Sportradar Group Ag Class A ((SRAD)) has held its Q4 earnings call. Read on for the main highlights of the call.
Sportradar Group AG’s recent earnings call painted a picture of robust financial health and strategic growth, despite some financial setbacks. The company reported significant revenue and EBITDA growth for 2024, driven by strategic acquisitions and successful market expansions. However, the call also highlighted a net loss in Q4 due to currency fluctuations, which tempered the overall positive sentiment.
Record Revenue Growth
Sportradar achieved a remarkable total company revenue of €1.1 billion for the full year 2024, marking a 26% increase compared to the previous year. This growth was particularly pronounced in the U.S. market, where revenue surged by 58%, underscoring the company’s strong market expansion efforts.
Significant Margin Expansion
The company reported an adjusted EBITDA of €222 million for 2024, reflecting a 33% increase from 2023. This growth was accompanied by a margin expansion of over 100 basis points, reaching 20%, highlighting Sportradar’s effective cost management and operational efficiency.
Successful Acquisition Announcement
Sportradar announced the acquisition of IMG ARENA, a strategic move expected to be immediately accretive to the business and its margins. This acquisition significantly enhances Sportradar’s sports rights portfolio, positioning the company for further growth.
Major League Baseball Partnership
In a significant development, Sportradar secured an exclusive deal with Major League Baseball through 2032. This partnership is expected to enhance Sportradar’s sports rights portfolio and contribute positively to business margins.
Expansion in Brazil
Sportradar expanded its footprint in Brazil by opening an office in São Paulo and signing 35 new sportsbook clients for its Managed Trading Services (MTS). This move indicates strong market penetration and growth potential in the region.
Net Loss in Q4
Despite strong annual performance, Sportradar reported a net loss of €1 million in the fourth quarter, a stark contrast to the €23 million net profit in the same quarter of the previous year. This loss was primarily attributed to currency fluctuations.
Unrealized Currency Losses
The company faced a €65 million change in unrealized currency losses, mainly linked to U.S. dollar-denominated sports rights. This financial setback highlights the challenges posed by currency volatility.
Forward-Looking Guidance
Looking ahead, Sportradar provided optimistic guidance for 2025, forecasting total company revenue to reach at least €1.273 billion, a year-over-year growth of at least 15%. The expected adjusted EBITDA for 2025 is €281 million, representing a 26% increase, with an anticipated margin expansion of at least 200 basis points. The company also aims to enhance free cash flow conversion beyond the 53% achieved in 2024, with the acquisition of IMG ARENA projected to be immediately accretive to revenue, adjusted EBITDA, and free cash flow.
In summary, Sportradar Group AG’s earnings call reflected a strong financial performance in 2024, driven by strategic growth initiatives and market expansions. Despite facing some financial challenges, the company’s forward-looking guidance suggests continued growth and profitability in 2025, positioning Sportradar as a key player in the sports data and technology industry.