Better Collective anticipating ‘action packed’ H2 after ‘solid’ quarter

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Better Collective expects to “remain active” in the M&A space with a “strong” list of targets the focus for a group that is anticipating “all time high activities” through H2 following a solid second quarter.

This saw revenue grow 40 per cent during the April to June time frame to close at €56m (2021: €40m), which was delivered despite “an exceptional” quarter one year earlier and low seasonality.

The publishing division grew 46 per cent to €38.12m (2021: €26m), while paid media jumped 28 per cent in Q2 to €17.91m (2021: €13.95m).

On a geographical basis, Better Collective’s Europe and the Rest of the World segment, buoyed by Latin American operations, grew 30 per cent to €42.87m (2021: €33m), with the US surging 90 per cent to €13.17m (2021: €6.95m).

Despite EBITDA tracking at a loss of €1.8m (2021: €1.8m) through the quarter, the company maintains an expectation of surpassing €100m in revenue by the close of the current year and delivering profitability in line with the group strategy.

Group EBITDA before special items through Q2 dropped three per cent to €12.2m (2021: €12.7m), with new depositing customers also doubling to 387,000 (2021: 197,000).

Jesper Søgaard, CEO & Co-founder of Better Collective, commented: “Q2 was another productive quarter with 40 per cent growth. Revenues from revenue share contracts as well as NDCs were an all-time high of €22m and >387.000, respectively. 

“Our geographical diversification proved its worth as the Europe & RoW publishing business continued its strong momentum for both revenue and earnings. 

“I now look forward to an action packed H2 where we expect all time high activities in Q4 “

“The US business showed 90 per cent topline growth and a negative EBITDA, which runs in line with our strategy to continue large scale investments in what rapidly has become our largest single market.”

As the firm also discloses its latest US-based commercial partnership alongside Boston Globe Media’s, revenue through the first six months of the year increased 57 per cent to €123.43m (2021: €78.84m).

EBITDA before special items rose 37 per cent to €35.33m (2021: €25.85m), with NDC’s falling a fraction shy of doubling once more after closing at 737,000 from 371,000 one year earlier.

Overall, the cost base through H1, impacted by the addition of Action Network as of May 2021 and the continued investment in building US business, increased 66 per cent to €88m (2021: €53m).

Through July, revenue was 36 per cent ahead after closing at €17m, which is reported as slightly ahead of internal expectations.

“M&A is part of our DNA and our target list remains strong,” noted Søgaard. “We expect to remain active, but we also have a clear focus on our capital allocation and are aware of the current market turmoil that makes capital raises less relevant – and sometimes share buybacks more relevant.

“On the back of this we are working on other financing options should an opportunity arise.”

Adding: “Since founding Better Collective, we have managed to stay largely unaffected by the business cycle and the external environment – a trend I expect to continue. 

“I now look forward to an action packed H2 where we expect all time high activities in Q4 mainly driven by the NFL kick off and the new FIFA-game launch in September (only to impact one month of Q3 but with full effect in Q4), and most major sports leagues being live. 

“Lastly, I look forward to the 2022 World Cup being played out in November and December – conceivably, under upright conditions and in the interest of football. I feel extremely confident in our strategy and position in the market, all which makes us well prepared to execute.”