Sportradar released its financial report for the first quarter of 2022 and confirmed a 31% growth in revenue compared to the same period last year. This was especially reflected in the US segment, which grew 124% over the previous year. With this, the company’s prospects project annual revenue growth of 18-25%.
Revenue for the first quarter of 2022 reached $186.4 million compared to the same quarter last year. This was driven by growth across all segments, particularly the US segment, which increased to $28.5 million.
On the other hand, adjusted EDITBA for the first quarter of 2022 decreased 5% to $29.6 million compared to the same period last year. According to Sportradar, this is primarily due to the higher costs associated with public company status, as well as the reversal of certain temporary cost savings related to COVID-19 compared to 1Q 2021.
Adjusted EBITDA margin was 16% in the first quarter of this year, against a margin of 22% in the same period last year. Adjusted free cash flow from January 1 to March 31, 2022 increased by 100% to $13.6 million; Free cash flow conversion was 48% quarter-on-quarter.
The report also stated that the strong net retention rate, based on the last 12 months, increased to 121% at the end of the 2022 quarter, compared to 107% in the same period in 2021.
According to the company, this highlights the continued success of the company’s cross-selling and upselling strategy across its global customer base. Cash equivalents totaled US$754.3 million as of March 31 this year. Total liquidity available at the end of the quarter, including unused lines of credit, was US$870.4 million.
In addition, specific information was provided for each of the company’s segments. The other international markets outside the US saw revenue increase by 25% in the first quarter to $91.5 million.
This growth was driven by the increase in sales of the company’s higher value-added offers, such as:
- Managed Betting Services (MBS), up 51% to $27.8 million;
- Live Data Services/Betting Services, up 16% to $49.3 million.
The report also specifies that MBS’ growth was driven by increased turnover and the growth of live betting/data services as a result of content sales to existing customers. In addition, increased content sales following the acquisition of Synergy contributed to the growth.
In the international audiovisual segment, revenue increased in Q1 2022 by 17% to US$48.4 million compared to Q1 2021. This growth was primarily attributable to the increase in Tennis Australia and National Hockey League content ( NHL), as well as the sale of content from the Synergy acquisition.
Adjusted segment EBITDA for the first quarter of 2022 was stable at $9.3 million compared to the first quarter of 2021 and the margin decreased from 23% to 19% compared to the same period last year.
The growth of Sportradar in the United States
In the American segment, one of the most successful in the Sportradar report, the increase in revenue is due to increased sales of betting services in the US as a result of legalization in new states.
They also confirmed that they experienced sales growth for media companies and a positive impact with the acquisition of Synergy Sports. Adjusted EBITDA for this segment was USD 6.7 million in the first quarter of this year, up from EUR USD 3.7 million a year ago.
This is mainly attributed to increased investment in the league solutions business and the company’s team. The segment’s adjusted EBITDA margin improved from 32% to 25% compared to the first quarter of 2021, which for the company translates into better operating leverage in the US segment.
In terms of costs and expenses, personnel expenses in the first quarter of 2022 increased by $14.4 million to $55.1 million compared to the same period last year. According to the report, this was the result of additional hires in the company’s product and technology organizations, in both high- and low-cost locations.
The number of employees increased by 620 and reached 3,075 full-time hires at the end of the first three months of 2022.
Total sports rights costs in the first quarter of the year increased by US$13.8 million to US$56.9 million compared to the first quarter of 2021. This is mainly due to the new rights for the ICC, UEFA and ATP for this year. year and the normalization of the sports calendar with the NBA, NHL and MLB as pandemic restrictions eased.
Carsten Koerl, CEO of Sportradar referred to the report and stated that its 2022 fiscal year “is off to a fast start, with core and high-margin products driving growth worldwide.”
“Our US business continues its tremendous growth story as more states become legal and sports betting becomes live entertainment. As a market leader, our technology and data-driven insights continue to transform the convergence of media, entertainment and sports, and to drive our history of consistent and profitable long-term growth,” added Koerl.
Following the close of Q1 2022, Sportradar acquired AI solutions developer for the iGaming industry, Vaix. It also received registration as an online/mobile betting service provider in Ontario, Canada.
Additionally, in the US, the brand has appointed Michael Gandolfo as the Group’s Head of Regional Sales. The company has also entered into an agreement with Norwegian state gaming operator Norsk Tipping to deploy a Sportradar Internet betting (iSSBT) self-service terminal at 245 locations across the Scandinavian country.
It also continues its mission to detect, investigate and prevent match correction, doping and other threats to the integrity of the sport and has announced a multi-year integrity partnership with NASCAR to this end. In addition, he announced that he will serve as an advisor to the Bowl Season in the sports betting space in a responsible and educational approach.
