Betfair feels better for slimming down

BETFAIR is starting to reap the benefits of cost-cutting and its focus on attracting more punters in well regulated betting markets such as Britain and Ireland, the online gambling company said yesterday.

Betfair has been forced to defend its strategy after rejecting a £1bn takeover by private equity firm CVC Capital Partners in May.

Revenues fell 13 per cent to £90.4m in the three months to the end of July, reflecting a decision to pull out of markets including Greece, Germany, Cyprus and Spain where regulatory risks or tax hurdles were too high.

The absence of a major international football tournament also depressed revenues compared to last year when the Euro 2012 competition pulled in gamblers.

However, profitability in the form of underlying earnings before interest, tax, depreciation and amortization (Ebitda) rose 16 per cent to £24.9m in the quarter, helped by a cost cutting programme that has seen the company shed 500 jobs from a peak of around 2,300 workers.

“Betfair’s first quarter performance is in line with our plan and leaves us on track to meet our expectations for the full year,” chief executive Breon Corcoran said.

Betfair said an advertising campaign to coincide with the start of the football season last month had driven a 26 per cent increase in customer numbers in Britain.

Betfair is focusing on Britain, Ireland, Denmark, Malta, Gibraltar and the United States and said revenues had grown by more than 10 per cent in these markets last month.