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Sportradar Reports Strong Second Quarter 2023

Published

9 months ago

August 9, 2023

Alan Campbell

Reading Time: 5 minutes

Delivered 23% revenue, 42% Adjusted EBITDA growth for first six months

On track to deliver record annual revenue

Annual outlook reaffirmed with growth of 24% to 26% for revenue and 25% to 33% for Adjusted EBITDA

Sportradar Group AG (NASDAQ: SRAD), a leading global sports technology company focused on creating immersive experiences for sports fans and bettors, today announced financial results for its second quarter ended June 30, 2023.

“We are very proud of our strong performance during the first half of 2023 and remain on track to achieve the highest annual revenue in the company’s history,” the Chief Executive Officer for Sportradar, Carsten Koerl, said. “We hold a pivotal position in the global sports ecosystem and believe our talent, technology and diverse product offering positions us for strong future growth as we continue to execute against our strategic initiatives.”

Second Quarter 2023 Financial Highlights

Revenue in the second quarter of 2023 increased 22% to €216.4 million compared with the second quarter of 2022 with growth across all segments.
The company’s customer net retention ratio (NRR) remained at 120% in the second quarter of 2023 compared with the first quarter of 2023, demonstrating the company’s strength in cross selling and upselling to its clients.
Total profit from continuing operations, which included an €8 million one-time loss on disposal of an equity investment, decreased €22.8 million compared with the same quarter last year. The primary driver for the decrease was a net negative impact from foreign exchange rates. The company’s adjusted EBITDA1 for the same period increased 46% to €40.1 million compared with the second quarter of 2022, primarily due to strong revenue growth and higher operating leverage.
Total profit from continuing operations as a percentage of revenue for the second quarter of 2023 was 0% compared with 13% for the same quarter last year. Adjusted EBITDA margin1 was 19% in the second quarter of 2023, an increase of almost 300 bps compared with 16% in the prior year period.
As of June 30, 2023, Sportradar had total liquidity of €484 million including cash and cash equivalents of €264 million and an undrawn credit facility of €220 million.

Key Financial Metrics
	Q2	Q2	Change
In millions, in Euros €	2023	2022	%
Revenue	216.4	177.2	22%
Profit for the period from continuing operations	0.03	22.8	(100%)
Profit for the period from continuing operations as a percentage of revenue	0%	13%	–
Adjusted EBITDA¹	40.1	27.6	46%
Adjusted EBITDA margin¹	19%	16%	–
Net Retention Rate¹	120%	118%	–

_________________________

1 Non-IFRS financial measure; see “Non-IFRS Financial Measures and Operating Metrics” and accompanying tables for further explanations and reconciliations of non-IFRS measures to IFRS measures.

Recent Company Highlights

Sportradar continued to deepen its relationships with United States operators including an expansion of its long-standing agreement with Caesars Entertainment, establishing the company as the official supplier of betting data from leagues including the NBA, MLB and NHL. The company’s recent signings demonstrate its commitment to delivering engaging experiences for its clients while effectively monetizing its league partnerships through the value-added creation of innovative products and solutions.

Sportradar was selected as the exclusive global betting partner by CONMEBOL, the governing body of ten national soccer associations in South America, to enhance the accessibility and engagement of South American football for a broader global audience.
Sportradar was appointed as the official technology partner by the Delhi Capitals. The new three-year partnership will provide innovative video technology to develop cricket talent. Sportradar continues to build relationships in emerging markets such as India with strong sports fan bases.
Sportradar organized its inaugural Elite Prep Basketball Tournament, the Sportradar Showdown, held in Las Vegas in July. The tournament brought together exceptional amateur basketball teams under the Under Amour Association, Adidas 3SSB and NBA Academy and showcased Sportradar’s Synergy technology, capturing extensive data throughout the tournament and offering valuable insights for the use of college coaches and NBA talent scouts.
The company won multiple awards in the second quarter. Sportradar was named Acquisition and Retention Partner of the Year by EGR North America, won the Live Betting and Gaming Product Award and the Sports Data Product Award from SBC North America, received the Live Streaming Supplier Award at the EGR B2B Awards and ORAKO Sportsbook solution was selected as Best Sports Betting Technology of the Year at the 2023 Sports Technology Awards.

Segment Information

RoW Betting

Segment revenue in the second quarter of 2023 increased by 20% to €114.1 million compared with the second quarter of 2022. This growth was driven primarily by increased sales of the company’s higher value-add offerings including MBS, which increased 25% to €41.1 million, as well as Live Odd and Live Data products that grew 19% year over year.

