Sportradar ‘seeing the results’ of early US investment in 2021

Sportradar has published its Q4 and FY2021 results, announcing a 39% YoY increase in yearly revenue thanks to strong growth across all business segments.
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Sportradar Group AG has published its fourth quarter and full-year 2021 financial results, announcing a 39% year-over-year increase in yearly revenue thanks to strong growth across all business segments.

Most notably, CEO Carsten Koerl praised the company’s momentum in the United States, remarking it is ‘seeing the results’ of its early investment into the market.

Sportradar declared a Q4 revenue of $172.2m, a 41% improvement YoY (Q4 2020: $120.1m) driven by robust growth across all business segments. 

Meanwhile, the company’s FY2021 revenue came in at $634.2m, a 39% rise YoY (FY2020: $450.3m) thanks to strong growth across all business segments, exceeding the top end of the company’s 2021 annual outlook range of $615m to $617m.

Q4’s adjusted EBITDA rose by 14.0% YoY to $24.2m (Q4 2020: $20.9m), while the adjusted EBITDA margin was 14% (Q4 2020: 17%) due to increased investment in content and technology, higher costs related to being a public company, and higher M&A costs.   

Adjusted Free Cash Flow in Q4 decreased to a $25.0m loss, resulting in a cash flow conversion loss of 105.1%. 

Sportradar notes this loss is primarily due to “additional interest from the Company’s senior secured term loan facility originating in November 2020, timing of sports data licensing payments to leagues, IPO related payments as well as higher costs associated with being a public company”.

Adjusted EBITDA for the full year increased by 33% to $115.3m (FY2020: $85.5m). Excluding Sportradar’s September 2021 Initial Public Offering (IPO) costs, adjusted EBITDA was $128.5m.

The adjusted EBITDA margin for 2021 was 18% (FY2020: 19%). Excluding IPO costs, the adjusted EBITDA margin was 20%.

Strong Dollar-Based Net Retention Rate increased to 125% for FY2021 compared (FY2020: 113%). The company attributed this improvement to its “cross-sell and upsell strategy across its global customer base”.

As of December 31, 2021, cash and cash equivalents totaled $826.1m, while total liquidity available for use, including undrawn credit facilities, was $948.4m.  

CEO Carsten Koerl commented: “I am very pleased with our strong results, which illustrate how well we are delivering on our operational and growth plans. Importantly, we have good momentum going into our next fiscal year.

“We are continuing to invest in content, technology and people that will allow us to deliver profitable growth in line with our goals.”

In the United States, Q4 revenue rose by 92% YoY to $26.2m, driven by increased sales of US Betting services as the underlying market and turnover grew, as well as a strong adoption of its ad:s product, growth in US Media, and a positive impact from the acquisition of Synergy Sports. FY2021 revenue grew by 108% to $79.7m.

However, the segment’s adjusted EBITDA in Q4 decreased to an $8.45m loss due to increased investment in the company’s league and team solutions-focused business. The adjusted EBITDA margin for the segment decreased to a 33% loss too (Q4 2020: 11%).

FY2021 adjusted EBITDA in the US decreased as well by 38% to a $25.1m loss, while FY2021 adjusted EBITDA margin improved to a 32% loss, up from the 48% loss in the prior year.

In 2021, Sportradar entered or extended multi-year partnerships with the National Hockey League (NHL), the National Basketball Association (NBA), the Women’s National Basketball Association (WNBA), and the NBA G League.

In Q4, the company also extended its partnership with Kambi, announced a new deal with PointsBet, and made new hires including Andrew Bimson as North American Chief Operating Officer.

Koerl continued, “We are particularly pleased about more than doubling our year-over-year revenues in the United States, which continues its explosive sports betting growth story. 

“Sportradar has been a leader in this market since 2014, and we’re now seeing the results of our early investment. We continue to see the enormous opportunity as sports betting becomes an increasingly integral part of the media entertainment fabric in the US.”

Looking ahead, Sportradar expects its FY2022 revenue to be in the range of $752.0m to $791.0m, representing a growth of 18% to 25% over FY2021. Adjusted EBITDA is expected to be between $139.0m to $150.0m, a 21% to 30% rise over the previous year, while the adjusted EBITDA margin is expected to be in the range of 18.5% to 19.0%.