===== SIDA 1 ===== Interim report Q1 2023 Copenhagen, May 16, 2023 Better Collective A/S www.bettercollective.com CVR NO.: 27 65 29 13 Image from Better Collective’s Capital Markets Day. Watch the presentation here • Revenue: 88 mE UR, growth of 30% , organic growth of 23% • Recurring revenue: 41 mEUR, growth of 75% , 46% of Group revenues versus 35% Q1 last year • EBITDA before special items: 33 mEUR , growth of 44% • April trading update : Revenue of 27 mEUR; 40% growth ===== SIDA 2 ===== Q1 report 2023 Page 1 Revenue mEUR Q1 2023 EBITDA* mEUR Earnings per share Recurri ng revenue mEUR *Before special items ===== SIDA 3 ===== Q1 report 2023 Page 2 Highlights Q1 3 Financial highlights and key figures 4 CEO letter 5 Business review and financial performance 6 Financial performance first quarter 2023 10 Notes 20 Q1 report 2023 Page 2 Calendar 2023 • August 23, 2023 – Q2 report • November 15, 2023 – Q3 report • February 21, 2024 – Q4 report Table of contents A conference call for Better Collective’s stakeholders will be held on May 17, at 10:00 a.m. CET and can be joined online here. The presentation material for the webcast will be available after market close on May 16 via: www.Bettercollective.com To participate telephonically follow this link . Once signed up you will receive an e-mail with a phone number and a personal dial-in code for the call. Q1 webcast May 17, 2023 ===== SIDA 4 ===== Q1 report 2023 Page 3 Highlights Q1 Q1 Group revenue grew by 30% to 88 mEUR, which is another record quarter (Q1 2022: 67 mEUR ). Organic revenue growth was 23%. Recurring revenue was 41 mEUR, implying 75% growth. Equal to 46% of Group revenue versus 35% Q1 last year. Q1 Group EBITDA before special items was 33 mEUR, a growth of 44% (Q1 2022: 23 mEUR). The Group EBITDA- margin before special items was 38%. Cash flow from operations before special items was 33.4 mEUR (Q1 2022: 13.1 mEUR). The cash conversion was 100%. By the end of Q1, capital reserves stood at 91.6 mEUR of which cash of 28.1 mEUR, other current finan- cial assets of 17.1 mEUR and unused bank credit facilities of 45.6 mEUR. New Depositing Customers were 48 8K in the quarter implying growth of 35%. NDCs sent on revenue share contracts were 71%. On November 22, 2022, Better Collective initiated a share buyback program for up to 5 mEUR, which was completed on January 20, 2023. Better Collective acquired a position of >5% in Catena Media. In connection with the release of its annual report 2022, Better Collective announced new long -term financial targets for the period 2023-2027: • Revenue CAGR of +20% • EBITDA-margin before special items of 30-40% • Net debt to EBITDA below 3 • The targets assume M&A solely financed by own cash flow and debt The Group signed its first global media partnership with the digital soccer platform Goal, while also signing with the well-established Polish news portal Wirtualna Pol- ska. Better Collective also established a media partner- ship with Nigeria’s leading news media, PUNCH, and in doing so entered a new continent with a growing popu- lation of sports enthusiasts. Ohio launched online sports betting, which from a regu- latory perspective was a perfect state launch. The state of Massachusetts regulated online sports betting. With a population of seven million and a strong sports legacy, the state holds the potential to become one of the big- gest sports betting markets in the US. An asset deal for a sports media in an emerging market for 4.3 mUSD was made. The Group hosted its firs t ever Capital Markets Day in March reflecting on the performance since the IPO in 2018 as well as laying out the strategy for the future. The presentation can be found here. On February 21, a share buyback program was initiated for up to 10 mEUR, to be executed during the period from February 22 to April 24, 2023. Better Collective’s esport community HLTV hosted the world’s largest esport award show, watched by more than 250.000 Counter Strike: Global Offensive fans. The Board of Directors implemented a new Long Ter m Incentive Plan for key employees. The total value of the 2023 LTI grant program is 2.9 mEUR (Black -Scholes value). Significant events after closure of the period April revenue of 27mEUR implying 40% growth. The Group acquired Skycon Limited and in doing so ex- panded its efforts within digital display advertising. With the acquisition the financial targets for 2023 were upgraded to: Revenue of 305 -315 mEUR (previously 290-300 mEUR), EBITDA before special items of 95-105 mEUR (previousl y 90 -100 mEUR), and Net debt to EBITDA before special items <2 (unchanged). The AGM 2023 was held electronically on April 25, 2023. On April 27, the UK Government published a “White Pa- per” as part of a Gambling Act review. Better Collective welcomes the long-awaited proposed initiatives with a stronger focus on safer gambling. Given the proactive compliance measures sportsbooks had already taken, the Group estimates the proposed measures to have zero to limited financial impact on the Group. The share buyback program init iated on February 21, was complete on April 25. ===== SIDA 5 ===== Q1 report 2023 Page 4 Financial highlights and key figures tEUR Q1 2023 Q1 2022 2022 Income statements Revenue 87,945 67,394 269,297 Recurring revenue 40,882 23,403 123,365 Revenue Growth (%) 30% 74% 52% Organic Revenue Growth (%) 23% 44% 34% Operating profit before depreciation, amortization, and special items (EBITDA before special items) 33,275 23,111 85,075 Operating profit before depreciation and amortization (EBITDA) 32,667 21,430 85,021 Depreciation 713 487 2,321 Operating profit before amortization and special items (EBITA before special items) 32,561 22,624 82,754 Special items, net - 607 - 1,681 - 54 Operating profit before amortization (EBITA) 31,954 20,943 82,700 Amortization and impairment 3,871 2,289 12,347 Operating profit before special items (EBIT before special items) 28,691 20,336 70,407 Operating profit (EBIT) 28,083 18,655 70,353 Result of financial items - 735 - 621 - 5,389 Profit before tax 27,348 18,033 64,964 Profit after tax 20,935 13,742 48,075 Earnings per share (in EUR) 0.38 0.25 0.88 Diluted earnings per share (in EUR) 0.36 0.24 0.85 Balance sheet Balance Sheet Total 802,970 639,734 785,229 Equity 423,449 369,912 412,917 Current assets 107,722 76,707 95,025 Current liabilities 63,033 57,420 65,068 Net interest-bearing debt 219,388 132,298 227,151 tEUR Q1 2023 Q1 2022 2022 Cashflow Cash flow from operations before special items 33.360 13.145 69.816 Cash flow from operations 32.966 13.045 68.423 Investments in tangible assets 187 - 269 - 1.788 Cash flow from investment activities - 21.278 - 19.147 - 112.632 Cash flow from financing activities - 7.724 9.007 65.737 Financial ratios Operating profit before depreciation, amortization (EBITDA) and special items margin (%) 38% 34% 32% Operating profit before amortization margin (EBITDA) (%) 37% 32% 32% Operating profit margin (%) 32% 28% 26% Publishing segment - EBITDA before special items margin (%) 43% 42% 38% Paid media segment - EBITDA before special items margin (%) 27% 15% 16% Net interest bearing debt / EBITDA before special items 2,30 2,01 2,67 Liquidity ratio 1,71 1,34 1,46 Equity to assets ratio (%) 53% 58% 53% Cash conversion rate before special items (%) 100% 57% 80% Average number of full-time employees 926 792 878 NDCs (thousand) 488 350 1.683 For definitions of financial ratios, see definitions section in the end of the report. ===== SIDA 6 ===== Q1 report 2023 Page 5 CEO Letter Another record- breaking quarter and big strategic ambitions Q1 proved to be another record -breaking quarter. The p erformance was driven by Latin America and state launches in the US as well as general strong underlying organic growth across the Group. The last couple of years, Better Collective has been on a transformational journey developing itself from a performance -based marketing business into a digital sports media group. In Q1, the Group hosted its first Capital Markets Day where the framework for Better Collective’s vision was presented. Record breaking quarter continuously absorbing US revenue share transition In Q1 we continued last year’s strong momentum. Reve- nue grew 30% YOY, while operational leverage proved its worth as EBITDA grew 44% YOY. In itself, this growth is impressive, yet even more impressive when consider- ing th e strong growth, we saw last year. Additionally, last year’s US revenue was positively impacted by one- time payments (CPA), while this year we are continuing the transition towards recurring revenue share. At our Capital Markets Day (CMD), it was highlighted that 63% of all NDCs sent during February were on rev- enue share. I am happy to inform you that this trend has continued. I am especially proud that we yet again de- livered a record quarter with the North American market contributing with 19% growth, while absorbing the rev- enue share transition. During the Ohio launch in January, our US business did extremely well, and from a r egula- tory framework and operational perspective it was a perfect state launch. The Massachusetts launch in March also generated good activity, however, due to regula- tory wavering and the NFL season being over, thi s was not as strong as Ohio’s. As seen in t he past quarters, Latin America continued its strong growth trajectory during Q1, and we have strengthened our presence and efforts in the region significantly. Furthermore, Media Partnerships continue to be a strong driver of growth in Europe & ROW. This combined with a strong underlying growth in Europe we managed to grow 40 % in this re- gion during Q1. It is worth mentioning the strong devel- opment in our Paid Media business as well, which grew 51% YOY on topline and more importantly 17 4% on op- erational earnings with the margin going from 15% to 27% YOY. Truly a strong sentiment to our operational development and our investment in transitioning to re- curring revenue share. Our Group’s momentum contin- ued into April where revenues grew 40% YOY. It is worth remembering that our business is reliant on sports ac- tivity and thereby fairly season al. This means that the sports activity is expected to slow down during the low season in the summer period as usual. Strategy shift requires building new capabilities Venturing into the digital sports media market means that we have expanded Better Collec tive’s addressable market significantly, but it has also required that we as a group adapt new capabilities. A core strength of Bet- ter Collective is its ability to employ performance-based marketing when referring new customers to sports- books through SEO and CRO expertise to maximize traf- fic and conversion rates. As such, our focus has been to provide trustworthy and clear content with moderate depth. However, with our vision t o become the leading digital sports media group, focus has expanded to also include the maximization of viewers, engagement, time on site, and monthly active users combined with efforts to provide the best user experiences through innovative products. Consequently, our content has and will con- tinue to become deeper, more frequent, newsworthy, as well as investigative with the objective of engaging as many sports fans as possible. This shift in focus is not meant to take precedence but should build on top of Better Collective’s legacy and expertise - after all it is thanks to our strong legacy that we find ourselves in a highly attractive spot in the sports media industry. Bet- ter Collective excels at maximizing the value of large readerships because we can utilize our unique skills and diversified business models, and these capabilities w ill continue to ensure organic growth. Risk mitigation; a positive side effect from growth and strategic focus Better Collective has progressed from being ”a busi- ness” to bein g an “integrated collective of businesses' with an increased reach and a more diversified offering, which in recent years has proven its worth. We have de- creased the dependency on search engine traffic from around 60% to less than 35% by mainly acquiring strong brands with heavy direct traffic. Previously, our largest business partner accounted for 50% of the Group’s rev- enue. Today, the same and still largest partner accounts for less than 20%, though we have grown the partner- ship significantly in absolute terms. Five years ago, 85% ===== SIDA 7 ===== Q1 report 2023 Page 6 of revenues were generated from Europe. In 2022, 40% of revenues stemmed from the US alone, and we have only just recently dipped our toes into the Latin Ameri- can and Canadian markets. As such, working to mitigate the risks in our business benefits not only Better Collec- tive but also our partners and shareholders. M&A will remain a core part of our strategy Combining a focus on organic growth and M&A has proven beneficial in the digital sports media industry. Since the IPO in 2018, Better Collective has made 29 ac- quisitions, which undeniably makes M&A a core part of the business strategy. However, the overarching shift in strategy also affects our M&A approach. Until recently, acquisition targets on ly consisted of “traditional” per- formance-based marketing companies with a user data- base on recurring revenue share agreements. The strat- egy and objective were to roll-up enough assets to gain critical scale - like we have now. The past y ear and on- wards, our M&A strategy is to acquire strong local and global sports media with a large and loyal readership, preferably with revenue mainly generated from a single business model in regular advertising. By acquiring such assets, we establish a u nique chance for the Group to leverage its legacy expertise in optimization while utiliz- ing our business models to grow reach and revenue. If you wish to dive more into our M&A strategy, I urge you to watch our Capital Markets Day as CFO, Flemming Pedersen, walked through t he Group’s strategic M&A objectives. Our massive reach deserves an in-house AdTech platform In the Q4 report, we announced a strategic investment in a new AdTech platform. An AdTech platform is a tech- nology platform using advanced data analytics and ma- chine learning algorithms that analyze user behavior in order to provide valuable and engaging advertising tar- geting specific needs. Put simply, by building an in - house AdTech platform Better Collective will be able to offer targeted marketing ads directly to the millions of sport fans that visit the Group’s broad portfolio of sports brands. Several third-party platforms already exist, and as Better Collective has been highly acquisitive, we have managed to accumulate several AdTech platforms. However, by build ing our own platform we can now streamline the process and maximize the yield. So, why now? As also highlighted at the CMD, Better Collective’s reach has grown significantly from +7m monthly visits in 2018, to +150m monthly visits in 2022 . We have truly gained critical scale in our reach and see an increasing demand from our business partners want- ing to market their products in the advertising space on our sports media. These partners range from long - standing sportsbook partners to global payment provid- ers, companies in the energy drink market, and many more. Revenue diversification mitigates risk and makes us more relevant to our partners By building an AdTech platform, Better Collective will add to its legacy in performance -based marketing and venture into brand marketing (cost per mille, cost per engagement, cost per view). Not only will this move fur- ther diversify our revenue streams, but it will also make us more attractive to our business partners. Large syn- ergies can be achieved across our Group, e.g. , for our media partnerships we now also have the capabilities to serve the general sports sections with advertisement in- stead of just the sports betting sections. Q1 was the development, testing, and ramp up phase of our AdTech platform. I have already received initial pos- itive feedback from various business partners, who acknowledge that there is a big demand for our offering. The investment will elevate Better Collective to become an even stronger AdTech machine which aligns p er- fectly with our vision of becoming the Leading Digital Sports Media Group. Q1 report 2023 Page 6 Co-founder & CEO Jesper Søgaard ===== SIDA 8 ===== Q1 report 2023 Page 7 Business review and financial performance Q1 2023 Group Q1 delivered a record -breaking performance with growth of 30% equaling revenue of 88 mEUR, with an organic growth of 23%. The growth in revenue came de- spite a tough comparison quarter in 2022 where with the opening of online sports betting in the state of New York was a strong growth driver. Revenues in the US were mainly CPA last year, until the revenue share transition started in Q2 -Q3 and has con- tinued into Q1 2023. Recurring revenue was 41mEUR, implying 75% growth . This is 46% of Group revenues versus 35% last year. Of the recurring revenues 82% came from revenue share in- come, 11% from subscription and 7% from CPM sales. The number of NDCs delive red to partnering spo rtsbooks continued its strong growth trend. Q1 delivered 488K new depositing customers, of which 71% was on revenue share. EBITDA before special items was 33mEUR, implying a margin of 38% and growing 44% YOY , showing strong operational leverage in the business. The sports win margin improved from Q1 2022 and is back at the average level seen historically as expected. Better Collective Group Key figures for the Group: tEUR Q1 2023 Q1 2022 Growth 2022 Revenue 87,945 67,394 30% 269,297 Cost 54,670 44,283 23% 184,222 Operating profit before depreciation, amortization, and special items 33,275 23,111 44% 85,075 EBITDA-Margin before special items 38% 34% 32% Operating profit before depreciation and amortization 32,667 21,430 52% 85,021 EBITDA-Margin 37% 32% 32% Organic Growth 23% 44% 34% ===== SIDA 9 ===== Q1 report 2023 Page 8 Publishing The Publishing business includes revenue from Better Collective’s proprietary owned and operated sports me- dia and media partnerships. The traffic to these brands is mostly direct or through organic search results. Revenues from this segment came in at 59 mEUR imply- ing 22% growth of which 26% was organic. Operational earnings came in at 25 mEUR, implying a margin of 43%, equaling a 26 % growth YOY. The Publishing segment accounted for 67% of group revenues and 76% of oper- ational earnings. The topline growth in the Publishing business came from solid growth in all geographies. Better Collective’s me- dia partnerships continued to deliver strong growth in revenues and NDCs. During Q1, Better Collective entered a partnership with the globally covering, digital soccer platform Goal. This media part nership is the first f ully digital and global partnership in the Better Collective’s portfolio. Further, a partnership with PUNCH in Nigeria was signed, which marks the Group’s first move into an exciting growth market and a new continent. Lastly, Better C ollective signed a par tnership with the well-established Polish news portal Wirtualna Polska. Paid Media The Paid Media business includes revenues from Better Collective’s