Segment Adjusted EBITDA1 in the second quarter of 2023 increased by 18% to €51 million compared with the second quarter of 2022. Segment adjusted EBITDA margin1 remained at 45% year over year.

RoW Audiovisual (AV)

Segment revenue in the second quarter of 2023 increased by 25% to €49.6 million compared with the second quarter of 2022. Revenue growth was driven by the new CONMEBOL deal and growth in sales to new and existing customers.

Segment adjusted EBITDA1 in the second quarter of 2023 increased 26% to €16.4 million compared with the second quarter of 2022. Segment adjusted EBITDA margin1 remained at 33% year over year.

United States

Segment revenue in the second quarter of 2023 increased by 31% to €38 million compared with the second quarter of 2022. Results were primarily driven by growth of 105% collectively in betting and gaming and audiovisual products.

Segment adjusted EBITDA1 in the second quarter of 2023 was €5.4 million compared with a loss of (€5.5) million in the second quarter of 2022, indicating the strong improvement in operational leverage in the United States business model despite continuous investment. Segment adjusted EBITDA margin1 improved to 14% from (19%), compared with the second quarter of 2022.

1 Non-IFRS financial measure; see “Non-IFRS Financial Measures and Operating Metrics” and accompanying tables for further explanations and reconciliations of non-IFRS measures to IFRS measures.

The tables below show the information related to each reportable segment for the three- and six-month periods ended June 30, 2022 and 2023.

	Three Months Ended June 30, 2022
in €’000	RoW Betting		RoW Betting AV		United States		Total reportable segments		All other segments		Total
Segment revenue	95,513		39,741		29,066		164,320		12,869		177,189
Segment Adjusted EBITDA	43,324		13,053		(5,498	)	50,879		(4,899	)	45,980
Unallocated corporate expenses⁽¹⁾											(18,427	)
Adjusted EBITDA¹											27,553
Adjusted EBITDA margin¹	45	%	33	%	(19	%)	31	%	(38	%)	16	%

	Three Months Ended June 30, 2023
in €’000	RoW Betting		RoW Betting AV		United States		Total reportable segments		All other segments		Total
Segment revenue	114,149		49,569		37,959		201,677		14,757		216,434
Segment Adjusted EBITDA	51,041		16,418		5,441		72,900		(2,560	)	70,340
Unallocated corporate expenses⁽¹⁾											(30,238	)
Adjusted EBITDA¹											40,102
Adjusted EBITDA margin¹	45	%	33	%	14	%	36	%	(17	%)	19	%

	Six Months Ended June 30, 2022
in €’000	RoW Betting		RoW Betting AV		United States		Total reportable segments		All other segments		Total
Segment revenue	182,250		85,664		54,733		322,647		22,418		345,065
Segment Adjusted EBITDA	87,942		21,987		(11,920	)	98,009		(8,613	)	89,396
Unallocated corporate expenses⁽¹⁾											(35,142	)
Adjusted EBITDA¹											54,254
Adjusted EBITDA margin¹	48	%	26	%	(22	%)	30	%	(38	%)	16	%

	Six Months Ended June 30, 2023
in €’000	RoW Betting		RoW Betting AV		United States		Total reportable segments		All other segments		Total
Segment revenue	222,649		94,123		77,696		394,468		29,530		423,998
Segment Adjusted EBITDA	98,429		27,759		12,265		138,453		(5,707	)	132,746
Unallocated corporate expenses⁽¹⁾											(55,973	)
Adjusted EBITDA¹											76,773
Adjusted EBITDA margin¹	44	%	29	%	16	%	35	%	(19	%)	18	%

_________________________

Annual Financial Outlook

Sportradar reaffirmed its annual outlook range provided on March 15, 2023, for revenue and adjusted EBITDA1 for fiscal 2023 as follows:

Revenue in the range of €902.0 million to €920.0 million, representing growth of 24% to 26% over fiscal 2022.
Adjusted EBITDA1 in a range of €157.0 million to €167.0 million, representing 25% to 33% growth versus last year.
Adjusted EBITDA margin1 in the range of 17% to 18%.

Conference Call and Webcast Information

Sportradar will host a conference call to discuss the second quarter 2023 results today, August 9, 2023, at 8:00am Eastern Time. Those wishing to participate via webcast should access the earnings call through Sportradar’s Investor Relations website. An archived webcast with the accompanying slides will be available at the company’s Investor Relations website for one year after the conclusion of the live event.

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