ONE Championship continues to remain optimistic on its profitability targets even after the Asian mixed martial arts promoter more than doubled its annual losses in 2021.

Recent filings to Singapore’s Accounting and Corporate Regulatory Authority (ACRA) show that ONE’s annual losses for 2021 jumped 125% to $111 million compared to the same period in 2020. The firm’s net cash flow used in operating losses also grew 61.9% to $63 million in 2021 from $38.2 million in 2020.

ONE’s revenue — from event ticketing, live broadcast, sponsorships digital platform and merchandise — grew 19.1% to $67.7 million in 2021 from $56.8 million in 2020. The Singapore-based firm, however, continues to recognise non-cash components as revenue, which may involve barter of products or services in-kind.

A heavy majority of ONE’s revenue also comprises the transfer of goods or services “over time”.

Source: ONEFC’s FY2021 report.

Out of ONE’s total 2021 revenue of $67.7 million, over 97% ($66.2 million) comprises the transfer of goods or services in the future. The largest contributor of ONE’s revenue currently comes from broadcasting, which would include its recent deal with Amazon Prime Video to air 12 of its live events to viewers in the US and Canada.

Profitability soon?

ONE Championship expects to hit at least $80 million in revenue this year and turn profitable in the next three years, ONE’s chief executive, Chatri Sityodong had said at the Milken Institute Asia Summit this week.

These were echoed by ONE’s chief financial officer Hua Fung Teh, who told Nikkei Asia recently that the firm’s business model is “inherently profitable”, and that “revenue will grow very quickly” once ONE has strong brand recognition and content to lure viewers in overseas markets.

Since the beginning of 2022, ONE has gradually resumed live events in Singapore as COVID-related social restrictions began to ease in the country. It is also resuming events in other Asian markets. Earlier this month, ONE announced that it would host 52 weekly events at Lumpinee Stadium, Bangkok in 2023.

“2020 was an anomaly due to the restrictions imposed upon us by the global pandemic as we were unable to host any live events for several months. In 2021, as the restrictions were eased, we were able to resume investment in our core product of live events. We’ve gone from strength to strength in 2022 with multiple partnerships launched across the world that will have a significant impact on our future revenue and profitability as we continue to grow our brand globally,” wrote a ONE Championship spokesperson in a statement to DealStreetAsia.

“We continue to grow our revenue year-on-year and enhance our cost efficiencies. We’re confident that we’re on a clear path to build a sustainable and profitable business in the long term,” the spokesperson added.

ONE Championship grew its cash and cash equivalents to $164.8 million in 2021, up by 109% from $78.5 million the year before. The firm last closed a $150 million equity round led by Qatar Investment Authority (QIA) and Guggenheim Investments in December last year, pegging the firm’s valuation at about $1.2 billion.

ONE boasts a solid rack of investors on its cap table, including blue chip names like Sequoia Capital India, Sequoia Capital’s US growth fund, Vulcan Capital and Heliconia Capital.

Last month, ONE Championship redomiciled its entity to the Cayman Islands, reportedly due to impending plans to IPO.

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