Betfair says Olympics put dent in its revenue

THE POPULARITY of the Olympics sapped interest in betting on sports such as soccer and horse racing in recent weeks, online gambling exchange Betfair said yesterday, eating into revenues at the company which offers an alternative to traditional bookmakers.

Betfair, set up 12 years ago, said like-for-like revenue adjusted for the impact of regulation was only marginally higher since the start of August against the same period a year before.

That compares with core revenue growth of 13 per cent to £91.6 million in the three months through July, helped by the Euro 2012 soccer tournament, although the company said its performance was broadly in line with expectations for the year to date, thanks to its strong first quarter.

Before the Olympics, bookmakers had been cautious about the impact of the Games, noting that many of the sports were not big betting markets. That seems to have been the Betfair experience, although punters staked more cash than before on the event.

“We had our best-ever Olympics with over twice as many customers betting on the Games as they did in Beijing,” chief financial officer Stephen Morana said, although he conceded that activity overall had been hit.

The company also announced that Mr Morana would leave his position as chief financial officer once a successor had been found, having served as interim chief executive for several months and having been with the business for a decade.

Breon Corcoran, previously chief operating officer at Irish bookmaker Paddy Power, took over as chief executive last month.

Mr Corcoran will have to deal with regulatory issues in a number of continental European markets and ensure revenue growth picks up again. He said he would give more details on his plans at the company’s interim results in December.

Betfair has lodged a formal complaint with the European Commission over new Cypriot gambling legislation, which it says could lead to betting exchanges being prevented from operating in their current format in Cyprus.

In Germany, a 5 per cent federal turnover tax introduced in July would make its exchange model unviable if applied, the company warned. – (Reuters)