Better Collective has reported strong Q2 2024 results and disclosed a revised, lower acquisition price for Playmaker HQ following its underperformance.
In Q2, Better Collective achieved a 27% year-on-year revenue growth, reaching €99 million, with organic sources contributing 5% to this increase. Recurring revenue also rose by 26% year-on-year to €62 million, making up approximately 62% of the company’s total revenue.
This growth was fueled by positive trends in Better Collective’s revenue share income, an unexpectedly high sports win margin, and successful integration of acquisitions, which bolstered recurring advertising revenue.
EBITDA for the quarter held steady at €29 million, with a margin of 29%, aligning with expectations despite recent acquisitions, including Playmaker Capital and Playmaker HQ, which have not yet significantly impacted profitability.
The company reported increased investments in adtech and AI capabilities, particularly focusing on its AdVantage platform.
In contrast, the previous year saw a 135% surge in EBITDA, driven by strong North American performance and substantial upfront payments.
During the quarter, Better Collective acquired 501,000 new depositing customers (NDCs), 82% of whom are on revenue share contracts. The UEFA Euro 2024 played a major role, contributing over 100,000 NDCs.
Additionally, the affiliate noted that its new content strategy for European sports media has yielded positive results, boosting audience growth.
“Thanks to a great team effort, we managed to deliver a strong Q2 in a time of changing market conditions,” said co-founder and CEO Jesper Søgaard. “Our existing business is back to organic growth, and I am pleased to see that our diversified strategy has performed as envisioned.”
Earlier, in Q1 2024, Better Collective reported a 13% year-on-year EBITDA decline and a 6% drop in organic revenue growth.
Q2 Developments
In Q2 2024, Better Collective announced the acquisition of AceOdds, a UK-based sports betting media company, for €43 million. The integration of AceOdds into its operations has been smooth, with the brand exceeding initial expectations.
Conversely, Better Collective had to renegotiate the terms of its Playmaker HQ acquisition due to underperformance. Originally valued at up to $54 million, including $15 million upfront, the final price has been adjusted down to $23 million — a $31 million reduction.
This renegotiation led to a €2.4 million negative impact on special items, primarily due to a goodwill write-down and the recognition of the remaining earn-out as income.
Despite this challenge, Better Collective remains optimistic about Playmaker HQ’s long-term potential. The company has restructured its commercial team to enhance performance, anticipating improvement in the latter half of 2024. However, the timeline for achieving these goals has been extended by roughly a year.
Future Outlook
Following the acquisition of AceOdds in Q2, Better Collective has upgraded its financial targets for full-year 2024. The company now projects revenue between €395 million and €425 million, indicating 21-30% growth, an increase from the previous forecast of €390 million to €420 million.
EBITDA is expected to range between €130 million and €140 million, representing 17-26% growth, up from the earlier estimate of €125 million to €135 million.
The company also aims to keep its net debt to EBITDA ratio below 3x, a target that remains unchanged.
Furthermore, Better Collective noted that Google’s decision to delay the phase-out of third-party cookies, announced in July, offers several advantages. The company can continue using established tracking methods, facilitating a smoother and potentially quicker rollout of its AdVantage platform.