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  • Q3 FY24: BetMakers shares drop 11% amid year-on-year revenue reduction
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BetMakers’ revenue fell 4.1% year-on-year in Q3 of its financial year 2024 (three months ended 31 March) to A$22.3m (€13.7m).

The decline drove a reduction in the betting supplier’s share price of around 11% in early trading.

BetMakers said the revenue, which dropped from A$23.3m in Q3 FY23, was down due to “soft conditions in the Australian wagering market,” where the supplier continues to generate around 25% of its income.

The quarter represented a “challenging period for Australian operators”, BetMakers added, due to the competitive landscape in Australia alongside regulatory and tax-related headwinds.

BetMakers’ revenue is directly linked to that of its customers, as it holds revenue share agreements with around 30 different wagering platforms.

Underlying EBITDA for the quarter came in at a A$2.5m loss, compared to a A$4.1m loss in Q3 FY23. The company did register positive net operating cash flows of A$1m, however.

The EBITDA improvement was driven by continuing reductions in the company’s operating costs, which fell by 8.2% quarter-over-quarter. 

BetMakers said it plans to achieve further cost reductions in the current quarter.

The results brought revenue for the first nine months of FY24 to A$73.7m, up 5.3% on the same period in the previous year.

Key Q3 events

BetMakers experienced significant changes during the latest quarter, including the signing of new agreements with PA Betting Services, Kambi Group and Gaming Innovation Group (GIG).

Following the end of the quarter, the business also announced it had entered into a binding agreement to acquire the assets of Racelab Global, an international supplier of racing wagering products and technologies.

BetMakers said the acquisition was highly strategic, adding leading race form, preview and statistics technology to its ecosystem alongside proprietary fixed odds pricing technology.

The business paid total consideration of A$1.5m for the acquisition, with a potential clawback of up to A$0.5m depending on key customer novation within the first 30 days.

BetMakers is also set to receive early termination fees from Australian operator Betr, which will no longer require the supplier’s services after being acquired by another brand, BlueBet.

BetMakers received an initial A$3.75m from Betr in March, which is set to be followed by further payment of A$2.25m by June and a further amount between A$1.5m and A$2m to be paid by September.

Additional amounts may still be payable to BetMakers depending on the performance of Betr’s operations prior to its customer migration.

Executive commentary

“We are continuing to execute on our strategy of enhanced operating discipline with the tightening of our operating expenses, and focus on higher margin, capital light revenue growth and profitability,” said BetMakers executive chair Matt Davey.

“There is substantial progress being made across the entire business, with new partnerships and new customers, as well as previously announced deals now going live, which are expected to contribute to the fourth quarter and beyond.

“The pipeline of new growth opportunities is the healthiest we have seen, so we look forward with confidence.”

CEO Jake Henson added: “The benefits from our transformation program continue to contribute to significantly reduced operating costs. This, combined with a much more streamlined operating model, have ensured the foundations are in place to achieve sustainable and profitable growth.

“There are several positive catalysts and a record pipeline of potential opportunities in train, all of which should continue to position BetMakers for an exciting future. 

“New contracts and partnerships are rolling out which should drive revenue growth, we are adding new capabilities to our offering, we have restructured less profitable contracts, and the development of our market-leading NexGen platform continues to progress.”

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