* Core sales down 7 percent to 80.8 mln stg, in line with
* Says Q2 starts well, August core sales up 12 percent
* Says comfortable with estimates for full year 2012
* Shares rise 7.8 percent, among top FTSE 250 risers
(Adds executive comment, detail, updates shares)
By Adveith Nair
LONDON, Sept 6 Betfair Group , the
world's largest betting exchange, said its second quarter had
started strongly, following an expected drop in its
first-quarter revenue when it faced a tough comparative period.
Trading in the second quarter has been encouraging,
including a good start to the football season, the company said
Chief financial officer Stephen Morana told reporters he was
comfortable with estimates for the full year of about 346
million pounds ($557 million) revenue from the company's core
business and 390 million in total sales.
"Core business revenue of 346 million pounds equates to
between 8-10 percent growth for the rest of the year," he added.
"We were 12 percent in August and are pretty comfortable that
the signs are positive for the rest of the year."
Core Betfair revenue includes sales from the company's
betting exchange plus other sports betting products.
Shares in the company rose 7.8 percent to 677 pence at 0917
GMT on Tuesday, and were among the top percentage gainers on
Britain's FTSE 250 index.
Betfair, founded 10 years ago by one-time professional
gambler Andrew Black and former JP Morgan trader Edward Wray,
said first-quarter revenue fell 7 percent to 80.8 million pounds
($130.1 million) as it faced a tough comparative period
incorporating last year's soccer World Cup.
That was in line with the consensus forecast of 79 million
pounds, according to data provided by the company.
Betfair acts as an intermediary between gamblers wanting to
place a bet or offer odds to others, taking commission on their
winnings. Last year, it matched more than 900 million bets.
The company has, however, this year added a traditional
bookmaking service to its offering, which it describes as its
"risk sports" product.
A steep fall in revenue from risk sports products in May
contributed to the lower first quarter sales, but the company
said margins in risk products had since May returned to
"A couple of other companies have also spoken about May
just being a rather odd month where lots of favourites came in,"
Morana said. "Especially in football - it was the final month of
the season across Europe and it seemed to me game after game the
favourites kept on winning."
Betfair shares have been hindered by concern over changes to
online gambling laws in countries such as Spain, Greece and
Germany, and intensifying online competition from traditional
bookmakers such as William Hill and Ladbrokes .
The stock has fallen more than 60 percent from highs of more
than 1,600 pence it touched shortly after the company listed
Chief executive David Yu said on the call while some
countries including Italy and Denmark were progressing with
sensible frameworks, others, including Germany, had introduced
proposals that were "unworkable" for the entire industry.
Germany may have to relax its draft gambling law to give
online gaming firms more scope to operate following criticism
from Britain and Malta and rulings by the European Union's top
"The regulatory challenge for the industry is to ensure that
licensing frameworks that come into place in each European state
are commercially viable for the operators," Yu said.
"If there is a situation where national laws are
incompatible with European laws, we will certainly want to
($1 = 0.621 British Pounds)
(Additional reporting by and Matt Scuffham; Editing by Rosalba
O'Brien and Hans-Juergen Peters)