Tech-powered media company The Arena Group Holdings (AREN), which owns and operates 35 properties and more than 200 brands including Sports Illustrated, TheStreet and HubPages, reported total annual revenues increased 48% in 2021 compared to the previous year and fourth-quarter revenues jumped 44% compared to the same period in 2020, according to financial results released for the period ending Dec. 31.
Fourth-quarter revenue increased to $61.2 million from $42.4 million in 2020, while annual revenue rose to $189.1 million compared to $128 million for the previous year. Gross profit percentage improved to 56% in the quarter compared to 37% in the same period the previous year.
Adjusted EBITDA improved to a positive $1.1 million for the fourth quarter of 2021 as compared to a loss of $2.1 million for the same period in 2020. Adjusted EBITDA improved to a loss of $12.1 million for fiscal year 2021 as compared to a loss of $23.2 million for fiscal 2020.
Ross Levinsohn, chairman and chief executive officer of The Arena Group, said in a statement that "2021 was a watershed year for our company, our employees, partners and stockholders with record revenue growth, operational efficiency, a national listing of our common stock on the NYSE American and transformative acquisitions."
Levinsohn added that "It was also a year of important investment, as we developed, streamlined, and validated our technology stack and our strategic approach, establishing a scalable platform for profitable growth."
The Arena Group in January signed a non-binding letter of intent to acquire AMG Parade, a premium multimedia content company reaching more than 250 million people each month with lifestyle, celebrity, food, health & wellness, sports, and outdoor verticals including the Parade Media, AMG/Parade Sports, Relish, Spry Living and other lifestyle and outdoor brands. The company expects to complete the acquisition shortly.
Accelerating Momentum
"We have clearly proven our ability to drive revenue and audience growth and expand revenue streams, leading to margin expansion across all our properties," Levinsohn said. "Our momentum in Q1 of 2022 has accelerated, with further growth across almost every sector and we are well positioned to continue to expand with our new lifestyle vertical, anchored by the popular brands established by AMG Parade (which is anticipated to close shortly)," he said.
In February, the company recorded more than 111 million unique visitors, according to Comscore. The Arena Group reached the No. 34 spot in the U.S. rankings, up 40 spots from February 2021, and its sports vertical, led by Sports Illustrated, reached No. 4 in the sports category. Also in February, the Sports Illustrated Media Group reached more than 86 million digital users, more than tripling the amount year-over-year.
Sports Illustrated now has the No. 1 share of voice on Facebook among sports publishers for linked stories, according to data from CrowdTangle.
"Our highly efficient, data driven, technology-powered media platform is now proven and operating at scale, with significant room for expansion both organically and inorganically," Levinsohn said. "We continue to add highly relevant content to our platform, leveraging brand recognition, strong audience development capabilities and a unified backend system driving efficiency and margins to create value for our partners across our ecosystem," he said.
Since the departure of Jim Cramer from TheStreet in October 2021, The Arena Group has grown users at the financial site by 249% to more than 17 million monthly unique visitors, according to Comscore data recently released in February and has seen its engagements at Facebook grow by more than 520% year-over-year for the first two months of 2022, according to data from ListenFirst.
The company's "The Arena Group ‘Playbook,’" its plan to feature premium content and expert analysis, as well as audience and editorial strategies designed to efficiently deliver robust experiences to audiences across platforms, has driven significant recent growth for Sports Illustrated, The Spun, TheStreet and PetHelpful, with plans to roll out across additional properties and publisher partners in the coming year.
Stock Uplisted
In the first quarter of 2022, The Arena Group uplisted its common stock to the NYSE American under the symbol "AREN." Simultaneous with the uplisting, the company completed an underwritten public offering of 4,181,603 shares of its common stock, which included the partial exercise of the underwriter’s overallotment, at a public offering price of $8.25 per share. This resulted in net proceeds to The Arena Group of $31.5 million, after deducting underwriting discounts and commissions and other offering expenses.
The company reported an improved net loss of $19.1 million for the quarter compared to $22 million for the same period in 2020, while an annual net loss remained relatively flat year-over-year at $89.9 million for fiscal 2021 as compared to $89.2 million for the previous fiscal year. Non-cash charges represented 76% of the annual net loss for 2021.
