Betfred’s Strategic Expansion Leads to Record Revenues in 2023
British Omnichannel gaming operator Betfred has achieved record financial performance for the fiscal year 2023, reporting revenues of £577 million (US$747.71m). This notable increase is attributed to strategic acquisitions and expansions, particularly the acquisition of a controlling stake in South African iGaming operator LottoStar.
Significant EBITDA Growth
Betfred’s EBITDA for FY23 soared by 72 percent year-on-year, reaching £117 million (US$151.61m). This growth reflects the company’s effective strategic decisions and operational efficiencies over the past year.
Key Acquisition of LottoStar
A pivotal factor in Betfred’s success was the acquisition of a 51 percent stake in LottoStar for £184 million (US$238.44m) in June 2022.
LottoStar, South Africa’s largest online gambling operator, significantly boosted Betfred’s financial results. The acquisition added £134 million (US$173.64m) in revenue and £42 million (US$54.42m) in net profit for the most recent accounting year.
Historical Background and Expansion
Founded in 1967 by brothers Fred and Peter Done, Betfred started with a single betting shop in Salford, Greater Manchester.
Over the years, it has grown into a major player in the betting industry, operating 53 retail outlets in South Africa and holding a substantial presence in the iGaming sector through Betting World and Sepels Sportsbet.
Enhanced Omnichannel Status
The significant expansion into the South African market has elevated Betfred’s status as an Omnichannel operator, integrating both physical and online gambling platforms. This strategic move has allowed Betfred to diversify its revenue streams and strengthen its market position.
Challenges and Strategic Retreats
Despite the successes, not all of Betfred’s strategic moves have been profitable. The company’s withdrawal from the U.S. market resulted in a substantial cost of £46 million (US$59.61m).
Additionally, while overall revenues were impressive, the company reported a nominal year-end loss of £72 million (US$93.3m), partly due to its investments and strategic shifts.
Industry Expert Insights
Paul Leyland of Regulus Partners, a prominent gambling industry advisor, highlighted Betfred’s transformation over the past five years. He noted, “Betfred has transformed itself from a highly traditional UK land-based betting company to a successful Omnichannel business with over 20 percent of revenue generated elsewhere. Five-years-ago few would have expected Betfred to be in such a strong position.”
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