Sportradar Group AG, a world-leading technology platform enabling the next generation to engage in sport, and the number one provider of business-to-business solutions for the global sports betting industry, announced financial results for its third quarter ended in September 30, 2021.
Sportradar Highlights for the Third Quarter of 2021:
- Revenue in the third quarter of 2021 increased 30% compared to the third quarter of 2020 to 136.8 million euros (US$158.7 million), driven by robust growth across all geographies and business segments;
- Strong performance in the US market continued, with US revenue in the third quarter of 2021 increasing 119% compared to the third quarter of 2020. For the nine months ended September 30, 2021, US revenue reached 48.5 million euros ($56.3 million);
- Adjusted EBITDA for the third quarter of 2021 increased 21% compared to the third quarter of 2020 to 20.9 million euros ($24.2 million);
- Strong dollar-based Net Retention Rate of 128% at the end of the third quarter of 2021, underscoring the continued success of the cross-sell and upsell strategy;
- Successfully extend partnership to 2028 with FanDuel Group, leader in the US sportsbook market, covering pre-match betting services, live betting services and entertainment betting tools;
- Successful completion of Nasdaq listing, raising €546 million of primary net income to fund continued business growth, providing the company €878 million to continue investing in global growth;
- For the full year 2021, revenue is expected to be in the range of 553 to 5555 million euros ($641 to $644) and adjusted EBITDA in the range of 99.5 to 101.5 euros (US$ 115.4 to US$ 117.7)1 million.
Carsten Koerl, CEO of Sportradar, said: “Our strong results demonstrate the value we deliver to our partners and customers around the world. We are the world’s largest sports intelligence provider and the only profitable global sports technology platform of scale.” .
“Critically, we believe that we are also the most innovative in developing technology solutions that allow our league customers, media and betting partners to use our growing data to attract and engage sports fans.”
Koerl continued: “We plan to continue making significant investments, particularly in the US. The US represents the key area for executing our strategic growth plans.”
“The US region is currently just 7% of our group’s revenue, representing a significant potential business opportunity as more states legalize gambling and the market expands from $1 billion in 2019 to an estimated $23 billion in the next 10 years”.
“Sportradar’s recent Nasdaq listing in the United States was a tremendous milestone for our team, and we look forward to building on our success in a multitude of areas in the coming years.”
Financial highlights for the three months ended September 30, 2021:
- Revenue in the third quarter of 2021 increased 30% compared to the third quarter of 2020 to 136.8 million euros;
- Adjusted EBITDA in the third quarter of 2021 increased 21% compared to the third quarter of 2020, to 20.9 million euros;
- Adjusted EBITDA margin remains strong at 15% in Q3 2021, a slight decrease from Q3 2020 due to additional IPO costs of approximately €5.7 million that were incurred in Q3 2021;
- Eliminating the impact of IPO costs would result in an Adjusted EBITDA margin of 20%, illustrating the continued ability to achieve operating leverage;
- The dollar-based net retention rate increased from 114% to 128% for the comparable 12-month period ending September 30, 2020 and 2021, demonstrating the continued execution of the upsell and cross-sell strategy and underscoring the quality of products and services provided to customers;
- Adjusted free cash flow for the third quarter of 2021 increased 144% to 32.9 million euros, which resulted in a group cash flow conversion of 158%;
- As of September 30, 2021, the cash value totaled €768.4 million. The total liquidity available for use as of September 30, 2021, including unused credit lines, was €878.4 million;
- Total debt as of September 30, 2021 was 436.7 million euros, resulting in a net cash position of 331.7 million euros.
Sportradar segment information
Sportardar’s Betting Department:
- Segment revenue in the third quarter of 2021 increased by 24% compared to the third quarter of 2020 to 78.6 million euros; This growth was mainly driven by the acceptance of higher value-added offers, including Managed Betting Services and Live Odds Services, which increased by 63% and 20% respectively, as a result of new customer acquisition as well as volume increase turnover2 and sales volume;
- Adjusted EBITDA by segment in the third quarter of 2021 increased by 36% compared to the third quarter of 2020 to 44.7 million euros. Segment Adjusted EBITDA margin improved from 52% to 57% in the third quarter of 2021, driven by growth in higher margin products.
Costs and expenses:
- Personnel expenses in the third quarter of 2021 increased by 20 million euros compared to the third quarter of 2020, to 51.3 million euros resulting from additional hires in new business lines (2,849 FTE in the third quarter of 2021 against 2,235 FTE Q3 2020), share-based compensation and reversal of COVID 19 temporary cost savings in Q3 2021 compared to Q3 2020;
- Other operating expenses in the third quarter of 2021 increased by 15.7 million euros compared to the third quarter of 2020 to 25.2 million euros, mainly due to costs incurred with IPO, compliance costs related to operating as a public company in the US and M&A costs;
- The total costs of sports rights in the third quarter of 2021 decreased by 9 million euros compared to the third quarter of 2020, to 28.7 million euros resulting from fewer major sporting events in the third quarter of 2021 compared to the third quarter of 2020 ;
- Adjusted EBITDA in the third quarter of 2021 was negatively affected by IPO costs of 5.7 million euros. The elimination of this impact would result in an adjusted EBITDA of 26.6 million euros.
Recent highlights of Sportradar’s businesses:
- Sale of 19 million shares in connection with the closing of the Nasdaq IPO raising €546 million of primary net income;
- Integrity partnerships with major sports leagues and federations such as the Tamil Nadu Premier League (TNPL), Badminton Europe and the Austrian Tennis Association;
- Exclusive official multi-year agreement with the Ligue Nationale de Basket (LNB), France’s premier basketball league. Implementation of complete Computer Vision models for Grand Slam tennis events, including Wimbledon and US open;
- Newly developed AI tools combined with Managed Commerce Services, Sportradar’s holistic commerce service for sports wallet operators, to more accurately detect potential bets related to the correction of matches;
- Announced extension of partnership with North American market leader FanDuel Group until 2028;
- Five-year agreement with American betting and iGaming operator, Bally’s Interactive, to help support and grow US sports betting operations
- Three EGR B2B Awards wins in the Best Customer Service and Live Streaming Provider categories, as well as the newly acquired Fresh Eight being short-listed for Best Marketing and PR Provider;
