Pointsbet books $178 million loss as Betr takeover talk intensifies

Sports betting group PointsBet booked a net loss of $178 million in the latest half even as its business in the US soared by almost 90 per cent. The result comes amid growing speculation about new-kid-on-the-block Betr taking over its Australian arm.

The bookie widened its statutory loss before interest, tax, depreciation and amortisation – the metric closely watched by investors – to $163 million over the six months to December, up 25 per cent on the first half of financial year 2022.

PointsBet confirmed in December that it was in preliminary discussions about selling its Australian business to News Corp-backed wagering startup Betr, but has not spoken publicly about the potential sale since.

Industry sources have told this masthead the deal is close to completion, amid News Corp’s growing discontent about the costs of Betr, which totalled about $US33 million ($49 million) over the past six months. Betr has engaged financial services firm Barrenjoey to secure the funding needed to acquire the Australian arm of PointsBet, as first reported by the Australian Financial Review. The deal is understood to be worth up to $250 million.

PointsBet has also been pumping money into expanding its market share in the US since 2019 and is now active in 14 states, as well as Ontario in Canada. The US arm grew by 86 per cent over the December half, a figure largely attributable to years of heavy marketing spending, despite a 17 per cent reduction in marketing expenses in the latest half.

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Chief executive Sam Swanell said earlier this month the company’s marketing expenses should decline to US$90 million this year, down from $US118 million in 2022, after it extended an existing partnership with NBCUniversal and stretched its current expenditure to go over four years, up from two.

More to come.

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