iGB Intelligence reports | Page 7

Part 1 – The UK market - November 2014 - September 2015 some quarters is that UK revenues outpaced its performance elsewhere. The market leader’s net gaming revenues topped £1.55bn in the year to March 2016 while operating profit hit £448.3m. We made the point in our Market Monitor from June that bet365 can lay claim to being the only true transEuropean operator in the market, and indeed, given the numbers in these latest results, it suggests the company is the only truly global operator. UK betting turnover Nov 2015-Sept 2015 Golf 1% Others 12% Financials 1% Dogs 2% Cricket 4% Horses 35% How this translates into the UK is abundantly clear; the company can outspend the opposition in terms of marketing (see the section on the marketing battle Tennis 10% later in this report) and can maintain its leadership, particularly in sports, through constant re-investment in the product. Never mind the gambling sector, bet365 remains the true unicorn of the UK internet scene. The UK Gambling Commission statistics November 2014 – September 2015 Football 35% Source: UK Gambling Commission 32% share. This is quite some gap but there are some caveats. The betting GGY figure includes pool betting, but it excludes the figures for betting exchange, which has total GGY of £124.7m and we know a majority of The sports split Due to the nature of the reporting from the the revenues will be from horseracing. Even so, the GGY figures indicate more clearly Commission, where there is a split between proprietary how the shape of the UK betting market has shifted and revenue share in the GGY figures, the best picture significantly and this will have ramifications for all of the revenue splits for each sport comes though the involved in both the betting and racing industries. staking numbers. Football’s primacy in GGY terms – in a summer as The total staking figures of £12.9bn show that, in turnover terms at least, horseracing maintains its leadership – just – at £4.55bn. This marks something mentioned without a major football tournament – is clear and growing. It leaves racing’s administrators in the unfortunate of a turnaround for the figures for the first five position of asking for a racing levy even as the product’s months, where horseracing trailed behind football importance to the bookies is fading. How it negotiates by £1.62bn to £2.11bn and it gives proof for why this situation will be interesting to observe, but it should the exercise in extrapolation from just the first five be added that, coincidentally, the figures for the 11 months was fraught with danger. By its very nature, months represent the period just before the introduction sport is seasonal and once the full horseracing flat of the British Horseracing Authority’s Approved Betting season is taken into account in the figures, it gives us Partner (ABP) scheme in October 2015. perhaps a truer reflection of horseracing’s worth to the bookmakers. Still, the picture painted by the 11-month Casino and bingo In our previous market monitor in the summer where numbers does pose questions regarding the long- we looked at the developing markets of Italy and term relationship between the bookmakers and Spain, we noted that it could be argued that the sign horseracing. The figures for GGY in the 11 months – of a fully open and mature online gambling market where the Commission strips out £395.1m of revenue was the primacy of the casino and gaming market in share – show that football is now the dominant revenue terms. This argument was partly driven by betting medium, by 45% compared with horseracing’s what we saw in the five month figures from the UK, iGaming Business Market Monitor – UK, Australia and Spain • September 2016 4