Betfair profit boosted by World Cup betting

Thursday 04 September 2014 08.37
Betfair's CEO Breon Corcoran says company confident on full year expectations
Betfair's CEO Breon Corcoran says company confident on full year expectations

Betting on the soccer World Cup helped to drive quarterly revenues and profit at Betfair to record levels, the online gambling company said today. 

The company said its core profit rose 39% to £34.5m in the three months to the end of July, with revenues up by 30% to £117m. 

"We are encouraged by the performance in the first quarter and the momentum of the business, and accordingly remain confident that we can deliver our expectations for the full year," chief executive Breon Corcoran said in a statement. 

Analysts welcomed the trading statement, which covers the first three months of the company's financial year. 

Betfair operates an exchange that allows gamblers to bet against each other and has sought to attract more mainstream customers by developing products where the bookmaker sets the odds centrally. 

A UK advisory group has urged investors to take the unusual step of rejecting Betfair's annual report at its shareholder meeting later today because of concerns over accounting. 

Pensions and Investment Research Consultants (PIRC) has said that dividends and share buybacks worth more than £60m paid between 2011 and 2013 were "illegal" because Betfair had insufficient distributable reserves to cover them. 

Betfair has accused PIRC of misrepresenting the facts. Corcoran noted that Betfair had itself flagged what he called a "technical issue" in its annual report and had taken action to tackle it. 

"Management moved quickly to resolve the issue and brought it to the attention of shareholders," he said, adding that the company had one of the strongest balance sheets in the industry. 

Betfair has said that funds to cover payouts had been held by a subsidiary rather than at parent company level and that this oversight had now been rectified. It has said it expects strong support from shareholders at its meeting.