying assets there because we didn't see that as the best use of our capital. The organic growth I am very pleased with by our teams, and again, revenues will grow to follow.
Okay. Just one question here on the U.S. sports seasonality. If you can remind us how that develops typically in Q3, Q4.
Sure
The underlying activity, what we should expect, August, September, October, November, and so on.
I'd be happy.
What this means for customer acquisition activities.
Absolutely. There is an acquisition cycle that is somewhat in relation to the sports seasonality of the NFL in particular, which is still probably 90% of the affiliation occurs for sports in North America related to the NFL season. I will be very careful about using the word typical, because in the couple of years now we have had sports launch in North America and more states added every year. I'm not sure anything has been exactly typical. We've had numerous states launching in the middle of the NFL season in the last year, like Tennessee. We've had only a few states in the first year of sports in North America. It has been. There was this whole COVID thing that sort of impacted last year's launching of sports and how games ran. The typical is not typical as of yet.
Expectations from what we've seen from our research of how it even worked for offshore operators for many years is September is the highest peak of affiliation for NFL, for North American sport. That falls off by 30%-50% in the October timeframe, depending on, again, how the NFL season is going for and which states and where the teams are positioning. It falls off again a little bit in November. In December you start to see pickup as you head towards the teams are become clear that are headed into the playoffs, which occur through January, up until a very high point once again at the Super Bowl at the start of February. That's sort of the affiliation cycle.
Again, we are CPA driven in North America at this point, so we are taking that on the front end in many cases. The operators are spending months growing their revenues and catching up basically on what they've already invested in that CPA for that acquisition of a high-value player.
Great. That's really helpful. Thanks. Just my final one, if you can comment on your recent acquisitions. Maybe say something about how we should think about the development ahead. Because in 2020 and 2021, I think they had a rather high volatility in their revenue generation. Just to understand the underlying trajectory for them.
Yes. I think yes, they have high volatility, as do we, quite frankly, in some of these state launches. You know, Lineups.com and i15 Media were well-positioned for Michigan as we were, and they saw spikes like we did. Not as high, but now that becomes additive to the Catena Media portfolio for all future states, as we saw in Arizona, as we'll see in New York, and as we'll see in states beyond that, Ohio, Massachusetts, California, Texas, et cetera. The volatility is, I'm afraid, going to be unavoidable. I know it's not an investor's favorite thing, but the sports seasonality amplified by state launches, Arizona launching in September, the busiest sports season in North America, busiest month, highest month for affiliation.
Add to that now a relatively large state launching with a lot of operators, it went stratospheric in some ways, compared to September without that. All these things and the interest levels in North America just continue to make it very volatile. Always on an upward and continuing upward trend for Catena Media. Again, for Catena Media anyways, with a bottom-line growth that matches or it goes along with the top line.
Okay, great. Thank you.
Thank you. Our next question comes from the line of Erik Moberg at ABG. Please go ahead, your line is open.
Morning, thanks for taking my questions. Just if we look at from 2021 and beyond here, you mentioned about growing organically in the double digits mid-term and into 2022. It would just be interesting to understand the context a bit better. If we start with Europe, given that Germany been declining, do you still expect this part to grow double digit or sort of just remain flat?
I expect it to grow, Erik. We expect all parts of our business to grow. Double-digit growth.
Yep
This is the company's global expectation. Will Europe make double-digit? That is what we're pressing for. It is hard, I will admit, in Europe with organic growth being matched to. We still had a very healthy Q1 last year from places like Germany. Germany is not the market it was, given how it regulated in the middle of this year. It is difficult for them in the year to reach the double-digit level, but for the company overall, I don't see that as at all a challenge based on North America, Asia, Pacific, et cetera. Europe will fully expect it to, over the course of 2022, reach the point where on a month-over-month comparison, it is reaching that double-digit number once again.
Understood. On Germany, would you say that this part of the business have troughed and, or it's a level now where it would start growing again sequentially?
I think it is. I feel like it has troughed. Again, the challenge in our business is always what are the outside influences and the factors and operator moves, their marketing budgets as they figure out their 2022 and where they're going to invest globally. It feels like we've reached a low point for the market in general. It's starting to stabilize. They're starting to make moves. We're seeing traction, as I indicated, on our underlying product fundamentals. While it won't be a stratospheric growth like a launch of a state in North America with 20 operators like Arizona, I'm expecting to start to move in the direction of positive for Germany on a month-over-month.
Year-over-year, as I said, there's still some comparables that make that difficult for them to be year-over-year growing yet, but that day will come.
Understood. On the U.S., if we sort of strip out any potential new states, and just look at existing states, at what rate do you see this part grow going forward? Just so we get a better understanding where you expect a sort of 2021 base on existing part of the U.S. ahead.
