24 Aug: Better Collective sets $100m US revenue target for 2022
Better Collective Q2, MGM Resorts analyst note, Elys Games investor call +More
Good morning. The second-quarter earnings season is now winding down but not before the major listed affiliates have their say about how their businesses have been performing. Tomorrow will feature the latest figures from Catena Media and later in the week there will be the debut quarterly results from the newly-listed Gambling.com but first comes another set of record results from Better Collective.
If you have been forwarded this newsletter and would like to subscribe, click here:
Better Collective Q2
The top line
Revenue hit €40m ($46.9m), up 162% YoY on a Covid-hit prior-year period and up 3% sequentially. EBITDA before special items rose 89.6% YoY to €12.7m but was down 3.8% QoQ.
Publishing accounted for €26.1m of revenues (up 79% YoY) and paid media stood at €13.9m, with organic growth rate of 13%.
Trading in July was softer with organic growth of 13% partly due to tighter sports margins.
Action reaction: Better Collective broke out its US revenues for the first time, showing revenues of €6.95m in Q2, up 429% YoY and now contributing 19% of total revenues. This includes one month of revenues from the Action Network acquisition which contributed €1.8m of revenue and neutral EBITDA. CEO Jesper Søgaard was keen to say there would be more to come from what in his view was “the no.1 asset in the US sports-betting industry” and helping BC’s transition towards becoming a “broad-based media group.”
When I said I loved you: Søgaard said its media partnerships, including the previously announced deals with the Daily Telegraph in the UK and nj.com, as well as with three unnamed partners, had achieved a “breakthrough” in Q2, having previously established the proof of concept. The media deals delivered over 38,000 NDCs over the quarter out of a total of 179,000 and Søgaard noted that the nj.com deal in particular was helping answer the issue of affiliate revenue growth in the more mature US states. “There are no signs that we should view the early states as mature states,” he added.
Old world, new problems: RoW markets still contributed the majority of revenues (€12.7m, up 222% YoY), but in step with its European online gaming and betting partners, it is suffering from regulatory actions in Sweden, Spain and the UK where in the paid media segment, Søgaard said customers had lowered spend due to regulatory pressures. Meanwhile, in Germany the new rules regarding affiliates not being able to earn from revenue share is leading to a shift to CPA.
“It’s important to understand there is a big change in the way we can monetise,” said Søgaard. “We are still discussing how to build partnerships more tied to performance. But from a traffic perspective, the numbers are still strong with strong rankings.”
MGM Resorts International analyst note
Pass the port: Following a dinner with MGM Resorts International’s CFO Jonathan Halkyard, analysts at Macquarie suggested the simplification of MGMs’ asset-light story following the MGM Springfield and CityCenter transactions (as well as the clarification from the VICI-MGM Growth Properties buyout) has left the company with over $11bn in free cash to “pursue growth” either digitally or in Japan. The Macquarie team reiterated its belief that MGM can “accretively acquire” BetMGM JV partner Entain at a 30% premium. “However, there are other tech options to explore its non-US strategy,” they added.
Elys Game technology earnings call
The long haul: Over the course of a near two-hour call with investors (no, we didn’t remain logged in for the whole time), Elys gave some color to its results statement from last week. Recall, the company said revenue rose 143% to $11.7m while net losses increased 32.1% to $2.7m. Chairman Mike Ciavarella set the scene by suggesting the welding of an Italian-facing B2C operation to a US-facing B2B arm (augmented by the acquisition of US Bookmaking) was on track. “Many of our competitors could service large operators but we have demonstrated we can service the small operators,” he said. “We can scale the platform down to the level of a single restaurant/bar.” Ciavarella also suggested Elys had tribal operators in its sights.
Newslines
Sports cohorts: Genius Sports has hooked up with sports entrepreneurial accelerator Stadia Ventures to be ‘Cohort Partner’ for Fall 2021. It will involve Genius joining a wide variety of companies pitching in their two cents’ worth across ecommerce, sports franchises, major leagues, media and broadcasting, gaming and esports. Among the betting and gaming sector representatives are the venture capital arm of DraftKings, Drive by DraftKings, PointsBet as well as Genius’s rival Sportsradar.
Sideways on: Scientific Games has given its soon-to-be-disposed-of lottery unit a boost by adding the Sideplay Entertainment e-instant business to its portfolio of assets. SciGames hopes the acquisition will enhance the global lottery unit’s share of the digital market. Up and running since 2003, Sideplay has launched more than 270 instant win games for leading lottery and gambling operators around the world. No further details about the transaction were divulged.
Not so sweet Carolina: The North Carolina Senate has approved a bill to expand sports betting and regulate online and mobile betting. The Senate voted 26-19 to approve bill SB 688, it will now go to the House of Representatives, but is expected to be keenly debated abd passage is far from certain. Rep. Pricey Harrison told local media there was “healthy bipartisan opposed to gambling (and) I don’t see how the bill moves through the House this year. It’s a big change and it needs thorough vetting and deliberation.”
Sing when you’re Wynning: Wynn Resorts is integrating its Wynn Rewards program into its online platforms to enable players to redeem points online or throughout the group’s hotels and resorts. Wynn Interactive CEO Craig Billings said the program will “reward early WynnBET players with tier upgrades based on historical play.”
Fiesta time: Caesars Entertainment has partnered with the Fiesta Bowl to produce a sports betting and fantasy gaming partnership for college football Bowl games. The aim is to encourage fan engagement and expand sports gaming and education in Arizona. Regulated sports-betting is set to go live on 9 September in Arizona (See below) and Caesars will be headline sponsor and host in-stadia fan lounges during PlayStation Fiesta Bowl and Guaranteed Rate Bowl games.
Notch another state for FanDuel and Barstool: Staying with Arizona, SportsHandle is reporting that FanDuel and Penn National are the first operators to receive licenses for sports-betitng. FanDuel has also received DFS licensing and will launch this week.
Paysafe expands DACH operations: Paysafe has acquired viafintech, a “bank independent” payment specialist focused on the DACH region, for an undisclosed amount. The deal was carried out through an all-cash transaction, with viafintech integrated into its Paysafe eCash division focusing on prepaid and online cash solutions. The deal enables Paysafe to strengthen its operations in the key German and neighbouring markets. It also “creates revenue-generating opportunities to cross-sell viafintech’s alternative banking and payments solutions” to merchants in other regions such as Latin America, where Paysafe recently acquired PagoEfectivo and SafetyPay.
Simplicity: Former MGM Resorts International CEO Jim Murren has joined the board of directors of the sports micro-betting start up Simplebet. Murren took part in a recent $15m funding round in the company and joins Pat Ramsey, a non-executive director at Aristocrat Games, on the Simplebet board.
What we’re reading
The end of the roadshow: Welcome to the world of the multi-million dollar video investor presentation.
Where’s you head at: How head fakes are throwing bookmakers into tailspins.
On social
I do like to bet beside the seaside: Why the record-breaking wagering at Del Mar on Saturday proves that racing can be stronger together.
Calendar
25 Aug: Catena Media Q2
26 Aug: Gambling.com Q2
27 Aug: Weekend Edition
Contact us
Scott Longley scott@clearconcisemedia.com
Jake Pollard jake@openmediaservices.com