efforts in paid advertising on search en- gines, such as Google and Bing, as well as advertising on third party sports media. Given the upfront payment to advertise on third party platforms the gross margin is lower than the Publishing business. Paid Media revenue was 2 9 mEUR for Q1, implying growth of 51%, of which all was organic. Since the acqui- sition of Atemi in 2020, Better Collective has invested in moving revenues in the Paid Media business from one - time payments (CPA) to recurring revenues. During Q1, 24.7% of revenues came from recurring reve- nues. Over the past quarters, the transition in revenue agreements has paid off as margins have improved and made it possible to further fuel growth. Operational earnings came in at 8 mEUR, implying a margin of 27%, which is the highest margin ever recorded for this part of the Better Collective business during any quarter. The margin moved from 15% to 27% which is a growth of 174%. These numbers confirm the decision to move rev- enues to recurring revenues. The strong growth in the Paid Media segments comes from a broadly based performance, especially a break- through in the North American market as well as contin- ued good performance in Latin America. Publishing Key figures for the Publishing segment tEUR Q1 2023 Q1 2022 Growth 2022 Revenue 59,204 48,380 22% 187,057 Share of Group 67% 72% 69% Cost 33,795 28,144 20% 115,376 Share of Group 62% 64% 63% Operating profit before depreciation, amortization, and special items 25,409 20,237 26% 71,681 Share of Group 76% 88% 84% EBITDA-Margin before special items 43% 42% 38% Operating profit before depreciation and amortization EBITDA-margin 24,802 42% 18,555 38% 34% 71,627 38% Organic growth 12% 53% 41% tEUR Q1 2023 Q1 2022 Growth 2022 Revenue 28,741 19,014 51% 82,241 Share of Group 33% 28% 31% Cost 20,875 16,140 29% 68,846 Share of Group 38% 36% 37% Operating profit before depreciation, amortization, and special items 7,866 2,874 174% 13,394 Share of Group 24% 12% 16% EBITDA-Margin before special items 27% 15% 16% Operating profit before depreciation and amortization 7,866 2,874 174% 13,394 EBITDA-Margin 27% 15% 16% Organic Growth 51% 26% 45% Paid Media Key figures for the Paid Media segment ===== SIDA 10 ===== Q1 report 2023 Page 9 Europe & Rest of World (ROW) The Europe & ROW business includes all markets out- side of North America. The European markets consist of more mature markets and are the legacy markets of Bet- ter Collective. Latin America has been a strong growth market for Better Collective and makes up an increas- ingly bigger part of the business. Examples of sports brands in this business include Soccernews in the Neth- erlands, Betarades in Greece, Wettbasis in Germany, goal.pl in Poland, Les Transferts in France, and many others. The strategy is to own some of the strongest lo- cal sports media in all relevant regions. Given the strong legacy in these markets where Better Collective has be en sending revenue share customers the past decade, there is a lot of recurring revenue in this business. It also means that this business is the most im- pacted by fluctuations in the sports win margin. During Q1, Europe & ROW saw record revenues of 5 1 mEUR implying growth of 40%, of which 23% was or- ganic. Operational earnings came in at 19 mEUR, imply- ing a margin of 37%, growing 87%. Europe & ROW reve- nue accounted for 58% of Group revenue and 56% of op- erational earnings. The topline growth in Europe & ROW came from an all -around solid performance fueled by strong growth in Latin America and media partnerships’ continuing their momentum. As expected, the sports win margin has returned to the historical average level during the past few quarters. North America From Q1 2023 and onwards, Better Collective will start reporting on the North American market instead of US. In the Group’s reporting, North America is made up by the US and Canada, the latter previously being part of Europe & ROW. The reason for the change is that inter- nally Canadian operations are now reported as US brands, while the Canadian team also works closely with the US organization and is managed out of the New York office. For transparency we provide the following num- bers: Q1 23 revenue for Canada was 1.3mEUR (0.1mEUR Q1 22) and EBITDA was 1.3mEUR (0.1mEUR). For the full year of 2022 revenue was 3.3m EUR and EBITDA was 3.2mEUR. Both the US and the Canadian markets are somewhat recently regulated. The US started regulating in 2018 with the PASPA repeal. As both markets are young, rev- enues have to a large extent been generated from one- time payments. Last year, Better Collective started to transition towards recuring revenues in the US. North American sports brands include, but are not limited to, Action Network, VegasInsider, Scores&Odds, Ro- toGrinders, and Canada Sports Betting. The North American revenue came in at 37 mEUR, implying growth of 19% during Q1, of which 18% was organic. Operational earnings came in at 15 mEUR, implying a margin of 33%, or growth of 11%. North American revenues consisted of 42% of the Group and operational earnings of 44%. Bet- ter Collective has been pu shing for revenue share agreements in the North American markets since 2018 . and successfully initiated the transition during 2022, which impacted the business short -term by 15 mEUR. The 19% growth seen in Q1 should be considered in the light of this transition, as the Group now delivers 60% - 70% of North American NDCs on revenue share con- tracts. These contracts agree for r ecurring revenue but have a short -term dampening effect as revenue is not recognized upfront. Additionally, the growth should also be held up against Q1 2021, as last year’s quarter was very strong with the launch of sports betting in New York. Overall, performance was a mix of good underly- ing growth in existing states as well as the states of Ohio and Massachusetts launching sports betting. Key figures for North America and Europe & RoW segments Europe & ROW North America tEUR Q1 2023 Q1 2022 Growth Q1 2023 Q1 2022 Growth Revenue 50,802 36,286 40% 37,143 31,108 19% Share of Group 58% 54% 42% 46% Cost 32,070 26,261 22% 22,600 18,022 25% Share of Group 59% 59% 41% 41% Operating profit before depreciation, amortization, and special items 18,732 10,025 87% 14,543 13,086 11% Share of Group 56% 43% 44% 57% EBITDA-Margin before special items 37% 28% 39% 42% Operating profit before depreciation and amortization 18,124 9,924 83% 14,543 11,505 26% EBITDA-Margin 36% 27% 39% 37% Europe & ROW and North America ===== SIDA 11 ===== Q1 report 2023 Page 10 Financial performance first quarter 2023 Revenue growth of 30% to 88 mEUR and organic growth of 23% Revenue YTD sho wed strong growth vs. 2022 of 30 % and amounted to 87.9 mEUR ( Q1 2022: 67.4 mEUR ). Revenue share accounted for 38 % of the revenue with 46% coming from CPA, 5% from subscription sales, and 11% from other income. Cost of 55 mEUR - up from 44 mEUR Overall, the cost base has increased compared to 2022 due to t he acquisitions in first half of 2022, which has increased the cost by 0.5 mEUR, and Paid Media in- creased cost to drive additional traffic and revenue, whereas media partnerships increased, primarily dire ct cost. The cost base excluding depreciation and amorti- zation grew 10.4 mEUR, up to 54.7 mEUR Q1 2023 (Q1 2022: 44.3 mEUR). A significant part of the increase in cost base relates to the AdTech platform and LATHAM expansion totaling 4.7 mEUR in Q1 2023. Total direct cost relating to revenue increased by 4 mEUR to 27.1 mEUR ( Q1 2022: 23.1 mEUR) with the growth coming from increased cost in Paid Media (driv- ing additional revenue), and direct costs related to me- dia partnerships. Beyond the cost of paid traffic, this in- cludes hosting fees of websites, content generation, and external development. Personnel cost Q1 increased 35% from YTD 2022 to 21.2 mEUR Q1 2023 (Q1 2022: 15.7 mEUR). The average num- ber of employees increased 17 % to 926 (Q1 2022: 792). Personnel costs include costs related to warrants of 0.2 mEUR (Q1 2022: 0.4 mEUR). Other external costs increased 0.8 mEUR or 15% to 6.3 mEUR (Q1 2022: 5.5 mEUR). Depreciation and amortiza- tion amounted to 4.6 mEUR (Q1 2022: 2.8 mEUR). The increase is primarily due to amortization related to the acquisition of FUTBIN. Special items YTD special items amounted to a cost of 0.6 mEUR (Q1 2022: 1.7 mEUR). The net cost of 0.6 mEUR is primarily related to M&A expenses of 0.4 mEUR. Earnings Operational earnings (EBITDA ) before special items grew 44% to 33.3 mEUR ( Q1 2022: 23.1 mEUR). The EBITDA-margin before special items was 38% (Q1 2022: 34%). Including special items, the reported EBITDA was 32.7 mEUR. (Q1 2022: 21.4 mEUR). EBIT before special ite ms increased 41% to 28.7 mEUR (Q1 2022: 20.3 mEUR). Including special items, the re- ported EBIT was 28 mEUR (Q1 2022: 18.7 mEUR). Net financial items Net financial costs amounted to 0.7 mEUR (Q1 2022: 0.6 mEUR) and included net interest, fees relating to bank credit lines and exchange rate adjustments. Net financial costs are impacted by an unrealized gain of 2.2 mEUR on Catena Media shares. Interest expenses amounted to 2 mEUR and included non-payable, calcula ted interest expenses on certain balance sheet items, whereas finan cial fees and net exchange rate gain amounted to 0.6 mEUR and 0.6 mEUR respectively. Income tax Better Collective has a tax presence in the places where the company is incorporated . These places count Den- mark (where the parent company is incorporated), Aus- tria, France, Greece, Malta, Netherlands, Poland, Portu- gal, Romania, Serbia, Sweden, UK, and US. Income tax Q1 2023 amounted to 6.4 mEUR (Q1 2022: 4.3 mEUR). The Effective Tax Rate (ETR) was 23.5% (Q1 2022: 23.8%). Net profit Net profit after tax was 20 .9 mEUR ( Q1 2022: 13.7 mEUR). Earnings per share (EPS) nearly doubled to 0.38 EUR/share vs. 0.25 EUR/share Q1 2022. Equity The equity increased to 4 23.4 mEUR as per March 31, 2023, from 412.9 mEUR on December 31, 2022. Besides the Q1 profit of 20. 