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Betfair now operating under a Gibraltar licence

Posted 3/8/11 : Gambling firm's latest results contain a surprise.
 
In its third quarter results released this week, UK-based online betting exchange and gaming operator Betfair announced that its betting exchange will begin operating under a Gibraltar licence from 9 March 2011.
 
The firm currently pays 15 percent tax in the UK on gross profit from betting as opposed to 1 percent when it begins operating under its Gibraltar licence.  The move follows rivals William Hill and Ladbrokes who have already relocated part of its businesses to Gibraltar to avoid the high taxes set by the UK Government.
 
The company intends to continue employing approximately 1200 people at its offices in the UK but announced the move of key technical equipment and 120 staff to new offices in Gibraltar and Dublin as part of a wider restructuring.  The new offices will run in parallel to the existing ones but will be consolidated in 2012.
 
In the year to April 2012, Betfair expects to save GBP 10 million, thereafter further benefits of the move will kick-in and annual savings of GBP 20 million are expected.
 
David Yu, Chief Executive Officer, Betfair commented: “As a global, technology-led betting operator, our new operational base in Ireland and the change to our licensing structure provides us with increased flexibility. It allows us to locate key technical equipment in more efficient locations, to serve our customers better and to compete on the same basis as the majority of operators in the UK online betting market.”
 
Betfair’s third quarter results showed a 20.5 percent drop in poker revenue amounting to GBP 5.2 million, sports revenue up by 8.6 percent to GBP 56.6 million, games up 8.2 percent to GBP 14.3 million and an overall revenue result of GBP 77.0 million representing an increase of 6.2 percent on the same period last year.
 
Commenting on the Q3 performance and current trading, David Yu, Betfair’s Chief Executive Officer, said:
 
“We are pleased with the growth we achieved in the third quarter, especially from football and Games. Marketing efficiency continued its improving trend, resulting in a lower cost per acquisition again this quarter whilst also showing strong growth in active customer numbers.
 
“We have made a good start to Q4. Following the successful migration of our technology infrastructure to our new data centre in Ireland, we are rolling out a planned series of major improvements to our Sports betting product which will help to drive revenue growth in Q4 and into FY12.  We remain confident that we will deliver an outcome for the current financial year within the range of market expectations.”



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