Better Collective has seen a concerted push into North American markets move “faster than expected” as “value added transactions” maintain the group’s push for global expansion.
The latter saw the purchase of Brazilian sports media platform Torcedores and a $54m deal to acquire Playmaker secured during the year’s third quarter. Following Q3, the firm’s second largest transaction was secured via a definitive agreement to acquire Playmaker Capital for €176m.
This latest addition is said to represent a “significant step towards realising our vision of becoming the leading digital sports media group”, noted Co-Founder and CEO Jesper Søgaard.
“The acquisition fits perfectly with our strategy of owning and operating leading national sports media brands, and further strengthens our position as a preferred partner for businesses aiming to activate their brands in a relevant and engaging sports context,” it was stated.
Elsewhere, in a CEO address during the company’s latest financial breakdown, a continuous focus on securing recurring revenue streams across North America is said to have provided Better Collective “with a strong competitive advantage”.
Søgaard continued: “I like to think of our revenue share transition as growth in disguise. I remain highly excited about the transition, as our data tells us that North American customer lifetime values are very high compared to anywhere else in the world, and to fully capture this potential we need to operate on revenue share agreements.
“…this is something we must see through, as it simply is not an opportunity we want to miss out on”
“I would like to stress that this transitional phase will continue to have a short-term dampening impact on our financial performance in the coming quarters, also heading into 2024.
“However, given the above-mentioned factors, this is something we must see through, as it simply is not an opportunity we want to miss out on.”
These comments came during a three month period that saw revenue grow 25 per cent to €75.43m (2022: €59.72m), while operating profit reached €11.49m (2022: €9.63m) and EBITDA closed at €20m, up 35 per cent from €15m year-on-year.
New depositing customers numbered more than 445,000 through the quarter, which represents growth of 27 per cent.
This, said Søgaard, was broadly driven by media partnerships, which “continue to be a solid growth driver globally”, and the strong development in the group paid media division.
The former saw revenue increase 17 per cent to €48.46m (2022: €41.3m), while the latter surged 46 per cent to close the third quarter at €26.96m (2022: €18.42m).
“Q3 was another eventful quarter where we continued working towards sustainable future growth. Following the exceptional performance during the first half of 2023, Q3 landed in line with expectations,” he continued.
Adding: “During the quarter we recorded a normalised sports win margin following more favourable sports win margins in H1. We managed to deliver solid results despite I) it being the low season, and II) our continued investment into future growth in the North American market.”
“Zooming in on North America, I am very satisfied to see our significant growth in revenue share customers”
Geographically, the company’s Europe and the rest of the world division saw revenue close at €52.94m, up 27 per cent YoY from €41.591m.
With European markets consisting “of more mature markets” that “are the legacy markets of Better Collective”, South American is hailed as possessing “strong growth” that occupies “an increasingly bigger part of the business”.
Revenue across North America increased 24 per cent to €22.49m (2022: 18.12m), with Søgaard highlighting the “strategic vision and execution” demonstrated by its team.
“Zooming in on North America, I am very satisfied to see our significant growth in revenue share customers,” Søgaard noted.
“Across all the North American region we sent more than 65,000 NDCs during Q3, which implies a growth of 73 per cent.
“Out of this, 64 per cent were on revenue share agreements implying 42,000 NDCs, which equals 159 per cent growth.
“In the beginning of the year, we incorporated this transition into our financial targets, and we are pleased to see that the transition is moving faster than first anticipated.”
For the year-to-date, revenue is up 32 per cent to €241.5m (2022: €183.2m), with paid media leading an increase in costs to €159.9m (2022: €133.3m) and net profit after tax rising approximately 14 per cent to €32.3m (YTD 2022: €27.8m).
“This impressive development is truly a testament to the high-quality brand portfolio we have built over the past five years,” Søgaard concluded.
