Better Collective Reports 8% Revenue Decline in North America for Q1 2024

Cost Analysis and Profitability Metrics

The costs in North America for Q1 2024 increased by 10%, reaching €24,902,000 from €22,600,000 in Q1 2023. For the full year 2023, the total cost stood at €77,703,000.

This rise in costs indicates substantial investments in operational capabilities and market expansion.

EBITDA for Q1 2024 was €9,103,000, a 37% decrease from €14,543,000 in Q1 2023. For the entire year 2023, EBITDA amounted to €30,897,000. The EBITDA margin before special items dropped to 27% in Q1 2024 from 39% in Q1 2023, with the annual margin for 2023 being 28%.

Operating profit before depreciation and amortization in Q1 2024 was €7,313,000, which is 50% lower than the €14,543,000 reported in Q1 2023. The total for 2023 was €30,009,000. The EBITDA margin stood at 29% in Q1 2024, compared to 39% in Q1 2023, with the annual margin for 2023 being 28%.

The organic revenue growth in Q1 2024 was 12%, which is an improvement compared to the 15% in Q1 2023. The overall organic growth for 2023 was 5%, showcasing a progressive enhancement in market penetration and consumer engagement.

Strategic Developments in North America

Better Collective successfully capitalized on the launch of sports betting in North Carolina and major events such as the Super Bowl, which bolstered the company’s commercial position despite a decline in revenue. This success is part of a broader, strategic transition from upfront CPA-based contracts to recurring revenue share models, a move aimed at achieving long-term sustainable growth. While this transition temporarily dampens revenue and earnings, it is designed to position Better Collective for future stability and profitability.

Additionally, the North American market saw an increase in new depositing customers compared to the previous year, a critical factor for future revenue generation under the new revenue share model. The integration of Playmaker HQ has further enhanced Better Collective’s product offerings and reach within the North American audience. This acquisition has allowed the company to host some of the top sports podcasts in the US, including Shaquille O’Neal’s “Big Podcast” show and “Roommates” featuring New York Knicks stars Jalen Brunson and Josh Hart.

Jesper Søgaard Co-founder & CEO of Better Collective highlighted the influence of the Playmaker HQ on the entire company: “Last year, we made public our intention to acquire the sports media group, Playmaker Capital, and successfully closed the acquisition early this year. Having only taken over the company in February, we are already observing positive trends. The cultural fit between our organizations is excellent and we see great opportunities to share knowledge across the teams. Overall, the integration of Playmaker Capital has progressed as planned and we have already observed encouraging early performance marketing results during the quarter stemming from affiliation revenue.”

Moreover, Better Collective’s move to high-level media partnerships has enriched its portfolio. The company’s shows and podcasts have consistently attracted renowned celebrities and star athletes, further amplifying its presence and engagement in the North American market.

Overall Financial Results for Better Collective Group

In the first quarter of 2024, Better Collective achieved a total revenue of €95.03 million, reflecting an 8% increase from €87.95 million in the same period the previous year. For the entire year of 2023, the company’s total revenue amounted to €326.69 million. Recurring revenue for Q1 2024 was €53.29 million, representing a 14% increase from €46.82 million in Q1 2023. Recurring revenue now constitutes 56% of the company’s total group revenue.

Source: Better Collective Interim Report Q1, 2024

Despite these gains, organic revenue growth experienced a decline of 6% in the first quarter of 2024, a notable decrease compared to the 23% growth observed in Q1 2023. For the full year of 2023, organic growth was recorded at 13%.

Total costs for Q1 2024 were €66.02 million, up 21% from €54.67 million in Q1 2023. Over the year 2023, total costs were €215.61 million. EBITDA before special items for Q1 2024 stood at €29.01 million, down 13% from €33.28 million in Q1 2023. For the entire year of 2023, EBITDA before special items was €111.08 million. The EBITDA margin before special items decreased to 31% in Q1 2024 from 38% in Q1 2023, with the annual margin for 2023 being 34%.

Profit before tax for Q1 2024 was €10.26 million, a significant decrease from €27.35 million in Q1 2023. For the full year of 2023, profit before tax was €58.01 million. As of March 31, 2024, Better Collective’s total assets were €1,153.66 million, up from €802.97 million on March 31, 2023. For 2023, total assets amounted to €937.86 million, reflecting the company’s strengthened financial position and increased asset base.

“In Q1, we saw good performance across all markets. Europe & ROW showed outstanding performance with an impressive 20% growth of which 5% was organic. This achievement was fueled by a widespread impact across markets, facilitated by our owned and operated channels alongside strategic media partnerships. In anticipation of the European Championships and Copa America, preparations are already in action, including concept developments and brand strategies tailored to maximize our impact,” added Søgaard.