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Sportradar Group AG, a leading global technology platform enabling the next generation of sports engagement, and the leading provider of business-to-business solutions to the global sports betting industry, today announced financial results for its third quarter, which ended on September 30, 2021.
Highlights for the third quarter of 2021
- Revenue during the third quarter of 2021 increased by 30% compared to the third quarter of 2020 to EUR 136.8 million (USD 158.7 million)1, driven by robust growth across all geographic areas and business segments
- Continued strong development in the US market with US revenues during the third quarter of 2021 which increased by 119% compared to the third quarter of 2020. For the nine months ended 30 September 2021, US revenues reached EUR 48.5 million (USD 56.3 million )1
- Adjusted EBITDA * during the third quarter of 2021 increased by 21% compared to the third quarter of 2020 to EUR 20.9 million (USD 24.2 million)1
- Strong dollar-based net holding ratio * of 128% at the end of the third quarter of 2021, which underlines the continued success of our cross-selling and additional sales strategy
- We have successfully expanded our partnership through 2028 with FanDuel Group, a leader in the US sports betting market, covering pre-match betting services, live betting services and betting entertainment tools.
- Successful listing on Nasdaq, raising EUR 546 million of primary net income to finance continued growth in the business, giving the company EUR 878 million to continue investing in global growth
- For the full year 2021, we expect revenue to be in the range of 553 to 555 € (641 to 644 USD)1 million and adjusted EBITDA * in the range of € 99.5 to 101.5 ($ 115.4 to $ 117.7)1 million.
Q3 |
Q3 |
Change |
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2021 |
2020 |
% |
||||
Income | € 136.8 | 105.3 € | +30% | |||
Adjusted EBITDA * | € 20.9 | € 17.3 | +21% | |||
Adjusted EBITDA margin * | 15% | 16% | -7% | |||
Dollar-based net interest rate * | 128% | 114% | +12% | |||
Adjusted free cash flow * | € 32.9 | € 13.5 | +144% | |||
Cash flow conversion * | 158% | 78% | +102% |
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1 For the convenience of the reader, we have translated the euro amounts in the tables below to the US Federal Reserve in New York on September 30, 2021, which was € 1.00 to $ 1.16.
* Financial measures that do not comply with IFRS; See “Financial measures and operating measures that are not IFRS” and the accompanying tables for further explanations and reconciliations of measures that are not IFRS and IFRS measures.
Carsten Koerl, CEO of Sportradar said: “Our strong results show the value we give our partners and customers around the world. We are the largest provider of sports intelligence in the world and the only profitable global sports technology platform on a large scale. Critically, we believe that we are also the most innovative when it comes to developing technical solutions that enable our league customers, media and betting partners to use our ever-increasing data to attract and engage sports fans. ”
Koerl continued, “We plan to continue to make significant investments, especially in the US The US represents the primary focus area for implementing our strategic growth plans, as the US region currently accounts for only 7 percent of our group revenues, states legalize betting and the market will expand from $ 1 billion in 2019 to an estimated $ 23 billion over the next 10 years.Our latest Nasdaq listing in the US was a huge milestone for our team, and we look forward to building on our success in a number of areas in the coming years. “
financial highlights for the three months ended 30 September 2021
- Income during the third quarter of 2021 increased by 30% compared to the third quarter of 2020 to EUR 136.8 million
- Adjusted EBITDA * during the third quarter of 2021 increased by 21% compared to the third quarter of 2020 to EUR 20.9 million
- Adjusted EBITDA margin * remains strong at 15% in the third quarter of 2021, a slight decrease compared to the third quarter of 2020 due to additional IPO costs of around € 5.7 million incurred in the third quarter of 2021. Eliminating the effects of IPO costs would result in a adjusted EBITDA margin of 20%, which illustrates our continuous ability to achieve operational leverage
- Dollar-based net retention rate * increased from 114% to 128% for the comparable twelve-month period ending 30 September 2020 and 2021, demonstrating the continued implementation of our strategy for additional sales and cross-selling and underlining the quality of the products and services we provide our customers
- Adjusted free cash flow * during the third quarter of 2021 increased by 144% to EUR 32.9 million, resulting in a consolidated cash flow conversion of 158%
- Cash amounted to EUR 768.4 million on 30 September 2021. The total liquidity available for use on 30 September 2021, including unutilized credit facilities, was EUR 878.4 million
- Total debt on 30 September 2021 was EUR 436.7 million, which resulted in a net cash of EUR 331.7 million
Segment information
RoW Betting
- Segment revenues during the third quarter of 2021 increased by 24% compared to the third quarter of 2020 to EUR 78.6 million. This growth was mainly driven by the uptake of our higher value-creating offerings, including Managed Betting Services and Live Odds Services, which increased by 63% and 20%, respectively, as a result of new customer gains and increased sales.2 and volume.