9 mEUR, t he equity has been impacted by acquisition and disposal of treasury shares of 5.9 mEUR and share based payments of 0.2 mEUR. The decrease in USD vs. EUR has impacted the equity by 5.1 mEUR. Balance sheet Total assets amounted to 803 .0 mEUR (202 2: 785.2 mEUR), with an equity of 423.4 mEUR (202 2: 412.9 mEUR). This corresponds to an equity to assets ratio of 53% (2022: 53%). The liquidity ratio was 0. 59 resulting from current assets of 107.7 mEUR and current liabilities of 63.2 mEUR. The ratio of net interest-bearing debt to EBITDA before special items was 2 .3 at the end of the quarter. ===== SIDA 12 ===== Q1 report 2023 Page 11 Investments During the quarter investments in accounts and other intangibles amounted to 13.9 mEUR. Cash flow and financing Cash flow from operations before special items Q1 2023 was 33.4 mEUR (Q1 2022: 13.1 mEUR) with a cash con- version of 100%. Better Collective has bank credit facilities of a total 247 mEUR. By the end of March 2023, capital reserves stood at 91.6 mEUR consisting of cash of 28.8 mEUR, other cur- rent financial assets of 17.1 mEUR in form of listed shares and unused bank credit facilities of 45.6 mEUR. The parent company Better Collective A/S, Denmark, is the parent company of the Group. Revenue grew by 95% to 23 .7 mEUR ( Q1 2022: 12.1 mEUR). Total costs including depreciation and amortization was 19.7 mEUR (Q1 2022: 13.0 mEUR). Profit after tax was 2.8 mEUR (Q1 2022: 5.5 mEUR). The change in profit after tax is primarily due to YOY differ- ences in dividend payments from subsidiaries, exchange rate adjustments, and corporate tax. Total equity ended at 4 10.7 mEUR by March 31 , 202 3 (2022: 411 mEUR). The equity in the parent company was impacted by treasury share transactions ( 5.9 mEUR), cost of warrants of 0.2 mEUR and merger with HLTV (3.2 mEUR). Disclaimer This report contains forward -looking statements which are based on the current expectatio ns of the manage- ment of Better Collective. All statements regarding the future are subject to inherent risks and uncertainties, and many factors can lead to actual pr ofits and devel- opments deviating substantially from what has been ex- pressed or implied in such statements. Financial targets 2023 The board of directors have decided on targets for the financial year 2023 as announced in the 2022 full year report. Following the acquisition of Skycon Limited, the financial targets were upgraded: • Revenue of 305-315 mEUR (previously 290-300 mEUR) • EBITDA before special items of 95-105 mEUR (previously 90-100 mEUR) • Net debt to EBITDA before special items <2.0 (un- changed) Financial targets 2023-2027 The board of directors has decided on new financial tar- gets for the Better Collective Group for 2023 -2027 (in- clude M&A): • Revenue CAGR of +20% • EBITDA margin before special items of 30-40% • Net debt to EBITDA before special items of <3 The long-term target assumes that M&A are solely fi- nanced by own cash flow and debt. Financial targets 2023 Updated Target 2023 Target 2023 Actual 2022 Organic growth (%) - 34% Revenue 305-315 mEUR 290-300 mEUR 269.3 mEUR EBITDA (before special items) 95-105 mEUR 90-100 mEUR 85.1 mEUR Net interest bearing debt/EBITDA <2.0 <2.0 2.67 ===== SIDA 13 ===== Q1 report 2023 Page 12 Other Shares and share capital Better Collective A/S is listed on Nasdaq Stockholm main market. The shares are traded under the ticker “BETCO”. As per March 31, 2 023, the share capital amounted to 55 1,546.69 EUR, and the total num ber of issued shares was 55,154,669. The company has one (1) class of shares. Each share entitles the holder to one vote at the general meetings. On March 20, 2023, the board of directors resolved to issue 5,000 new ordinary shares in Better Collective A/S , related to the exercise of warrants. Shareholder structure As of March 31, 2023, the total number of shareholders was 3,8 63. A list of top 10 shareholders in Better Collective A/S can be found on the company’s website. Annual General Meeting 2023 The Annual General Meeting 2023 was held on April 25, 2023. All items on the agenda were carried including the CXO incentive program. Please refer to the notice to convene AGM for details. Incentive programs To attract and retain key competences, the company has established warrant programs for certain key employees. All warrants with the right to subscribe for one ordinary share. If all outstanding warrants are sub- scribed, then the maximum shareholders dilution will be approximately 3.2%. On January 3, 2023, the board of directors implemented a Long Term Incentive Plan (LTI) for key employees in the Better Collective group. In total the grants under the LTI in 2023 cover 13 4.953 performance share units and 239,350 share options to 63 key employees in total, vesting over a 3-year period. The total value of the 2023 LTI grant program is 2.9 mEUR (calculated @Black - Scholes value) measured at the target level, which is to say 100% achievement of the financial goals. Risk management Through an Enterprise Risk Management process, vari- ous gross risks in Better Collective are identified. Each risk is described, including current risk mitigation in place, or planned mitigating actions. The subsequent analysis of the identified risks includes an inherent risk evaluation based on two main parameters: probability of occurrence and impact on future earnings and cash flow. Better Collective’s management continuously monitors risk development in the Better C ollective Group. The risk evaluation is presented to the Board of Directors annually, for discussion and any further miti- gating actions required. The Board evaluates risk dynamically to account for this variation in risk impact. The policies and guideline s in place stipulate how management must work with risk management. Better Collective’s compliance with these policies and guidelines is also monitored by the man- agement on an ongoing basis. Better Collective seeks to identify and understand risks and mitigate them accord- ingly. Also, the Group’s close and longstanding relation- ships with customers allow Better Collective to antici- pate and respond to market movements and new regu- lations including compliance requirements from author- ities and sportsbooks. With the US division, the overall risk profile of Better Collective has changed, and regu- latory/compliance as well as financial risk has increased. Better Collective has mitigated the additional risks in US in several ways, regulatory and compliance risk through involvement of regulatory bodies in our licensing pro- cess for newly established entities, financial risk through a performance-based valuation of the acquired entities), and organizational risk through establishment of local governance/management, and fi nance, HR, and Legal organization dedicated to the US operations. During 2022 the macroeconomic environment has impacted the global economy with rising interest rates. Better Col- lective has mitigated and addressed the cre dit and in- terest rate risk by entering a new long-term committed facility with three banking partners, securing attractive terms and a long -term 2+1 commitment. Other key risk factors are described in the Annual report 2022. ===== SIDA 14 ===== Q1 report 2023 Page 13 Contacts Senior Director of Group Strategy, IR and Corporate Communications; Mikkel Munch-Jacobsgaard investor@bettercollective.com This information is such information as Better Collective A/S is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out above on May 16, 2023, after market close (CET). About With a vision to become the Leading Digital Sports Me- dia Group, Better Collective owns and operates interna- tional and local sports communities and media that aim to make sports entertainment more engaging and fun. Via its online media, the Group provides prime quality content, data insights, betting tips and educational tools for enthusiastic sports fans. Better Collective's portfolio includes Action Network, VegasInsider.com, HLTV.org, FUTBIN.com, and bettingexpert.com. To learn more about Better Collective please visit www.Bettercollective.com Q1 report 2023 Page 13 ===== SIDA 15 ===== Q1 report 2023 Page 14 Statement by the BoD and the executive management Statement by the Board of Directors and the executive management on the condensed consolidated inte rim financial statements and the parent company condensed interim financial statements for the period January 1 – March 31, 2023. Today, the Board of Directors and the e xecutive management have discussed and approved the condensed consolidated interim fi nancial statements and the parent company condensed interim financial statements of Better Collective A/S for the period January 1 – March 31, 2023. The condensed consolidated interim financial state- ments for the period January 1 – March 31, 2023, are pre- pared in accordance with IAS 34 Interim Financial Re- porting as adopted by the EU, and additional require- ments of the Danish Financial Statements Act. The Par- ent Company condensed interim financial statements have been included according to the Danish Exec utive Order on the Preparation of Interim Financial Reports. In our opinion, the