BOXXER forms a new partnership with Betfred
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Betfred’s FY2023 revenue up 26% from Lottostar stake
Betfred saw a 26% rise in revenue over the previous year, reaching £908 million for the 12 months ending October 1, 2023.
Betfred’s EBITDA rose 72% to £117 million, driven by acquiring a 51% stake in Lottostar, a South African online betting firm, for £184 million. This added £134 million in revenue and £42 million in profit.
In South Africa, Betfred’s previous acquisitions generated £2 million in revenue in 2023. In the UK, in-person gambling revenue grew 3% to £577 million, with gaming machines and horse racing leading the way. Globally, in-person revenue rose 13% to £17 million.
The online gambling division doubled its revenue to £331 million, largely due to the Lottostar acquisition, with underlying growth at 19% to £197 million. However, Betfred reported a £72 million loss due to exceptional US venture costs.
Surpassing major competitors
Regulus Partners analyst Paul Leyland commented on Betfred’s strong position in the UK market, noting its high revenue per shop compared to other major operators.
He said:
“Betfred now generates more revenue from GB betting shops than Evoke’s William Hill (£535m) and is of comparable size in terms of shop estate to both William Hill and Ladbrokes (the brand, ex Coral). Betfred also now has the strongest revenue per shop of any major operator other than Flutter (Paddy Power).”
He added that despite the challenges facing betting shops, privately-owned Betfred “is likely to continue to push most of the pain onto listed competitors.”
Poised for expansion
Leyland believes Betfred is now “strongly established as a tier two operator” and could see more growth depending on its platform and product execution.
However, he noted the company has been “less successful” in the US, facing £46m in write-offs and write-downs.
Despite this, Leyland praised Betfred for transforming from a traditional UK land-based betting company to a successful omni-channel business, generating over 20% of its revenue from South Africa.
Leyland said:
“The group has used lockdown and regulatory dislocation in the UK land-based betting sector, combined with a lack of land-based focus from major competitors, to deliver growth as well as resilience in its core brand and cash flow base. UK land-based cash flow has also been used to make big bets on proprietary technology capability, South Africa, and the US. So far, only one of these big bets has failed, but Betfred is in good company for trying. Few would have expected Betfred to be in such a strong position in 2024 just five years ago.”
In summary, Betfred’s strategic shifts and resilience amidst industry challenges underscore its evolving role as a formidable player in the global betting landscape.
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