Last July, the leading digital sports media group with top sports media brands and esports coverage Better Collective announced it finished the acquisition of South Florida-based sports and entertainment media platform Playmaker HQ as a means of boosting its social media and sports content.
Now, the Denmark-based company founded in 2004 has issued its second quarter reports, boasting good performance while also revealing a lower acquisition price for Playmaker HQ following fresh negotiations.
The decision regarding the acquisition price is aligned with the asset’s poor performance.
Reports of Growth All-Around
The company reported €99 million ($110 million) in revenue in Q2, marking a 27% year-on-year revenue rise from Q2 2023.
Organic sources also contributed to the growth by 5%.
Recurring revenue reached €62 million, signaling a 26% year-on-year growth from last year’s numbers. The figure accounted for most of the total group revenue at around 62%, driven by positive developments in the company’s revenue share income, a better-than-expected sports win margin, and the integration of acquisitions that stimulated recurring revenue from advertising.
Better Collective also reported a stable EBITDA for the same quarter at €29 million ($32 million), with a margin of 29%, in perfect alignment with the company’s projections and as a result of fresh recent acquisitions including Playmaker Capital and Playmaker HQ.
The company also made its increased investments in adtech and Artificial Intelligence competencies public, with special emphasis on AdVantage, along with the acquisition of 501,000 new depositing customers heavily influenced by the UEFA Euro 2024.
Q2 in a Time of Changing Market Conditions
Co-founder and chief executive officer Jesper Søgaard praised the “great team effort” for its contribution toward delivering “a strong Q2 in a time of changing market conditions.”
The CEO explained their business was “back to organic growth” while their “diversified strategy has performed as envisioned” following Q1 2024’s 13% year-on-year drop in EBITDA and 6% decrease in organic revenue growth.
Optimistic About Playmaker HQ’s Long-Term Potential
Opposite to the integration of the recently acquired AceOdds in Q2 which outperformed original expectations, Playmaker HQ’s underperformance triggered the need to reassess the initial terms of its acquisition (up to $54 million including $15 million upfront cash).
After renegotiations, the final price was dropped to $23 million.
The adjustment had a negative impact of €2.4 million ($2.67 million) on special items, mainly as a result of a goodwill write-down and the recognition of the remaining earn-out as income.
The company is still optimistic regarding Playmaker HQ’s potential in the long run, in the context of the company’s fresh changes to the commercial team.
Better Collective believes Playmaker HQ’s performance will improve during the second half of the year. The timeline for the new goals has been expanded by roughly 12 months.
At the end of June, Better Collective announced a share buy-back program valued at up to $21.48 million running from June 24 to September 5.
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