Betfred posts 97% slump in post-tax profit as shareholders secure £50m dividend
Bookmaker notes Covid-19 impact and exceptional credit in 2020 as reasons for downturn as 59 shops are shuttered
Betfred recorded a 97% year-on-year fall in post-tax profit for the year up to 26 September 2021 as the company paid a £50.7m dividend to its shareholders.
Post-tax profit for the Warrington-based bookmaker plummeted from £165m in 2020 to just £5.3m in 2021, as the group cited the impact of Covid-19, a decrease in credit and losses for “fixed asset investments”.
Betfred’s retail operations were hampered by closures as a result of Covid-19, but did see customers shift to its online channels.
Betfred said: “Amounts wagered, turnover and EBITDA […] for the period has decreased due to Covid-19, as a result of the temporary closure of shops from November 2020 to April 2021, however, amounts wagered, turnover and EBITDA for internet operations has increased resulting in an overall increase.”
The privately-owned firm’s 2020 financials were boosted by the £97.7m tax rebate it received from HMRC relating to VAT paid on the group’s in-shop FOBT machines between 2005 and 2013, along with a credit of £4.1m in relation to impairments.
Elsewhere, the operator lost £22m in its “fixed asset investments” during the reporting period, compared to a £92.7m benefit from its investments in 2020.
Despite the significant decrease in profit, Betfred shareholders, including founders Fred and Peter Done, secured a £50.7m dividend payout for the period.
However, the group’s shareholders did not take out a dividend for 2020.
Additionally, Betfred customers wagered £6.9bn in 2021, up from the £6.5bn in 2020, while revenue remained flat at £526m compared to £524.9m in 2020.
Adjusted EBITDA rose 31.7% from £35.3m in 2020 to £46.5m for the reporting period.
Betfred confirmed it had closed 59 of its shops during the year, with the total number standing at 1,470.
“Loss-making shops are constantly reviewed and closed where the business feels necessary,” the company said.
Betfred’s directors saw their total renumeration package rise 26.9% from £1.2m to £1.5m, with the highest-earning director paid £456,000.
In June, Betfred took a majority share in South African operator LottoStar for an undisclosed sum.