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25 Nov 2015

Interim results for the six months ended 31 October 2015

Six months ended 31 October H1 FY16
£m		 H1 FY15
£m		Change
%
Revenue 274.4 237.6 +15%
EBITDA 80.5 73.9 +9%
Operating profit 67.2 59.9 +12%
Earnings per share 60.3p 55.0p +10%
Underlying earnings per share 1 60.3p 48.9p +23%
Dividend per share 15.0p 9.0p +67%

H1 highlights

  • Revenue up 15% to £274.4m against a comparative period containing the World Cup
  • Growth driven by Sportsbook, with volumes up 93%
  • EBITDA up 9% to £80.5m, notwithstanding £26.8m of additional POC tax
  • Interim dividend up 67% to 15.0 pence per share reflecting continued strong cash flow and the higher payout ratio target of 50% introduced in December 2014

Q2 highlights

  • Number of active customers in sustainable markets up 31%
  • Revenue up 16%, including a 25% increase in sustainable markets
  • Sustainable revenue mix now 88% (Q2 FY15: 82%)
  • Mobile remains the key growth driver across all products and now represents 76% of Sportsbook revenues
  • Betfair US revenue up 35% following the successful integration of HRTV and strong casino growth

Recommended merger with Paddy Power

  • All relevant regulatory filings have been submitted
  • Shareholder documentation will be published on 27 November 2015
  • On track for completion in Q1 2016, subject to shareholder and regulatory approval

Breon Corcoran, Betfair's Chief Executive Officer, said:

'Betfair traded strongly in its key markets throughout the first half of FY16. These results, which came against a tough comparative period featuring last year's football World Cup, are ahead of our original expectations and demonstrate the Group's continued strong momentum.

Our strategy of focusing investment in markets with good regulatory visibility continues to pay off. Betfair's relatively low exposure to unregulated jurisdictions meant that even though revenue decline in these markets accelerated, primarily due to the impact of suspending operations in Portugal, it was more than offset by growth in sustainable markets.

Betfair's two largest markets, the UK and the USA, accounted for most of this growth. Our Sportsbook continued to take market share, with stakes up 93% year on year. In the US, TVG's acquisition of HRTV in February 2015 gave it greater distribution and access to premium content, which, together with the business' existing momentum, resulted in H1 revenue growth of 38%.

Our markets remain highly competitive and, alongside our strategy of giving customers generous pricing and promotions, we believe it is essential that we continue to invest. Over the last twelve months we have added more than 100 people to our product development teams, and, adjusting for the World Cup, our sales and marketing costs were up 13%.

Notwithstanding this investment, and the significant burden of higher gaming taxes, strong revenue growth and continued cost discipline resulted in 9% higher EBITDA.'

1Underlying figures in FY15 exclude the profit on disposal of the Group's share of Betfair Australia. A reconciliation of reported figures to underlying figures is set out on page 7.

For more information, please contact:

Analyst and investor results webcast

There will be a live webcast of the results presentation at 10:00 a.m. GMT. Please pre-register for access to the webcast by visiting the Group website (http://corporate.betfair.com). A copy of the webcast and slide presentation given at the meeting will be available on the Group's website later today.

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