Betfair "continues momentum" as Q2 revenues leap 22%

Betfair this morning posted a 22% rise in Q2 2014 revenues following strong growth in active customers and favourable sporting results delivering “unusually high gross win margins”.

Total revenues for the three months ended 31 October amounted to £119m while the company also revealed its active customer base had risen by 30% year-on-year. The company added that when normalising for high margins, Q2 revenue was up 13%.

The announcement this morning continued Betfair’s recent string of positive financial results and comes on the back of a strong World Cup for the operator where profits increased by 39%.

“Betfair received a boost in Q1 from a strong World Cup performance and our focus in the second quarter has been on maintaining this momentum,” Breon Corcoran, Betfair CEO, said.

The firm disclosed the figures prior to an investor and analyst briefing later today where Corcoran is expected to discuss the firm’s technological capabilities including its Cash Out and Price Rush products which he said were “changing the way our customers bet”.

Barclays analyst Patrick Coffey said that after recording total H1 revenues of £236m the company was on track to deliver H1 EBITDA of around £62m, some 7% higher than forecast.

“There is nothing to suggest this beat shouldn’t flow through to further profitability and be read across for the full year,” Coffey said.

Analyst Ivor Jones at Numis Securities said Betfair had enjoyed a “good run” before an increase in competitive pressures as the UK’s proposed Point of Consumption duty is introduced.

Betfair’s share price rose almost 3% to 1245p on the back of the announcement this morning.