- Segment-adjusted EBITDA * during the third quarter of 2021 increased by 36% compared to the third quarter of 2020 to EUR 44.7 million. The The segment Adjusted EBITDA margin * improved from 52% to 57% during the third quarter of 2021, driven by growth in higher-margin products.
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2 Turnover is the total amount of bets placed and accepted in betting.
RoW AV
- Segment revenue increased during the third quarter of 2021 by 13% compared to the third quarter of 2020 to EUR 29.0 million. This growth was affected by COVID-related schedule changes in 2020, when more matches than usual were played in Q3 2020. Adjusted for schedule changes in Q3 2021, growth was about 30%, driven by volume growth because we could sell more matches (such as Football and baseball ) as well as growth from additional, new content (such as Copa America, Horse Racing and eSports) sold to existing and new customers.
- Segment-adjusted EBITDA * during the third quarter of 2021 increased by 220% compared to the third quarter of 2020 to 9.6 million euros. The The segment Adjusted EBITDA margin * improved from 12% to 33% during the third quarter of 2021, driven by lower costs for certain content.
United States
- Segment revenue during the third quarter of 2021 increased by 119% compared to the third quarter of 2020 to EUR 19.6 million. This result was driven by growth in our US betting services and increased revenue from our customers as the underlying market and sales grew. We also experienced a strong use of our advertising product, growth in US media and a positive impact from the acquisition of Synergy Sports during the second quarter of 2021.
- Segment-adjusted EBITDA * during the third quarter of 2021 increased by 24% compared to the third quarter of 2020 to – € (6.6) million. The The segment Adjusted EBITDA margin * improved from (-60%) to (-34%) during the third quarter of 2021, reflecting the scalability of this business and a clear path to profitability while continuing to invest in the US market.
Costs and expenses
- Personnel costs during the third quarter of 2021 increased by EUR 20.0 million compared to the third quarter of 2020 to EUR 51.3 million due to additional employment in new business areas (2,849 full-time positions third quarter 2021 compared to 2,235 full-time positions third quarter 2020), share-based compensation and reversal of temporary Covid 19 cost savings during the third quarter of 2021 compared to the third quarter of 2020.
- Other operating expenses during the third quarter of 2021 increased by EUR 15.7 million compared to the third quarter of 2020 to EUR 25.2 million, mainly driven by costs incurred for listing, compliance costs for operating as a listed company in the USA and M&A costs.
- Total costs for sports rights during the third quarter of 2021 decreased by EUR 9.0 million compared to the third quarter of 2020 to EUR 28.7 million due to fewer major sporting events during the third quarter of 2021 compared to the third quarter of 2020.
- Adjusted EBITDA * during the third quarter of 2021 was negatively affected by listing costs of EUR 5.7 million. Eliminating this impact would result in a Adjusted EBITDA * of EUR 26.6 million.
New business highlights
- Issued and sold 19 million shares in connection with the closing of our IPO on Nasdaq, which brought in EUR 546 million of primary net income
- Signed privacy partnerships with leading sports leagues and federations such as the Tamil Nadu Premier League (TNPL), Badminton Europe and the Austrian Tennis Federation
- Secured a multi-year exclusive agreement on official data and media rights with the Ligue Nationale de Basket (LNB), France’s highest basketball team
- Implemented complete Computer Vision models for Grand Slam tennis events including Wimbledon and the US Open
- Combined newly developed AI tools with our Managed Trading Services, Sports Radar’s holistic trading service for sportsbook operators, to more accurately discover potential game-related match-fixing
- Announced extension of partnership with US market leader FanDuel Group until 2028
- Announced a five-year agreement with US betting and iGaming operator Bally’s Interactive to help support and grow US sportsbook operations
- Celebrated three wins at the EGR B2B Awards in the categories Best Customer Service and Live Streaming Supplier, and the recently acquired Fresh Eight was nominated for best marketing and PR provider
Financial outlook
For the full year 2021, the company currently expects:
- Revenues in the range of EUR 553 million to EUR 555 million, corresponding to a growth of 36.6% to 37.1% for the financial year 2021
- Adjusted EBITDA * in the range of EUR 99.5 million to EUR 101.5 million, corresponding to a growth of 29.4% to 32.0% for the financial year 2021
Conference call and webcast information
Sports Radar will host a conference call to discuss the third quarter 2021 financial results on November 17, 2021 at. 8:00 Eastern Time (“ET”). The conference call can be reached live by phone by calling 1-877-423-9813, or for international calls 1-201-689-8573. A replay will be available from 11:00 AM ET on November 17, 2021 through November 24, 2021, by calling 1-844-512-2921 or for international calls 1-412-317-6671. The replay password will be 13724560.