6th Mar 2014 09:13
LONDON (Alliance News) - Betfair Group PLC saw its shares rise Thursday after it said customer numbers, revenues and profits all rose in its fiscal third quarter and it gave a positive outlook, partly thanks to soaring growth in mobile betting.
The online betting company, which has just gone through a restructuring after hitting a tough patch, said revenues were up 5% to GBP95.4 million in the three months to end-January, driven by strong growth in the markets that is has deemed sustainable after its revamp. Its earnings before interest, tax, depreciation and amortisation, excluding certain items and foreign exchange losses, rose 28% to GBP20.2 million, from GBP15.8 million.
It said it now expects its underlying Ebitda for the year to end-April to come in towards the top end of its previously guided range of between GBP82 million and GBP87 million, helped by the fact that its investments in Italy and New Jersey will come in towards the lower end of its predicted range of GBP5 million to GBP10 million.
The third quarter growth marked an improvement from the first half of the financial year when profits rose due to cost cutting, but revenues fell 6%. Its underlying Ebitda grew 16% in the first six months of the year, below the level in the most recent quarter.
Betfair has exited markets including Greece, Germany and Spain following regulatory changes, and is now focused on regulated markets like the UK and Gibraltar, as well as the new markets opening up in the US.
It said the number of active users in its "sustainable" markets rose to 26% to 424,000, driven mainly by its new sportsbook offering, while active users in other markets declines 23% to 137,000.
"Betfair had a good quarter against all key metrics, with growth in customer numbers, revenues and profits. We are now competing more aggressively and are investing heavily in customer marketing and product development," Betfair Chief Executive Breon Corcoran said in a statement.
Its mobile revenue rose 68%, and now represents 60% of total sportsbook revenue.
Betfair has revamped its sportbook, integrating it with its exchange and leveraging the two products. Sportsbook revenues rose 27% in the quarter, while exchange revenues were up 1% and gaming revenues were up 3%. US revenues rose 24%.
The CEO said that the company will double its television presence in 2014 and it has just signed a deal with ITV PLC to become a so-called "gold" partner for the channel's football coverage over the next 15 months, including the World Cup and Champions League.
Betfair shares were up 2.5% at 1,160.00 pence early Thursday, one of the top gainers on the FTSE 250.
By Steve McGrath; [email protected]; @stevemcgrath1
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