BETTER COLLECTIVE A/S Interim report
Regulatory release no. 47/2023
Flash highlights
- Revenue 75 mEUR, growth of 26%; organic growth of 16%
- Recurring revenue 46 mEUR; growth of 49%
- EBITDA before special items 20 mEUR; growth of 35% EBITDA-margin 26%
- North American revenue share transition moving faster than expected
- Transformational acquisition of
Playmaker Capital secures market leadership inSouth America and strengthens leading North American position - The full year financial targets are maintained
- October trading update: Revenues of 24 mEUR; impacted by a significantly lower sports win margin than expected
- Application for admission to Nasdaq Copenhagen filed and first day of trading is expected to be
17 November, 2023
Highlights Q3, 2023
- Group revenue grew by 26% to 75 mEUR (Q3 2022: 60 mEUR). Organic revenue growth was 16%.
- Recurring revenue was 46 mEUR, implying 49% growth. Making up 61% of total group revenue.
- Group EBITDA before special items was 20 mEUR, a growth of 35% (Q3 2022: 15 mEUR). The group EBITDA-margin before special items was 26%.
- The full-year financial targets remain unchanged.
- Cash flow from operations before special items was 14 mEUR (Q3 2022: 13 mEUR). The cash conversion was 63%. By the end of Q3, capital reserves stood at 123 mEUR of which cash of 41 mEUR, and other current financial assets of 10 mEUR and unused credit facilities of 72 mEUR.
- New depositing customers (NDC) numbered more than 445,000 in the quarter implying growth of 27%. 87% of NDCs were sent on revenue share contracts.
- The North American contractual transition towards revenue share has been moving faster than expected. In terms of NDCs,
Better Collective grew massively during Q3 and sent approximately 65,000 NDCs, implying growth of 73%. Out of this, 64% were on revenue share agreements implying 42,000 NDCs, which equals 159% growth. - The content and social media company Playmaker HQ, was acquired in the beginning of Q3. With the acquisition,
Better Collective expanded competitiveness within social media and sports content production, and the total consideration of the acquisition was 51 mEUR (54 mUSD) with an upfront payment of 14 mEUR (15 mUSD). - Acquiring leading national sports media with a strong brand is an important pillar in Better Collective’s global strategy. During Q3, the group made multiple acquisitions executing on its strategy and vision to become the leading digital sports media group:
- In a transaction made with the
Everysport Group ,Better Collective acquired four of Sweden’s strongest sports media brands for a total purchase price of 3.7 mEUR. The four brands are; SvenskaFans.com, Hockeysverige.se, FotballDirect, and Innebandy Magazinet. Better Collective strengthened its South American position by acquiring the Brazilian sports media platform, Torcedores.com. Adding the first Brazilian sports media brand to the group,Better Collective also acquired an office inSao Paulo, Brazil .- Tipsbladet.dk was acquired for 6.5 mEUR, further leveraging Better Collective’s position as a key partner for advertisers in the Danish market.
- In a transaction made with the
- The club-financing from
October 2022 , with Nordea, Nykredit and Citibank was extended by three years untilOctober 2026 , together with the execution of the accordion option. In doing so the available facilities were increased by 72 mEUR, leavingBetter Collective with a total financing of 319 mEUR where 247 mEUR has been utilized. - A share buyback program of up to 10 mEUR was initiated and completed during Q3.
Better Collective acquired 187,991 shares at an average price of237.2 SEK . Following the purchases,Better Collective held 2.51% of the outstanding share capital. The purpose of the buyback is to cover future payments relating to acquisitions and LTI programs. - Secured proof-of-concept for Better Collective’s in-house adtech platform, AdVantage. The platform allows
Better Collective to gain stronger knowledge of its audience enabling it to better cater to and serve targeted and contextual ads. The first AdVantage campaigns have been run on Better Collective’s brands and media partnerships across eight markets. - For the nationwide day of action against gambling addiction 2023, Better Collective’s subsidiary, Mindway AI, entered a strategic partnership with the
German Sports Betting Association (DSWV). The partnership will see the integration of the innovative Mindway AI solution - Gamalyze, into DSWV’s homepage. Britt Boeskov andRené Rechtman were elected to the Board of Directors at an EGM on 8 August. Following six years of dedicated work forBetter Collective ,Klaus Holse decided to step down from the Board of Directors.Better Collective opened the doors to its new headquarters inCopenhagen . The leasing agreement runs for five years and has a rent obligation of approximately 12 mEUR during that period.
Significant events after the period
- The October trading update showed revenue of 24.3 mEUR, down 6%. Revenue and earnings were negatively impacted by an estimated
+8mEUR due to a significantly lower sports win margin than expected. Better Collective made its second largest acquisition to date, in a transaction to acquirePlaymaker Capital for a total price consideration of 176 mEUR.Playmaker Capital is a leading digital sports media group that owns and operates several strong sports media brands across theAmericas . The acquisition will be transformational forBetter Collective and will strengthen the group’s market leading position inNorth America , while also taking market leadership inSouth America . Note that despite having similar names,Playmaker HQ andPlaymaker Capital are not associated.- The closing of the transaction is subject to approval by the shareholders of
Playmaker Capital , court approval, applicable regulatory approvals, and certain other closing conditions customary in transactions of this nature. The transaction is expected to close before the end of Q1 of 2024, whereafterPlaymaker Capital will be consolidated into theBetter Collective group Better Collective’s 2023 financial targets are maintained, while it plans to revisit its long-term financial targets for the period 2023-2027 following the closing of the transaction. - In addition to Better Collective’s presence in
Sao Paulo , established with the acquisition of Torcedores the group opened the doors to a new office inRio de Janeiro . - Mindway AI entered another strategic partnership this time with the United States’
National Council on Problem Gambling (NCPG). The partnership will see the integration of Gamalyze, into NCPG’s flagship responsible gambling website; responsiblePlay.org - Better Collective’s Nomination Committee was appointed based on ownership data as per
August 31, 2023 . - In late September,
Better Collective announced its intention to carry out a dual listing of the group’s shares on Nasdaq Copenhagen, in addition to the current listing on Nasdaq Stockholm. The first day of trading on Nasdaq Copenhagen is expected to beNovember 17, 2023 .
Co-founder & CEO,
Throughout the quarter we continued our global expansion acquiring leading national sports media across four markets and following the close of Q3 we made a transformational acquisition of
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