BetMakers is continuing its cost-reduction strategy for the upcoming fiscal year, following positive outcomes in the previous quarter.
The plan was declared in their most recent report and seeks to lower expenditures and conserve funds throughout the organization.
BetMakers had previously cautioned about a challenging year ahead due to prior investments.
The reorganization plan commenced a month ago and has already exhibited positive progress. This encompasses a substantial decline in cash outlays.
BetMakers also trimmed its workforce by 15%, decreasing the number of personnel from 568 to 485. They anticipate having 440 employees by the conclusion of the restructuring.
“This period demonstrates progress as we concentrate on decreasing costs and streamlining our operations,” stated BetMakers. “We will maintain this strategy in the next period.”
BetMakers Reports Robust Fourth-Quarter Outcomes
Earnings for the period ending June 30 hit A$24.8 million (equal to £12.9 million/€15.1 million/$16.6 million). This signifies a 5% dip compared to the $26.2 million reported in the final quarter of 2022, but a 5% rise compared to the $23.6 million reported in the third quarter of the current year.
BetMakers did not unveil a detailed breakdown of its earnings, but the firm did outline cost-cutting measures. These steps encompassed the company’s operational and investment activities in the final quarter.
Overall operating cash outlays dropped by 6% quarter-over-quarter to $26.9 million. Staff expenses, the operator’s largest expenditure, fell by 4%, while product manufacturing and operational expenses declined by 10%. Administrative and corporate costs remained steady.
In contrast, net cash outlays from investment activities increased substantially quarter-over-quarter, with spending rising across all areas. Fixed assets, plant and equipment costs climbed due to the launch of the new BetLine betting terminal, while the increase in acquisition costs was due to the final payment for the TexBet acquisition and historical due diligence expenses.
Furthermore, other investment-related costs were attributed to changes in customer deposits related to the global lottery and prepaid betting business.
Cash and cash equivalents at the start of the final quarter were $56.2 million. After accounting for net cash flows of $15.2 million (total outflows less inflows), $41 million remained at the end of the final quarter.
Full-year growth and cost-cutting
BetMakers did not provide specifics about its final quarter performance, but did release some full-year data. This included the announcement of $99.
Earnings reached $100 million, a rise of 8% compared to $91.6 million in the previous year.
Overall operational cash outlays totaled $119 million. After subtracting income, net cash generated from operating actions was $19.9 million.
Net capital expenditures were $18.7 million, and BetMakers also mentioned that net cash used in financing activities was $8.4 million.
Cash and cash equivalents at the start of the year were $87.6 million, and at the end of the year, they were $41 million, as reported in the fourth quarter.
In addition to altering its operational approach, BetMakers also made significant adjustments to its management team in the 2023 fiscal year.
In January, Todd Buckingham stepped down from his position as Chief Executive Officer to assume the new role of Chief Growth Officer. Meanwhile, veteran gambling industry executive Matt Davey was appointed as President and Executive Chairman.
Other changes included Jake Henson being named as Chief Executive Officer, Chelsey Abbot as Chief Human Resources Officer. Additionally, Christian Stuart resigned from his position as Chief Executive Officer of North America in April.
Despite cost-cutting measures, mergers and acquisitions appear to be a key component of the operator’s long-term growth strategy.
In November, BetMakers completed the acquisition of ABettorEdge, which operates under the name Punting Form. The deal was finalized just over a week after the transaction was announced.
BetMakers considers the acquisition “strategically important.” The company stated that the addition of Punting Form will further strengthen its position as a leading provider of B2B data and technology services for horse racing.
Horse racing split times and benchmarks are generated by Punting Form’s unique technology and artificial intelligence. These are incorporated into a system that ranks horses based on their pace. This service is utilized by professional wagering groups, gambling enterprises, content producers, and racing specialists.
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