Exchange betting specialists Betfair saw its shares rise nearly 18% on Thursday after posting better than expected fiscal Q3 results.
For the three months ending Jan. 31, Betfair revenue rose 20% to £114.6m, the fourth consecutive quarter of double-digit growth. Earnings rose 17% to £23.6m, despite a £7m hit from the UK’s new 15% online point-of-consumption tax, which kicked in Dec. 1.
Betfair CEO Breon Corcoran (pictured) said the company had “momentum” and was focused on finishing its fiscal year strongly. Previous full-year fiscal 2015 earnings estimates were in the range of £97m to £103m but Betfair now expects the numbers to come in between £113m and £118m.
Sports betting revenue was up 16% to £76.7m, driven by a strong mobile performance. Four of five Betfair sports bettors are now using the company’s mobile channel, resulting in a 96% growth in mobile betting revenue.
Mobile also helped drive a 30% rise in gaming revenue to £24.1m. Betfair notched a first in January, during which mobile bettors accounted for the majority of gaming revenue. Gaming revenue also benefited from better cross-sell with sports bettors.
Betfair US revenue rose 30% to £13.5m, spurred by a 17% gain in horseracing operation TVG. Betfair has greater expectations for its US division following last month’s acquisition of the HRTV network from the Stronach Group. Betfair didn’t break out separate revenue stats for its New Jersey online casino product.
Revenue from ‘sustainable’ aka the regulated markets of UK, Ireland, USA, Italy, Denmark, Malta, Spain and Bulgaria was up 27% to £92.9m, while revenue from other markets fell 2% to £21.7m. Active customer ranks in sustainable markets rose 50% while other markets fell 11%.
Betfair’s shares closed Thursday’s trading at £21.05, providing validation for board members’ 2013 decision to reject a takeover bid from CVC Capital Partners, which had offered £9.50 per share.
