Betfair posts fourth consecutive quarter of double digit growth

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Breon Corcoran

Betfair governance announced its fourth consecutive quarter of double digit growth, as the operator detailed financial performance for Q3 2015 (three month period ended 31 January 2015)

The operator saw group revenues up 20% to £114.6 million (Q3 2014 – £95.4 million), as it reported growth from all product verticals (See graph below). Betfair was further able to record revenue from sustainable markets up 27% to £92.9 million (Q3 2014: 73.2 million).

During the period the operator saw a 35% increase in active player numbers to 760,000 (up 50% in sustainable markets). The operator’s strong focus on in-house product development has paid further dividend with 80% of UK sports betting customers using its mobile product, driving 96% of growth in mobile revenues.

Igaming revenues were up 30%, driven by an improved cross-sell strategy which saw sports betting customers use online casino products for the first time.

The strong revenue growth led to a 17% increase in EBITDA to £23.6m (Q3 FY14: £20.2m). This was despite the introduction of the UK POC charge gaming duty on 1 December 2014, reflecting Betfair’s high level of operational gearing. The impact of this duty in Q3 was approximately £7m.

The EBITDA margin was 20.6% (Q3 FY14: 21.2%). Excluding the impact of the additional gaming duty, the EBITDA margin would have been approximately 27%.

Betfair governance expects full year 2015 EBITDA performance to be between £113 and £118 million.

Breon Corcoran, Betfair’s Chief Executive Officer, commented:

“This was another strong quarter. Betfair has momentum and is continuing to gain share in its key markets by acquiring and retaining customers through product differentiation, attractive odds and generous promotions.

We are now two years into a programme of substantial product and marketing investment and this is delivering sustained growth.

Our in-house development capability is allowing us to develop new products quickly and efficiently. This is particularly evident in mobile, where our proprietary technology gives us an edge in the largest and fastest growing channel.

We are entering one of the key periods in the sporting calendar and are focussed on finishing the year strongly. We recently launched a major new marketing campaign (“Tap Tap Boom”) and our headline Cheltenham Festival offer is Betfair’s most generous yet.

Beyond that, we are set for record levels of political betting around a closely contested UK General Election. Betfair’s Exchange is the go-to platform for those either wishing to have a bet on, or understand the most likely outcome of, the election”

Betfair Q3 2015 Performance Overview

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