Better Collective records 40% Q2 revenue growth despite US sporting lull
Affiliate group Better Collective generated revenue of €56m in Q2 2022, an increase of 40% over the prior-year period.
This, the firm said, gave an organic growth rate of 22%, in addition to further growth driven by Better Collective’s acquired businesses.The year-on-year growth came despite the annual Q2 lull in the US sporting calendar and an “exceptional” comparative period in Q2 2021.
Better Collective’s sports win margin was higher than in Q1 but still below Q2 2021 levels, it said, with an estimated impact of €7m compared to last year’s second quarter.
Q2 group EBITDA before special items came to €12.2m, a decrease of 3.9%, giving the business an EBITDA margin of 22%. Better Collective’s publishing segment showed an EBITDA margin of 26% while the paid media segment’s margin was significantly lower at 12%.
The affiliate’s US business – including Action Network – registered an EBITDA loss of €1.8m, which Better Collective said was as expected, reflecting seasonal impacts on group revenue and further ongoing change from a cost-per-acquisition (CPA) business model to a revenue share model in its partner contracts.
That change will be “transformational” for the company’s US segment, it said, with the impact of short-term costs upon EBITDA levels already absorbed by continued growth across the business.
Better Collective co-founder and CEO Jesper Søgaard: “Our geographical diversification really proved its worth as the Europe & RoW Publishing business continued its strong momentum for both revenue and earnings.
The affiliate still expects to meet its anticipated market growth in the US, it added, with revenue from the region expected to exceed $100m by the end of 2022. It also expects the US business to deliver full-year profitability in line with the broader group.
Better Collective saw over 387,000 new depositing customers using its services during the quarter, some 93% ahead of the prior-year period. Of those, 310,000 – or around 80% – were sent on revenue share contracts.“Q2 was a productive quarter. Revenues from revenue share contracts as well as NDCs were an all-time high of €22m and more than 387,000, respectively,” said Jesper Søgaard, co-founder & CEO of Better Collective.
“Our geographical diversification really proved its worth as the Europe & RoW Publishing business continued its strong momentum for both revenue and earnings. Our US business showed 90% 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,” he concluded.
Jesper Søgaard: “Our US business showed 90% 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.”
Significant events during the period included Better Collective’s acquisition of Canada Sports Betting in March, ahead of Ontario’s regulated online sports betting and iGaming market launch in April.
Better Collective said it has been “very satisfied with the development of the asset.”
Following the end of Q2, the business saw revenue reach almost €17m in July, representing year-on-year growth around 36% for the month.The business also signed a number of new media agreements, including with the Chicago Tribune and German multi-channel sports platform SPORT1.
Today (23 August), the business announced a further new agreement with Boston.com, part of Boston Globe Media Partners. Boston Globe Media is a multimedia news and entertainment organisation operating across multiple brands and platforms.
Better Collective said the business is also the region’s leading digital destination for trusted information on breaking news and sports, serving millions of readers each month.
The newly agreed partnership with Boston.com will be co-branded with Better Collective’s VegasInsider brand in order to provide content, data and statistics for a new online sports betting section.