Expect growth across a ll the states. I don't know that we're breaking out particular numbers for the same store sales, so to speak. But we do track that. We pay attention to that 'cause that is important for our growth, obviously is not just to rely on new states. We have to be a growing business outside of that factor, and we are. Particularly, though, I should note that the states with online casino will continue over time to trump the sports betting states if they're just sports betting, because online casino doesn't have seasonality in North America that we've seen so far. Player values and the operator value for those players is just so much higher.
Every time a state with casino comes online, it shows the value of the long game there, and we expect that still is the greatest game there is to play.
Makes sense. You don't expect any sort of hangover effect from the existing states here going into 2022?
From the existing states, I'm not expecting that, but we're still. Again, based on what's happening with this, quote-unquote, "typical" sports season, which is never typical, we're trying now to project what that means for next year and what are the baseline levels for some of these states. 'Cause it seems that 2019, 2020 are very difficult to use 'cause some of these states didn't exist, and we had COVID. It continues a very difficult thing for people like our divisional VPs and Peter to help us try to project what is the next year going to hold. We know it holds growth. Just exactly how that plays out is difficult.
All right. On the new states and potential new markets here overall, I mean, in the U.S., you touched on this before in your presentation, but if we just look at New York, obviously it's a very interesting opportunity. How large can it be if we compare versus the affiliate market in New Jersey?
New York is, let's say, two x the population of New Jersey, but it is only sports launching at this point. New Jersey is starting with a fewer number of operators, but New Jersey's now running 20+ sports betting operators in that state, I believe, and 26 or something like that on the casino side. New Jersey has a lot more operators running. New York, though, I think from the affiliation side in this first year will be very strong because you have nine now large operators who are looking for North American domination, who are going to go head-to-head in a very large state that is not just about the player values, but is about their corporate presence in the marketplace and how much they control of New York.
I think it could be a very interesting affiliation market in this next year, and probably will have that hangover effect the following year is my guess. I think we have other states that will offset that. New York, though, big market. Sports only. Strong start to affiliation expected. Strong first year for Catena. Years after that, hard to say. Again, at some point in the not too distant future, I do expect we'll start to see online casino enter a number of these states as well.
Just to follow up on that, just sort of the dynamic here, New York versus New Jersey, do you see a risk that New Jersey decline when New York opens up?
There has always been an understanding that some percentage of the traffic into New Jersey comes from New York. That would impact sports betting. The good thing, and I know we get beat up for it sometimes in being only CPA in North America, but because of these nascent markets, sometimes it's very good to be CPA because we've taken a CPA on some of these players probably in New Jersey that now will be New York players. It opens up a second round of affiliation for us potentially. That would be different potentially on rev share, but we're not on rev share in North America at this juncture.
Operator, I'm probably gonna ask to make sure we're giving enough time for everyone to ask questions, so I'm probably gonna cut it at three questions a person.
Okay. Fair enough. Thank you very much.
Thank you, Erik. I really appreciate your time.
Thank you. Once again, if there are any further questions on the phones, please dial zero one on your telephone keypads now.
I believe while we wait for further questions there, we have received a couple of questions via the chat function here in the stream. Before I will ask Michael to maybe comment on any potential U.S. listing, there's also questions in relation to our share buyback and dividends and our overall toolbox. Let me comment on that briefly. Nothing is really removed from our toolbox. That is more a question of the timing. Keep in mind that dividends of course have to be approved and resolved by a general meeting. On the share buybacks, we have started based on the mandate that our board of directors received during the summer a buyback program in the middle of September and put that on pause when we went into the closed period.
We will have an opportunity to continue with that share buyback, now as we have released the report for the third quarter. It will not be that comprehensive as previously, and the reason for that is that we have certain compliance criteria from a Maltese Companies Act perspective to take into consideration here as well. That relates not to the cash that the business of course is generating and has available, but more so on the distributable profits, on a company holding level. These distributable profits have been impacted during this quarter by the impairment charge.
What can be expected is that there is some buyback going forward, but not to the same extent until the end of this year when the balance sheet has been sorted out and we can go into the next year and see that the distributable profits on that level can resume. Maybe Michael, you can comment on any potential U.S. listing.
I'd be happy to comment on that. Thank you, Peter. I think this is one of our most common questions I see in the chat, and it's a very good question. You know, we are very seriously investigating how to maximize the market opportunities in North America, and that is both from the affiliation side as well as the investment strategy and positioning of the company. You know, as I sit here in Las Vegas at a little past midnight, we recognize that there is a need to grow our investor base in North America, and what are the tools in our toolbox we can do that?