condensed consolidated interim financial statements and the parent company con- densed interim financial statements give a true and fair view of the Group’s and Parent Company ’s a ssets, liabilities and financial position on March 31, 2023, and of the results of the Group’s and Parent Company’s op- erations and the Group’s cash flows for the period January 1 – March 31, 2023. Further, in our opinion, the management’s review gives a fair review of the development in the Group’s and the Parent Company’s operations and financial matters and the results of the Group’s and the Parent Company’s op- erations and financial position, as well as a description of the major risks and uncertai nties, the Group and the Parent Company are facing. The Interim Report has not been audited nor reviewed by the Company’s auditor. Copenhagen, May 16, 2023 Executive management Jesper Søgaard CEO & Co-founder Flemming Pedersen CFO Executive Vice President Christian Kirk Rasmussen COO & Co-founder Executive Vice President Board of Directors Jens Bager Chair Therese Hillman Vice Chair Todd Dunlap Klaus Holse Leif Nørgaard Petra von Rohr ===== SIDA 16 ===== Q1 report 2023 Page 15 Financial statements for the period January 1 – March 31 Condensed interim consolidated income statement Note tEUR Q1 2023 Q1 2022 2022 3 Revenue 87,945 67,394 269,297 Direct costs related to revenue 27,149 23,077 92,227 4 Staff costs 21,226 15,711 68,639 Other external expenses 6,295 5,495 23,356 Operating profit before depreciation and amortization (EBITDA) and special items 33,275 23,111 85,075 Depreciation 713 487 2,321 Operating profit before amortization (EBITA) and special items 32,561 22,624 82,754 7 Amortization and impairment 3,871 2,289 12,347 Operating profit (EBIT) before special items 28,691 20,336 70,407 5 Special items, net - 607 - 1,681 - 54 Operating profit 28,083 18,655 70,353 Financial income 2,672 2,317 4,198 Financial expenses 3,407 2,938 9,587 Profit before tax 27,348 18,033 64,964 6 Tax on profit for the period 6,414 4,292 16,888 Profit for the period 20,935 13,742 48,075 Earnings per share attributable to equity holders of the company Average number of shares 55,154,113 54,266,062 54,363,312 Average number of warrants - converted to number of shares 2,419,909 2,324,645 2,495,614 Earnings per share (in EUR) 0.38 0.25 0.88 Diluted earnings per share (in EUR) 0.36 0.24 0.85 Condensed interim consolidated statement of other comprehensive income Note tEUR Q1 2023 Q1 2022 2022 Profit for the period 20,935 13,742 48,075 Other comprehensive income Other comprehensive income to be reclassified to profit or loss in sub- sequent periods: Currency translation to presentation currency - 678 - 174 - 905 Currency translation of non-current intercompany loans - 5,107 5,458 17,030 Income tax 1,123 - 1,201 - 3,747 Net other comprehensive income/loss - 4,661 4,083 12,379 Total other comprehensive income/(loss) for the period, net of tax 16,274 17,825 60,454 Attributable to: Shareholders of the parent 16,274 17,825 60,454 ===== SIDA 17 ===== Q1 report 2023 Page 16 Condensed interim consolidated balance sheet Note tEUR Q1 2023 Q1 2022 2022 Assets Non-current assets 7 Intangible assets Goodwill 182,108 180,112 183,942 Domains and websites 459,833 347,666 460,513 Accounts and other intangible assets 33,046 22,746 27,016 Total intangible assets 674,987 550,525 671,471 Property, plant and equipment Land and buildings Right of use assets 5,634 2,493 6,269 Leasehold improvements, Fixtures and fittings, other plant and equipment 2,758 1,798 2,574 Total property, plant and equipment 8,393 4,291 8,843 Other non-current assets Deposits 1,623 601 726 8 Deferred tax asset 10,245 7,609 9,165 Total other non-current assets 11,868 8,211 9,891 Total non-current assets 695,248 563,027 690,204 Current assets Trade and other receivables 51,059 42,393 53,179 Corporation tax receivable 7,196 822 6,423 Prepayments 3,499 2,813 3,926 Other current financial assets 17,121 0 0 Cash 28,847 30,680 31,497 Total current assets 107,722 76,707 95,025 Total assets 802,970 639,734 785,229 Note tEUR Q1 2023 Q1 2022 2022 Equity and liabilities Equity Share Capital 552 548 551 Share Premium 272,594 271,937 272,550 Currency Translation Reserve 18,516 14,881 23,177 Treasury Shares - 13,577 - 7,385 - 7,669 Retained Earnings 145,366 89,929 124,307 Proposed Dividends 0 0 0 Total equity 423,449 369,912 412,917 Non-current Liabilities 8 Debt to credit institutions 201,383 136,968 201,708 8 Lease liabilities 4,931 1,297 4,962 8 Deferred tax liabilities 81,013 70,556 78,167 8 Other long-term financial liabilities 29,161 3,582 22,407 8 Contingent Consideration 0 0 0 Total non-current liabilities 316,488 212,403 307,244 Current Liabilities Prepayments received from customers and deferred reve- nue 8,136 4,111 8,023 Trade and other payables 19,674 20,023 22,252 Corporation tax payable 5,343 3,947 5,221 8 Other financial liabilities 27,482 19,765 26,865 8 Contingent Consideration 0 8,208 0 Debt to credit institutions 1,292 0 1,055 Debt to mortgage credit institutions 0 0 0 8 Lease liabilities 1,106 1,365 1,653 Total current liabilities 63,033 57,420 65,068 Total liabilities 379,521 269,822 372,312 Total Equity and liabilities 802,970 639,734 785,229 ===== SIDA 18 ===== Q1 report 2023 Page 17 Condensed interim consolidated statement of changes in equity tEUR Share capital Share premium Currency translation reserve Treasury shares Retained earnings Proposed dividend Total equity As of January 1, 2023 551 272,550 23,177 - 7,669 124,307 0 412,917 Result for the period 0 0 0 0 20,935 0 20,935 Other comprehensive income Currency translation 0 0 - 5,784 0 0 0 - 678 Tax on other comprehensive income 0 0 1,123 0 0 0 1,123 Total other comprehensive income 0 0 - 4,661 0 0 0 - 4,661 Total comprehensive income for the year 0 0 - 4,661 0 20,935 0 16,274 Transactions with owners Capital Increase 0 43 0 0 0 0 44 Acquisition of treasury shares 0 0 0 - 5,903 0 0 - 5,903 Disposal of treasury shares 0 0 0 0 0 0 0 Share based payments 0 0 0 0 126 0 126 Transaction cost 0 0 0 - 6 - 2 0 - 8 Total transactions with owners 0 43 0 - 5,909 124 0 - 5,741 At March 31, 2023 552 272,594 18,516 - 13,577 145,366 0 423,449 During the period no dividend was paid. tEUR Share capital Share premium Currency translation reserve Treasury shares Retained earnings Proposed dividend Total equity As of January 1, 2022 546 267,873 10,798 - 8,074 73,705 0 344,848 Result for the period 0 0 0 0 13,742 0 13,742 0 Other comprehensive income 0 Currency translation 0 0 5,284 0 0 0 5,284 Tax on other comprehensive income 0 0 - 1,201 0 0 0 - 1,201 Total other comprehensive income 0 0 4,083 0 0 0 4,083 Total comprehensive income for the year 0 0 4,083 0 13,742 0 17,825 Transactions with owners Capital Increase 2 4,064 0 0 0 0 4,066 Acquisition of treasury shares 0 0 0 - 6,595 0 0 - 6,595 Disposal of treasury shares 0 0 0 7,284 484 0 7,769 Share based payments 0 0 0 0 2,013 0 2,013 Transaction cost 0 0 0 0 - 15 0 - 15 Total transactions with owners 2 4,064 0 689 2,482 0 7,238 At March 31, 2022 548 271,937 14,881 - 7,385 89,929 0 369,912 During the period no dividend was paid. ===== SIDA 19 ===== Q1 report 2023 Page 18 Condensed interim consolidated statement of changes in equity – continued tEUR Share capital Share premium Currency translation reserve Treasury shares Retained earnings Proposed dividend Total equity As of January 1, 2022 546 267,873 10,798 - 8,074 73,705 0 344,848 Result for the period 0 0 0 0 48,075 0 48,075 Other comprehensive income Currency translation 0 0 16,125 0 0 0 16,125 Tax on other comprehensive income 0 0 - 3,747 0 0 0 - 3,747 Total other comprehensive income 0 0 12,379 0 0 0 12,379 Total comprehensive income for the year 0 0 12,379 0 48,075 0 60,454 Transactions with owners Capital Increase 5 4,677 0 0 0 0 4,683 Acquisition of treasury shares 0 0 0 - 14,250 0 0 - 14,250 Disposal of treasury shares 0 0 0 14,656 842 0 15,498 Share based payments 0 0 0 0 1,713 0 1,713 Transaction cost 0 0 0 0 - 28 0 - 28 Total transactions with owners 5 4,677 0 406 2,526 0 7,615 At December 31, 2022 551 272,550 23,177 - 7,669 124,307 0 412,917 During the period no dividend was paid. ===== SIDA 20 ===== Q1 report 2023 Page 19 Condensed interim consolidated statement of cash flows Note tEUR Q1 2023 Q1 2022 2022 Profit before tax 27.348 18.033 64.964 Adjustment for finance items 735 621 5.389 Adjustment for special items 607 1.681 54 Operating Profit for the period before special items 28.691 20.336 70.407 Depreciation and amortization 4.584 2.775 14.668 Other adjustments of non-cash operating items 100 396 1.690 Cash flow from operations before changes in working capital and special items 33.375 23.507 86.765 Change in working capital - 15 - 10.362 - 16.949 Cash flow from operations before special items 33.360 13.145 69.816 Special items, cash flow - 395 - 101 - 1.393 Cash flow from operations 32.966 13.045 68.423 Financial income, received 463 646 1.682 Financial expenses, paid - 3.168 - 1.619 - 5.666 Cash flow from activities before tax 30.261 12.071 64.439 Income tax paid - 3.799 - 1.450 - 16.239 Cash flow from operating activities 26.462 10.621 48.200 9, 10 Acquisition of businesses 0 - 2.577 - 14.337 7, 10 Acquisition of intangible assets - 3.204 - 16.363 - 96.452 Acquisition of property, plant and equipment 187 - 269 - 1.804 Sale of property, plant and equipment - 238 - 0 16 Acquisition of other financial assets - 14.930 0 0 Change in other non-current assets - 3.093 62 - 55 Cash flow from investing activities - 21.278 - 19.147 - 112.632 Note tEUR Q1 2023 Q1 2022 2022 Repayment of borrowings - 1.486 - 5.040 - 215.993 Proceeds from borrowings 0 20.999 296.665 Lease liabilities - 373 - 343 - 1.274 Other non-current liabilities 0 0 0 Capital increase 44 0 618 Treasury shares - 5.903 - 6.595 - 14.250 Transaction cost - 6 - 15 - 28 Cash flow from financing activities - 7.724 9.007 65.737 Cash flows for the period - 2.540 482 1.306 Cash and cash equivalents at beginning 31.497 30.093 30.093 Foreign currency translation of cash and cash equivalents - 111 106 99 Cash and cash equivalents period end* 28.847 30.680 31.497 Cash and cash equivalents period end Restricted cash 0 0 0 Cash 28.847 30.680 31.497 Cash and cash equivalents period end 28.847 30.680 31.497 ===== SIDA 21 ===== Q1 report 2023 Page 20 Notes 1. General information Better Collective A/S is a limited liability company and is incorporated in Denmark. The parent company and its subsidiaries (referred to as the “Group” or “Better Collective”) engage in online affiliate marketing. Better Collective’s vision is to empower iGamers by leading the way in transparency and technology. Basis of preparation The Interim Report (condensed consolidated interim financial statements) for the period January 1 - March 31, 2023, has been prepared in accordance with IAS 34 “Interim financial statements” as adopted by the EU and additional require- ments in the Danish Financial Statements Act. The parent company condensed interim financial statements has been included according to the Danish Executive Order on the Preparation of Interim Financial Reports. These condensed consolidated interim financial statements incorporate the results of Better Collective A/S and its sub- sidiaries. The condensed consolidated interim financial statements refer to certain key performance indicators, which Better Col- lective and others use when evaluating the performance of Better Collective. These are referred to as alternative per- formance measures (APMs) and are not defined under IFRS. The figures and related subtotals give management and investors important information to enable them to fully analyze the Better Collective business and trends. The APMs are not meant to replace but to complement the performance measures defined under IFRS. New financial reporting standards All new or amended standards (IFRS) and interpretations (IFRIC) as adopted by the EU and which are effective for the financial year beginning on January 1, 2023, have been adopted. The implementation of these new or amended standards and interpretations had no material impact on the condensed consolidated interim financial statements. Accounting policies The condensed consolidated interim financial statements have been prepared using the same accounting policies as set out in note 1 of the 2022 annual report which contains a full description of the accounting policies for the Group and the parent company, except for the scope of operating segments. The scope of operating segments has been modified following changes in management responsibilities as from January 1, 2023. US has been renamed to North America (NA) and will now cover both USA and Canada. Canada was previously included in the operating segment “Europe and RoW”. 2022 comparative information has been restated. The annual report for 2022 including full description of the accounting policies can be found on Better Collective’s web- site: https://storage.mfn.se/0e9df7fa-f018-42b8-9189-6ee99458c094/bc-2022-annual-report-final.pdf Significant accounting judgements, estimates and assumptions The preparation of condensed consolidated interim financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts of revenue, expenses, assets, and liabilities. Beyond the risks mentioned above, the significant accounting judgements, estimates and assumptions applied in these consolidated interim financial statements are the same as disclosed in note 2 in the annu al report for 202 2 which contains a full description of significant accounting judgements, estimates and assumptions. ===== SIDA 22 ===== Q1 report 2023 Page 21 2. Segments Publishing and Paid Media Better Collective operates two different business models regarding customer acquisition with d ifferent earnings - profiles. The segments Publishing and Paid Media have been measured and disclosed separately for Revenue, Cost and Earnings. The Publishing business includes revenue from Better Collective’s proprietary online platforms and media partnerships where the online traffic is coming either directly or through organic search results, whereas Paid Media generates revenue through paid ad-traffic to our websites, thereby running on a significantly lower earnings margin. The performance for each segment is presented in the below tables: Publishing Paid Media Total tEUR Q1 2023 Q1 2022 Q1 2023 Q1 2022 Q1 2023 Q1 2022 Revenue 59,204 48,380 28,741 19,014 87,945 67,394 Cost 33,795 28,144 20,875 16,140 54,670 44,283 Operating profit before depreciation, amortization and special items 25,409 20,237 7,866 2,874 33,275 23,111 EBITDA-Margin before special items 43% 42% 27% 15% 38% 34% Special items, net - 607 - 1,681 0 0 - 607 - 1,681 Operating profit before depreciation and amortization 24,802 18,555 7,866 2,874 32,667 21,430 EBITDA-Margin 42% 38% 27% 15% 37% 32% Depreciation 713 481 0 5 713 487 Operating profit before amortization 24,088 18,074 7,866 2,869 31,954 20,943 EBITA-Margin 41% 37% 27% 15% 36% 31% 2022 tEUR Publishing Paid Media Total Revenue 187,057 82,241 269,297 Cost 115,376 68,846 184,222 Operating profit before depreciation, amortization, and special items 71,681 13,394 85,075 EBITDA-Margin before special items 38% 16% 32% Special items, net - 54 0 - 54 Operating profit before depreciation and amortization 71,627 13,394 85,021 EBITDA-Margin 38% 16% 32% Depreciation 2,306 15 2,321 Operating profit before amortization 69,321 13,379 82,700 EBITA-Margin 37% 16% 31% ===== SIDA 23 ===== Q1 report 2023 Page 22 2. Segments, continued Europe & Rest of World and North America Better Collective’s products cover more than 30 languages and attract millions of users worldwide - with international brands with a global reach as well as regional brands with a local reach. Better Collective’s regional brands are tailored according to the specific regions or countries and their respective regulations, sports, betting behaviors, user needs, and languages. From Q2 2021 and following the acquisition of Action Network (included in Group accounts from time of closing on May 28, 2021) the US market constitutes >20% of G roup Revenue and >30% of revenue in Publishing on an annualized basis. Hence, Better Collective reports on the geographical segments US and Europe & RoW (Rest of World), measuring and disclosing separately for Revenue, Cost and Earnings. Historical financi al figures are reported accord- ingly. The performance for each segment is presented in the below tables: Europe & ROW North America Total tEUR Q1 2023 Q1 2022 Q1 2023 Q1 2022 Q1 2023 Q1 2022 Revenue 50,802 36,286 37,143 31,108 87,945 67,394 Cost 32,070 26,261 22,600 18,022 54,670 44,283 Operating profit be- fore depreciation, amortization and spe- cial items 18,732 10,025 14,543 13,086 33,275 23,111 EBITDA-Margin be- fore special items 37% 28% 39% 42% 38% 34% Special items, net - 607 - 101 0 - 1,581 - 607 - 1,681 Operating profit before depreciation and amortization 18,124 9,924 14,543 11,505 32,667 21,430 EBITDA-Margin 36% 27% 39% 37% 37% 32% Depreciation 713 392 0 95 713 487 Operating profit be- fore amortization 17,411 9,532 14,543 11,411 31,954 20,943 EBITA-Margin 34% 26% 39% 37% 36% 31% * 2022 figures have been restated because of the transfer of Canada and renaming USA to North America (NA), which now covers both USA and Canada from January 1, 2023. 2022 tEUR Europe & ROW North America Total Revenue 170,756 98,541 269,297 Cost 117,392 66,830 184,222 Operating profit before depreciation, amortization and special items 53,364 31,711 85,075 EBITDA-Margin before special items 31% 32% 32% Special items, net - 1,360 1,306 - 54 Operating profit before depreciation and amortization 52,004 33,017 85,021 EBITDA-Margin 30% 34% 32% Depreciation 1,671 650 2,321 Operating profit before amortization 50,333 32,367 82,700 EBITA-Margin 29% 33% 31% ===== SIDA 24 ===== Q1 report 2023 Page 23 3. Revenue specification In accordance with IFRS 15 disclosure requirements, total revenue is split on Revenue Share, Cost per Acquisition (CPA), Subscription, and Other as follows: tEUR Q1 2023 Q1 2022 2022 Revenue category Recurring revenue (Revenue share, Subscription, CPM) 40,882 23,403 123,365 CPA, Fixed Fees 47,063 43,831 145,605 Other 0 160 327 Total revenue 87,945 67,394 269,297 %-split Recurring revenue 46 35 46 CPA, Fixed Fees 54 65 54 Other 0 0 0 Total 100 100 100 tEUR Q1 2023 Q1 2022 2022 Revenue type Revenue Share 33,617 19,559 96,449 CPA 40,246 39,900 124,324 Subscription 4,483 3,777 18,003 Other 9,598 4,158 30,521 Total revenue 87,945 67,394 269,297 %-split Revenue Share 38 29 36 CPA 46 59 46 Subscription 5 6 7 Other 11 6 11 Total 100 100 100 4. Share-based payment plans 2019 Warrant programs: During the first quarter of 2023 the company did not grant any warrants and 5,000 warrants were exercised under this program. 2022 Incentive Program: During the quarter no performance share units or share options were granted under this program. A new Lon g-term Incentive (LTI) program was established for key employees in Q1 2022, and 73,894 performance share units and 24,564 share options were granted to a total of 36 employees. 