Betfair (LSE: BET) also announces review of its dividend policy.
Betfair (LSE: BET) this morning revealed plans to reinvigorate its business, with three key elements: to focus on regulated jurisdictions, to invest in the brand, and to introduce greater accountability.
With this three-point plan, the gambling firm hopes to increase revenue sustainability, enhance its competition position and drive growth, and become a leaner and more dynamic business.
The news was announced within its interim results, which saw a 22% decline in underlying pre-tax profit to £21m from £27m at the same stage last year. EBITDA also dropped off, by 2% to £42.3m against £43.1m, while basic earnings per share was affected to the tune of 25%, slipping from 23.2p at H1 FY12 to 17.4p today.
However, group revenue increased 5% to £200.6m, and over £20m of savings have been identified to date, while Betfair has confirmed it is "exiting from investments in LMAX and Kabam".
Chief executive officer Breon Corcoran, who joined Betfair from Paddy Power on 1 August this year, commented:
"This is a solid set of results for the first six months of the year... The review we have carried out over the past four months has demonstrated a number of strengths. Betfair has a unique product offering, strong brand affinity and scale in the UK. However, we have also identified a number of areas requiring change and fixing these will take time.
"Recent regulatory developments have been challenging and we are reducing our exposure to markets with an uncertain regulatory future. We will focus investment within regulated markets with sustainable revenues. Creating a simpler product that retains the key advantages of the exchange, combined with investment to return the brand to its previously strong position, will allow us to increase our audience and accelerate revenue growth."
The gambling firm also announced a review of its dividend policy, with the medium-term payout target "increased to 40% of group profit after tax". Shares were up marginally on the news, around 0.5% at the time of writing, while the interim dividend has been increased by 25% to 4p per share.
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> Sam does not own shares in any of the companies mentioned.