To what Peter just referenced about rules in Malta, where we're headquartered for very good reasons, and being listed on the Nasdaq Stockholm, there are many things we have to understand in the journey towards getting a U.S. listing. We are interested in it. We are exploring it. We will explore it. We have not committed to it yet because we have to ensure that it is in the best interest of our current shareholders and the overall company's future. Seriously looking at it, I spend a lot of time on this, as does Peter. We will be spending more in 2022. It is a journey, and we're not going to say it's an absolute yet because we want to be certain that we are doing the right thing for all involved.
Spending a lot of time on it because it is the hottest market, not just in affiliation, but in investment interest in this space. I saw also in there, Peter, a question around LATAM. LATAM America is a great opportunity for the future. Just like we're seeing Japan now starting to take off and more of APAC and Asia-Pacific be opportunity for the nearer term, Latin America is a longer term. We are running over a dozen sites in Latin America at this point. A lot of heavy interest on Brazil, but many other countries there are starting to show regulations. They're starting to get payments figured out, which are important for operators to be able to run.
It is an organic growth strategy for us right now, but it is not absolutely ruled out on M&A because there may be opportunities at good multiples to pick up more starter assets, particularly strong teams as in addition to products. It is an opportunity we look at. We have a strong team there and people across the globe who help with that team to try to figure out how to maximize what is probably going to be more of a volume versus value play for quite some time on rates we'll see from individual players. The volumes are amazingly high on what you can do in those markets over time. It's not for our 2022, but it is part of our long-term strategy, and we are investing in it.
Let's see, looking to some other questions, Peter, anything else we should comment upon?
Yeah, maybe as we had in previous quarters, questions in relation to our setup that we refer to CPA-based in North America, very mixed in other parts of the world. Also the questions from Mikael and from Erik earlier in relation to revenue share in Europe and so forth. The development of maybe revenue share agreements potentially in the future in North America.
Absolutely. I think we'll all recognize that rev share in the right environment is a great tool for long term. It creates a recurring revenue, which gives a more stabilized growth rate. We are CPA in North America for a couple of reasons right now. There are the market conditions of the operators continuing to move into new states and not really optimizing their affiliate channel, which means the tools and things that we see in other markets haven't really been developed in North America for tracking revenue share. We have the challenges behind consolidation. We've seen, you know, we've acquired, others have acquired in the affiliate space. It looks to me and to us like there is still probably some consolidation to happen on the operator side. Typically, those are not very good for affiliates.
As long as there are multiple operators, and we can do multiple CPAs to a number of them for players over the next few years, it extends out the value on what would be a rev share. If we provide a CPA for one operator, and we want to provide lifetime value of high lifetime value and not immediately go seeking to turn that player somewhere else. Say in 2-3 years, that player is looking for a second place to play. If we affiliate that player a second time at these exceptionally high CPAs, that makes for a very long rev share before we see the same return. We can use that cash in our proverbial pocket in order to invest in the future states, which is what we're doing without having to grow additional debt.
Right now, we're using this to fuel the business. Rev s hare will come. We're looking and talking to the operators always. We're not going to accept rev s hare of some of the historics in North America, where daily fantasy was done on a rev s hare, but only with a two-year cap. The lifetime values versus the CPAs say that doesn't make sense quite yet. Rev s hare, I think there will be a tipping point for North America. We're not there quite yet, so we're going to stick to this. It is something our board challenges us on at every opportunity, as they should. It is not something we are oblivious to. It is something we are strategic about.
Excellent. Maybe one comment from my end in relation to some investments, in particular technology investments. With the growth of the company, and particularly in North America, there naturally comes a scaling question in operations as well. The operating model and more so the synergies of running a lot of states, not only in North America, but then also the part of the European business. Technology investments is all about that. How can that be further supported, be it through artificial intelligence-based content creation, for example, and other technologies, so that the scaling effect is better? This is not a short-term investment in terms of an ROI perspective. This is really a long-term investment. The same is true for all these product investments, in particular as part of the transformation program that Michael talked about before as well.
We do expect during the next year to see certain effects positively out of these investments that we've been doing this year. This is partly quite significantly revamping certain ways of how we run products and create content over that. That's more a long-term return on investment perspective that we have here. Just checking with Mark, our operator. Are there any other questions on the phone line?
Currently no further questions have come through on the phone lines at this time. Just as a reminder to participants, if you do wish to ask a question, please dial zero one now. No, it seems there's no further questions at this time on the phones.
With that then, I think we will conclude this session. We again appreciate everyone's interest in Catena Media. I again want to thank all of our team for an exceptionally good quarter in Q3 and an extremely strong future with our aspirations for 2022 and beyond. We believe the stage is being set for that. Again, thank you everyone, and we will talk to you again soon.
Thank you.