Published On: Wed, Nov 25th, 2015

Betfair Releases Strong Half Year Results


Shares in Betfair have risen by 162% in the last 12 months.

Betfair PLC released its 6 months interim trading results on Wednesday showing revenue and profitability of the business had increased in comparison to the prior years period despite it containing the World Cup.

The company saw its revenue jump by 15% to £274.4 million from 237.6 million in the prior years H1 results. This resulted in a 12% boost in operating profit to 67.2 million from 59.9 million which the company attributed to its focus on sustainable markets, growing international business and investment in its products.

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

“Betfair traded strongly in its key markets throughout the first half of FY16. These results, which came against a tough comparative period featuring last year’s football World Cup, are ahead of our original expectations and demonstrate the Group’s continued strong momentum.

Our strategy of focusing investment in markets with good regulatory visibility continues to pay off. Betfair’s relatively low exposure to unregulated jurisdictions meant that even though revenue decline in these markets accelerated, primarily due to the impact of suspending operations in Portugal, it was more than offset by growth in sustainable markets.

Betfair’s two largest markets, the UK and the USA, accounted for most of this growth. Our Sportsbook continued to take market share, with stakes up 93% year on year. In the US, TVG’s acquisition of HRTV in February 2015 gave it greater distribution and access to premium content, which, together with the business’ existing momentum, resulted in H1 revenue growth of 38%.

Our markets remain highly competitive and, alongside our strategy of giving customers generous pricing and promotions, we believe it is essential that we continue to invest. Over the last twelve months we have added more than 100 people to our product development teams, and, adjusting for the World Cup, our sales and marketing costs were up 13%.

Notwithstanding this investment, and the significant burden of higher gaming taxes, strong revenue growth and continued cost discipline resulted in 9% higher EBITDA.”

The Board declared an interim dividend of 15.0 pence per share (H1 FY15: 9.0 pence) up 67% which they said reflects the increased profitability of the business, continued strong cash flow and dividend policy of targeting a payout ratio of approximately 50% in the medium term.

The dividend is to be paid on 15 January 2016 to holders of relevant shares on the register at 18 December 2015.

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