Better Collective (BETCO) Q4 2024 earnings summary

Executive summary

• 2024 was marked by significant external headwinds, including regulatory changes in Brazil and a Google policy update, leading to a challenging environment after a strong start to the year.

• Despite these challenges, the company delivered solid growth in Europe, Canada, and eSports, while the U.S. market saw flat growth.

• Recurring revenue reached record levels, highlighting improved revenue quality and business resilience.

• A cost-efficiency program was implemented, resulting in improved financial discipline and positioning for future growth.

• Strategic focus has shifted to organic growth, safeguarding cash flow, and maintaining financial agility.

Financial highlights

• Full-year 2024 revenue was 371.5 mEUR, up 14%, with recurring revenue up 21% to 230.7 mEUR, and EBITDA before special items up 2% to 113.4 mEUR (31% margin).

• Q4 2024 revenue reached 96.2 mEUR (+13%), recurring revenue 63.1 mEUR (+28%), EBITDA before special items 33.5 mEUR (+14%), EBITDA margin 35%.

• Delivered 1.8 million new depositing customers (NDCs) in 2024, with 81% on revenue share agreements.

• Cash flow from operations before special items was 82.6 mEUR for 2024, with a cash conversion rate of 86%.

• Net profit for 2024 was 34.0 mEUR (2023: 39.8 mEUR), EPS 0.55 EUR (2023: 0.74 EUR).

Outlook and guidance

• 2025 revenue guidance: 320–350 mEUR, EBITDA before special items: 100–120 mEUR, free cash flow: 55–75 mEUR, net debt/EBITDA below 3x.

• Short-term revenue and EBITDA will be impacted by Brazilian regulation, with an estimated 35–50 mEUR negative effect on 2025 EBITDA.

• Organic growth expected to return from 2026, with a long-term EBITDA margin target of 35%-40% by 2027.

• Free cash flow guidance for 2025 includes interest, tax, and intangible payments, but excludes debt and earn-outs.

• Net debt-to-EBITDA to remain below 3x.