TIDMBET
RNS Number : 5886G
Betfair Group PLC
05 March 2015
5 March 2015
Betfair Group plc ("Betfair")
Q3 FY15 Trading Update
Betfair (LSE:BET) today announces its trading update and KPIs
for the three month period ended 31 January 2015 ("Q3 FY15").
Comparatives relate to Q3 FY14.
-- Revenue up 20% to GBP114.6m, representing the fourth
consecutive quarter of double-digit growth
-- Revenue from sustainable markets up 27% to GBP92.9m
-- Number of active customers up 35% to 760,000 (up 50% in sustainable markets)
-- 80% of UK Sportsbook customers are now using mobile, driving 96% growth in mobile revenues
-- EBITDA up 17% to GBP23.6m (up 51% excluding UK POC duty)
-- Acquired HRTV and entered into a long-term content deal in the US
-- Full-year FY15 EBITDA now expected to be between GBP113m and GBP118m
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.
The strong Q3 performance and the continuing momentum we are
carrying into the final quarter mean we now expect full-year EBITDA
of between GBP113m and GBP118m".
Net gaming revenue (GBPm) Q3 Q3
FY15 FY14 Change
%
------------------------------ ------ ------ ---------------
Sports 76.7 66.2 +16%
Gaming 24.1 18.5 +30%
Betfair US 13.5 10.4 +30%
Management of customer funds 0.3 0.3 -
------ ------ ---------------
Total 114.6 95.4 +20%
------------------------------ ------ ------ ---------------
Net gaming revenue (GBPm) Q3 Q3 Change
FY15 FY14 %
--------------------------- ------ ------ -------
Sustainable markets 92.9 73.2 +27%
Other markets 21.7 22.2 -2%
------ ------ -------
Total 114.6 95.4 +20%
--------------------------- ------ ------ -------
Actives ('000) Q3 Q3 Change
FY15 FY14 %
--------------------- ------ ------ -------
Sustainable markets 638 424 +50%
Other markets 122 137 -11%
------ ------ -------
Total 760 561 +35%
--------------------- ------ ------ -------
Revenue was up 20% to GBP114.6m (Q3 FY14: GBP95.4m) driven by
double-digit growth in Sports, Gaming and Betfair US.
Revenue from sustainable markets (UK, Ireland, USA, Italy,
Denmark, Malta, Spain and Bulgaria) was up 27% to GBP92.9m (Q3
FY14: GBP73.2m), driven by a 50% increase in the number of active
customers. Revenue from other markets was down 2% year on year in
line with our strategy of focusing investment in regulated
jurisdictions.
Sports revenue growth (+16%) continued to be led by mobile. In
recent months, 80% of UK Sportsbook customers placed a bet using a
mobile device and the channel accounted for the majority of new
activations.
The Cheltenham Festival takes place next week and is a key event
for both acquiring new customers and increasing engagement with
existing users. Our headline promotion is a free bet on every
winning selection backed at odds of 3/1 or higher on all races.
Additionally, on day one we are enhancing the offer to three free
bets, which is our most generous offer yet at the Festival. This is
supported by our new "Tap Tap Boom" advertising campaign, which
focuses on the simplicity of our mobile products and highlights our
latest promotions.
We continue to invest in our product and ahead of the Festival
have extended our flagship Cash Out functionality to horseracing on
both the Exchange and Sportsbook. This allows customers to Cash Out
their bets during a race and further differentiates our customer
proposition.
Gaming revenue was up 30%, driven by an increase in the number
of Sports customers using these products for the first time and by
increased mobile usage. In January, for the first time, the
majority of Gaming customers used mobile, reflecting product
improvements and increased cross-sell of mobile Sports
customers.
Betfair US revenue was up 25% (constant currency), driven by a
17% (constant currency) increase in TVG revenue and growth in our
online casino in New Jersey. TVG recently acquired the HRTV
horseracing television network and entered into a long term content
rights agreement with the Stronach Group, which operates the Santa
Anita, Gulfstream Park, Pimlico, Golden Gate Fields and Laurel Park
race tracks. This strengthens TVG's ability to drive incremental
volume on its advanced deposit wagering platform and is expected to
lead to additional advertising and distribution opportunities.
EBITDA
The strong revenue growth led to a 17% increase in EBITDA to
GBP23.6m (Q3 FY14: GBP20.2m). This was despite the introduction of
the point of consumption based gaming duty in the UK on 1 December
2014, reflecting Betfair's high level of operational gearing. The
impact of this duty in Q3 was approximately GBP7m.
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%.
Return of cash
In December 2014, we announced the return of GBP200m of capital
to shareholders and subsequent consolidation of our share capital
on a 7 for 8 basis. This was completed in January and as at 31
January 2015 our cash balance was GBP99.7m, excluding customer
funds held off balance sheet in trust, and there were 92.5m shares
outstanding.
Conference call
Breon Corcoran, Chief Executive Officer, and Alex Gersh, Chief
Financial Officer, will host a conference call for investors and
analysts at 8:15 a.m. (GMT) today. Access details for the call are
as follows:
Access Number: +44 844 800 3850
Passcode: 291 263 28
A replay of the call will be available later today on our
corporate website:
http://corporate.betfair.com/investor-relations/results-and-presentations/results-centre.aspx
For more information, please contact:
Media: Investors / Analysts:
James Midmer Victoria Palmer-Moore Paul Rushton
Corporate Communications Powerscourt Investor Relations
Tel: +44 20 8834 6843 Tel: +44 20 7250 1446 Tel: +44 20 8834
james.midmer@betfair.com vpm@powerscourt-group.com 6139
paul.rushton@betfair.com
This information is provided by RNS
The company news service from the London Stock Exchange
END
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