2023 Incentive Program: During the quarter a new Long -term Incentive (LTI) pro gram was established for key employees. Under the program 134,953 performance share units and 239,350 share options were granted to a total of 63 employees. The total share-based compensation expense for the above programs recognized for Q1 2023 is 134 tEUR (Q1 2022: 432 tEUR). Management Incentive Program - Action Network: During the quarter no performance share units or share options were granted under this program. The cost related to the MIP program is recognized as special items and amounts to 52 tEUR in Q1 2023 (Q1 2022: 1,581 tEUR). ===== SIDA 25 ===== Q1 report 2023 Page 24 5. Special items Significant income and expenses, which Better Collective consider non-recurring are presented in the Income state- ment in a separate line item labelled ‘Special items’. The impact of special items is specified as follows: tEUR Q1 2023 Q1 2022 2022 Operating profit 28,083 18,655 70,353 Special Items related to: Special items related to M&A - 350 - 100 - 1,263 Variable payments regarding acquisitions - cost - 93 0 - 192 Variable payments regarding acquisitions - income 0 0 2,467 Special items related to Restructuring - 164 - 0 - 130 Special items related to Divestiture of Assets 0 0 0 Special items related to Management Incentive Program 0 - 1,581 - 936 Special items, total - 607 - 1,681 - 54 Operating profit (EBIT) before special items 28,691 20,336 70,407 Amortization and impairment 3,871 2,289 12,347 Operating profit before amortization and special items (EBITA before special items) 32,561 22,624 82,754 Depreciation 713 487 2,321 Operating profit before depreciation, amortization, and special items (EBITDA before special items) 33,275 23,111 85,075 6. Income tax Total tax for the period is specified as follows: tEUR Q1 2023 Q1 2022 2022 Tax for the period 6,414 4,292 16,888 Tax on other comprehensive income - 1,123 1,201 3,747 Total 5,290 5,493 20,635 Income tax on profit for the period is specified as follows: tEUR Q1 2023 Q1 2022 2022 Deferred tax 2,563 2,149 6,785 Current tax 3,851 2,143 10,153 Adjustment from prior years 0 - 0 - 49 Total 6,414 4,292 16,888 Tax on the profit for the period can be explained as follows: tEUR Q1 2023 Q1 2022 2022 Specification for the period: Calculated 22% tax of the result before tax 6,017 3,967 14,292 Adjustment of the tax rates in foreign subsidiaries relative to the 22% 501 291 1,563 Tax effect of: Special items 0 402 - 83 Special items - taxable items 0 - 379 - 243 Other non-taxable income - 146 - 100 - 150 Other non-deductible costs 42 112 1,558 Adjustment of tax relating to prior periods* 0 - 0 - 49 Total 6,414 4,292 16,888 Effective tax rate 23.5% 23.8% 26.0% ===== SIDA 26 ===== Q1 report 2023 Page 25 7. Intangible assets tEUR Goodwill Domains and websites Accounts and other intangible assets Total Cost or valuation As of January 1, 2023 183,942 460,513 63,705 708,159 Additions 0 3,759 10,142 13,901 Acquisitions through business combinations 0 0 0 0 Transfer 0 0 0 0 Disposals 0 0 0 0 Currency Translation - 1,833 - 4,438 - 459 - 6,731 At March 31, 2023 182,108 459,833 73,388 715,330 Amortization and impairment As of January 1, 2023 0 0 36,688 36,688 Amortization for the period 0 0 3,843 3,843 Currency translation 0 0 - 189 - 189 At March 31, 2023 0 0 40,342 40,342 Net book value at March 31, 2023 182,108 459,833 33,046 674,987 tEUR Goodwill Domains and websites Accounts and other intangible assets Total Cost or valuation As of January 1, 2022 178,182 329,276 36,827 544,285 Additions 0 118,185 26,337 144,522 Acquisitions through business combinations 0 0 0 0 Currency Translation 5,760 13,051 540 19,351 At December 31, 2022 183,942 460,513 63,705 708,159 Amortization and impairment As of January 1, 2022 0 0 24,374 24,374 Amortization for the period 0 0 12,348 12,348 Impairment for the period* 0 0 0 0 Currency translation 0 0 - 33 - 33 At December 31, 2022 0 0 36,688 36,688 Net book value at December 31, 2022 183,942 460,513 27,016 671,471 ===== SIDA 27 ===== Q1 report 2023 Page 26 7. Intangible assets, continued tEUR Goodwill Domains and websites Accounts and other intangible assets Total Cost or valuation As of January 1, 2022 178,182 329,276 36,827 544,285 Additions 0 14,020 12,454 26,474 Acquisitions through business combinations 0 0 0 0 Transfer 0 0 0 0 Disposals 0 0 0 0 Currency Translation 1,930 4,370 179 6,479 At March 31, 2022 180,112 347,666 49,460 577,238 Amortization and impairment As of January 1, 2022 0 0 24,374 24,374 Amortization for the period 0 0 2,302 2,302 Impairment for the period* 0 0 0 0 Amortisation on disposed assets 0 0 0 0 Currency translation 0 0 38 38 At March 31, 2022 0 0 26,714 26,714 Net book value at March 31, 2022 180,112 347,666 22,746 550,525 8. Non-current liabilities and other current financial liabilities Debt to credit institutions: As per March 31, 2023, Better Collective has drawn 201.4 mEUR (2022: 201.7) out of the total committed club facility of 247 mEUR established with Nordea, Nykredit, and Citibank. Lease liabilities: Non-current and current lease liabilities, of 4.9 mEUR (2022: 5.0 mEUR) and 1.3 mEUR (2022: 1.7 mEUR) respectively. Deferred Tax liability: Deferred tax liability as of March 31, 2023, amounted to 76.5 mEUR (2022: 78.2 mEUR). The change from January 1, 2023, originates from amortization of accounts from acquisitions, and deferr ed tax changes in Parent Company and Better Collective US, Inc. Deferred Tax asset: Deferred tax asset as of March 31, 2023, amounted to 10.1 mEUR (2022: 9.1 mEUR), increased from January 1, 2023, due to change in Better Collective US, Inc. and exchange rate change for USD. Contingent Consideration: As per March 31, 2023, there was no contingent consideration after final adjustment and settlement of outstanding pur- chase price related to the acquisition of RiCal LLC. Better Collective paid the final part of the contingent liabilities in Q2 2022. Other financial liabilities: As per March 31, 2023, other financial liabilities amounted to 56.6 mEUR (2022: 49.3 mEUR) due to deferred and variable payments related to acquisitions. The increase from January 1, 2023, is related to the capitalization of media agreements. Fair Value is measured based on level 3 - Valuation techniques. In all material aspects the fair value of the financial assets and liabilities is considered equal to the booked value. 9. Business combinations On April 14, after the end of Q1, 2023 Better Collective completed the acquisition of Skycon Limited (Skycon) for up to 45 mGBP with an initial consideration of 25 mGBP on a cash and debt-free basis. Skycon is a global display advertising company and perfectly complements Better Collective’s Paid Media division. The acquisition is a strateg ic move for Better Collective with significant synergistic opportunities. As per the date of publication of the interim financial state- ments it has not be en possible to obtain sufficient financial data to fulfill reporting requirements according to IFRS3. Therefore, the opening balance, the acquired net assets at the time of the acquisition, goodwill and pro -forma impact on the revenue and profit after tax is not included in these interim financial statements. ===== SIDA 28 ===== Q1 report 2023 Page 27 10. Note to cash flow statement Note tEUR Q1 2023 Q1 2022 2022 Acquisition of business combinations: 9 Net Cash outflow from business combinations at acquisition 0 0 0 Business Combinations deferred payments from current period 0 0 0 Deferred payments - business combinations from prior periods 0 - 2.577 - 14.337 Total cash flow from business combinations 0 - 2.577 - 14.337 Acquisition of intangible assets: 7 Acquisitions through asset transactions - 13.901 - 26.474 - 144.522 Deferred payments related to acquisition value 0 5.359 29.408 Deferred payments - acquisitions from prior periods - 425 - 121 - 121 Intangible assets with no cash flow effect 11.122 5.317 24.325 Other investments - 444 - 5.541 Total cash flow from intangible assets - 3.204 - 16.363 - 96.452 Equity movements with and without cashflow impact Cashflow from Equity movements: Q1 2023 Q1 2022 2022 Equity movements with cashflow impact - from cash flow statement: Capital increase 44 0 618 Treasury shares - 5,903 - 6,595 - 14,250 Transaction cost - 6 - 15 - 28 Total equity movements with cash flow impact - 5,865 - 6,610 - 13,661 Non-cash flow movements on equity: New shares for M&A payments 4,066 4,065 Treasury Shares used for payments 7,769 15,498 Share based payments - warrant expenses with no cash flow effect 2,013 1,713 Total equity movements with no cash flow impact 0 13,848 21,276 Total Transactions with owners - Consolidated statement of changes in equity - 5,865 7,238 7,615 ===== SIDA 29 ===== Q1 report 2023 Page 28 Financial statements for the period January 1 – June 30 Condensed interim income statement – Parent company tEUR Q1 2023 Q1 2022 2022 Revenue 23,699 12,147 65,282 Other operating income 4,015 1,855 14,797 Direct costs related to revenue 4,693 2,625 14,292 Staff costs 8,859 4,094 25,061 Depreciation 178 131 540 Other external expenses 4,417 5,649 17,248 Operating profit before amortization (EBITA) and special items 9,567 1,502 22,939 Amortization 1,594 593 3,875 Operating profit (EBIT) before special items 7,973 909 19,064 Special items, net - 395 - 101 - 1,168 Operating profit 7,578 808 17,896 Financial income 4,003 7,826 72,388 Financial expenses 7,996 1,539 35,057 Profit before tax 3,585 7,095 55,227 Tax on profit for the period 762 1,629 8,279 Profit for the period 2,823 5,467 46,949 Condensed interim statement of other comprehensive income tEUR Q1 2023 Q1 2022 2022 Profit for the period 2,823 5,467 46,949 Other comprehensive income Other