BetMakers on ‘path to profitability’ with restructuring and cost reductions

Australia-based international betting solutions provider BetMakers Technology Group has detailed progress on its operational restructure, as the firm seeks to streamline its business model.

The company updated its ASX investors that the operational review it has been undertaking over the past four months will lead to a reduction in operating costs – from AUS$91.5m in H1 FY2023 (June 2022-June 2024) to $70m from the first quarter of FY2024. 

This has been attributed to a restructuring of global operations and technology. Notable changes have included a 23% reduction in employee numbers by Q1 2024 to 440, compared to 568 as of 31 December 2022.

Jake Henson, BetMakers CEO, said: “The company’s cost base has been reset on the back of the deployment of proprietary technology and a strategic review of our operating model.

“BetMakers is committed to providing long-term value to shareholders and this restructuring is an essential step towards achieving that goal. The changes made aim to provide the business with a clear path to profitability, while also providing a more streamlined operating structure to maximise future growth opportunities. 

“For our customers, who are at the core of our value creation process, we are committed to delivering best-in-class levels of service and quality. The investments in our technology and the extended roll out of our platforms and products into all regions both domestically and globally will support this ongoing commitment.”

From its original founding market in the US, BetMakers has built up a presence in the high-value betting markets of Europe and North America. Notable clients of the firm in these regions are kwiff in the UK and newly launched MonmouthBet in New Jersey.

The groups’ services are divided between its Global Betting, Global Racing and Globe Tote divisions, with the acquisition of Punting Form further strengthening its horse racing operations last year.

In its last financial update covering 1H23 (1 July-31 December 2022), the firm reported revenue growth of 7.5% to $46.7m (1H22: $43.5m). However, this was accompanied by decline in EBITDA from $2.3m to a loss of $15.4m.

To work towards profitability, the company has underlined a streamline of its operational infrastructure and reduction of costs as a key priority. 

This has included consideration of software offerings, leveraging technology monitoring and reporting, with the total cost of the ‘global efficiencies programme’ estimated between $2m to $2.5m.

Matt Davey, BetMakers Chairman, remarked: “As detailed when we presented our Q2 FY23 results, and reiterated in our Q3 FY23 announcement, the company is focused on delivering operational efficiencies, simplifying our global operating model, and positioning the company for profitable growth. 

“Management and our global team have delivered on this promise, and we now expect the company to be well positioned to drive operating leverage as we expand our revenue base.

“Importantly, this restructure will allow increased focus on our core platform and products, improving the benefits and value we can deliver to our domestic and international customers.”