comprehensive income to be reclassified to profit or loss in subsequent periods: Currency translation to presentation currency - 641 - 62 22 Income tax 0 0 0 Net other comprehensive income/loss - 641 - 62 22 Total other comprehensive income/(loss) for the period, net of tax 2,182 5,405 46,970 ===== SIDA 30 ===== Q1 report 2023 Page 29 Condensed interim balance sheet – Parent company tEUR Q1 2023 Q1 2022 2022 Assets Non-current assets Intangible assets Domains and websites 168,504 40,205 144,374 Accounts and other intangible assets 21,813 9,800 13,287 Total intangible assets 208,140 50,004 157,662 Property, plant and equipment Right of use assets 283 571 334 Fixtures and fittings, other plant and equipment 488 398 410 Total property, plant and equipment 770 969 744 Financial assets Investments in subsidiaries 156,502 190,863 190,448 Receivables from subsidiaries 268,261 262,603 273,515 Deposits 1,096 174 174 Total financial assets 425,859 453,640 464,137 Total non-current assets 634,769 504,614 622,542 Current assets Trade and other receivables 15,193 8,633 17,163 Receivables from subsidiaries 24,264 24,252 30,229 Tax receivable 6,360 0 5,913 Prepayments 2,580 1,489 2,519 Restricted Cash 0 0 0 Cash 26,592 5,205 8,705 Total current assets 74,989 39,579 64,529 Total assets 709,757 544,193 687,071 tEUR Q1 2023 Q1 2022 2022 Equity and liabilities Equity Share Capital 552 548 551 Share Premium 272,594 271,937 272,550 Currency Translation Reserve - 67 490 574 Treasury shares - 13,577 - 7,385 - 7,669 Retained Earnings 151,161 102,172 145,047 Proposed Dividends 0 0 0 Total equity 410,662 367,763 411,054 Non-current Liabilities Debt to credit institutions 201,383 136,968 201,708 Lease liabilities 0 267 16 Deferred tax liabilities 11,534 2,290 6,141 Other non-current financial liabilities 27,331 1,386 19,543 Total non-current liabilities 240,248 140,911 227,408 Current Liabilities Prepayments received from customers and deferred revenue 1,749 0 1,583 Trade and other payables 3,985 2,830 5,719 Payables to subsidiaries 30,930 16,603 20,822 Corporation tax payable 50 2,287 30 Other current financial liabilities 20,528 13,443 19,045 Debt to credit institutions 1,292 0 1,055 Lease liabilities 314 357 356 Total current liabilities 58,848 35,519 48,609 Total liabilities 299,096 176,430 276,017 Total equity and liabilities 709,757 544,193 687,071 ===== SIDA 31 ===== Q1 report 2023 Page 30 Condensed interim statement of changes in equity – Parent company tEUR Share capital Share premium Currency translation reserve Treasury shares Retained earnings Proposed dividend Total equity As of January 1, 2023 551.49669 272,550 574 - 7,669 145,047 0 411,054 Result for the period 0 0 0 0 2,823 0 2,823 Other comprehensive in- come Currency translation to presentation currency 0 0 - 641 0 0 0 - 641 Tax on other comprehensive income 0 0 0 0 0 0 0 Total other comprehensive income 0 0 - 641 0 0 0 - 641 Total comprehensive income for the year 0 0 - 641 0 2,823 0 2,182 Transactions with owners Capital Increase 0 43 0 0 3,158 0 3,202 Acquisition of treasury shares 0 0 0 - 5,903 0 0 - 5,903 Disposal of treasury shares 0 0 0 0 0 0 0 Share based payments 0 0 0 0 134 0 134 Transaction cost 0 0 0 - 6 - 2 0 - 8 Total transactions with own- ers 0 43 0 - 5,909 3,291 0 - 2,575 At March 31, 2023 552 272,594 - 67 - 13,577 151,161 0 410,662 During the period no dividend was paid. tEUR Share capital Share premium Currency translation reserve Treasury shares Retained earnings Proposed dividend Total equity As of January 1, 2021 546 267,873 552 - 8,074 94,223 0 355,121 Result for the period 0 0 0 0 5,467 0 5,467 Other comprehensive in- come Currency translation to presentation currency 0 0 - 62 0 0 0 - 62 Tax on other comprehensive income 0 0 0 0 0 0 0 Total other comprehensive income 0 0 - 62 0 0 0 - 62 Total comprehensive income for the year 0 0 - 62 0 5,467 0 5,405 Transactions with owners Capital Increase 2 4,064 0 0 0 0 4,066 Acquisition of treasury shares 0 0 0 - 6,595 0 0 - 6,595 Disposal of treasury shares 0 0 0 7,284 484 0 7,769 Share based payments 0 0 0 0 2,013 0 2,013 Transaction cost 0 0 0 0 - 15 0 - 15 Total transactions with own- ers 2 4,064 0 689 2,482 0 7,238 At March 31, 2022 548 271,937 490 - 7,385 102,172 0 367,763 During the period no dividend was paid. ===== SIDA 32 ===== Q1 report 2023 Page 31 tEUR Share capital Share premium Currency translation reserve Treasury shares Retained earnings Proposed dividend Total equity As of January 1, 2022 546 267,873 552 - 8,074 94,223 0 355,121 Result for the period 0 0 0 0 46,949 0 46,949 Other comprehensive in- come Currency translation to presentation currency 0 0 22 0 0 0 22 Tax on other comprehensive income 0 0 0 0 0 0 0 Total other comprehensive income 0 0 22 0 0 0 22 Total comprehensive income for the year 0 0 22 0 46,949 0 46,970 Transactions with owners Capital Increase 5 4,677 0 0 0 0 4,683 Acquisition of treasury shares 0 0 0 - 14,250 0 0 - 14,250 Disposal of treasury shares 0 0 0 14,656 842 0 15,498 Share based payments 0 0 0 0 3,061 0 3,061 Transaction cost 0 0 0 0 - 28 0 - 28 Total transactions with own- ers 5 4,677 0 406 3,875 0 8,963 At December 31, 2022 551 272,550 574 - 7,669 145,047 0 411,054 During the period no dividend was paid. ===== SIDA 33 ===== Q1 report 2023 Page 32 The group uses Alternative Performance Measures not defined under IFRS to give management and investors important information to enable them to fully analyse the Better Collective business and trends. The APMs are not meant to replace but to complement the performance measures defined under IFRS. Note 5 contains a bridge from the APMs to performance measures defined by IFRS. Alternative Performance Measures Alternative Performance Measure Description SCOPE Earnings per share (EPS) Net Profit for the period / (Average number of shares - Average number of treasury shares held by the company) The group reports this APM for users to monitor de- velopment in the net profit per share. Diluted earnings per share Net profit for the period / (Average number of shares + Average number o f outstanding warrants - Average number of treasury shares held by the company) The group reports this APM for users to monitor de- velopment in the net profit per share, assuming full dilution from active warrant programs. Operating profit before amortization (EBITA) Operating profit plus amortizations Better Collective reports this APM to allow monitor- ing and evaluation of the Group’s operational profit- ability. Operating profit before amortizations margin (%) Operating profit before amortizations / reve- nue This APM supports the assessment and monitoring of the Group’s performance and profitability EBITDA before special items EBITDA adjusted for special items This APM supports the assessment and monitoring of the Group’s performance as well as profitability excluding special items that do no stem from ongo- ing operations, providing a more comparable meas- ure over time. Operating profit before amortizations and special items margin (%) Operating profit before amortizations and special items / revenue This APM supports the assessment and monitoring of the Group’s performance as well as profitability excluding special items that do no stem fro m ongo- ing operations, providing a more comparable meas- ure over time. Special items Items that are considered not part of ongoing business Items that are not part of ongoing business, e.g. cost related to M&A and restructuring, adjustments of earn-out payments. Alternative Performance Measure Description SCOPE Net Debt / EBITDA before special items (Interest bearing debt, including earn -outs from acquisitions, excl. contingent considera- tion, minus cash and cash equivalents) / -EBITDA before special items on rolling twelve months basis This ratio is used to describe the horizon for pay back of the interest-bearing debt and measures the leverage of the funding. Liquidity ratio Current Assets / Current Liabilities Measures the ability of the group to pay its current liabilities using current assets. Equity to assets ratio Equity / Total Assets Reported to show how much of the assets in the company is funded by equity Cash conversion rate before special items (Cash flow from operations before special items + Cash from CAPEX) / EBITDA before special items This APM is reported to illustrate the Group’s ability to convert profits to cash NDC New depositing customers A key figure to reflect the Group’s ability to fuel long-term revenue and organic growth Organic Growth Revenue growth as compared to the same pe- riod previous year. Organic growth from ac- quired companies or assets are calculat ed from the date of acquisition measured against the historical baseline performance. Reported to measure the ability to generate growth from existing business Definitions Term Description PPC Pay-Per-Click SEO Search Engine Optimization Sports win margin Sports net player winnings (operators) / sports wagering Sports wagering The value of bets placed by the players Recurring revenue Recurring revenue is a combined set of revenues that is defined as recurring. It includes revenue share income, CPM/Advertising and subscription revenues Board The Board of Directors of the company Executive management Executives that are registered with the Danish Company register Company Better Collective A/S, a company registered under the laws of Denmark Alternative Performance Measures and Definitions ===== SIDA 34 ===== Q1 report 2023 Page 33 Better Collective A/S Toldbodgade 12 1253 Copenhagen K Denmark CVR no 27 65 29 13 +45 29 91 99 65 info@bettercollective.com bettercollective.com