Morana rules out Betfair CEO post
Chief financial officer tells eGaming Review he will not apply for top job following David Yu's announcement last week.
Stephen Morana has ruled himself out of replacing David Yu as CEO of Betfair, the exchange’s long serving chief financial officer has told eGaming Review.
In an interview yesterday following Betfair’s first annual results presentation since its ill-fated October floatation, Morana said he had spent “a lot of time” talking to the board but that he was clear he would not be putting himself forward for the £500,000 role.
“I’ve been very clear in my take. I am very committed to Betfair. I think the best thing that I can do for Betfair is stay in what I think is a huge job as the CFO. I won’t be putting my name forward. I’m here to act as a transition between what will happen over the next period of time and driving the business forward.”
Yu, who has held the top position for six years and been with the business for a decade, announced last week he would not renew his contract which ends in October 2012. Speaking to eGaming Review yesterday he reiterated there was no timeframe as to when he would leave saying only he would “stay on for as long as the board needs me.”
“What we’ve announced is that I don’t intend to renew my contract and by being open and transparent about it so we can start the process and find a great candidate. We know these things take time, we’re in no rush and we won’t be rushed into it.”
Industry commentators are split as to what type of candidate Betfair will eventually hire to replace Yu, however it is thought the company will favour a proven PLC executive with clear leadership skills rather than a gambling veteran.
Asked what type of chief executive he would favour Yu, who is helping with the recruitment process alongside at least three headhunting firms, said it was too early to say but added that he was a large shareholder and, as a result, his preferred candidate would be someone “who’s as passionate about the business as I’ve been”.
Yu admitted the course of the year “hadn’t been perfect” and that a number of issues, both external (regulation) and internal (poker migration, LMAX) were things “we didn’t get quite right.”
The outgoing CEO, however, told eGaming Review he was upbeat about the company’s future growth plans including integrating more fixed odds sports betting products into the exchange to provide its “very loyal” customers with a single source on which to bet on sports, rather than leaving the site and betting elsewhere.
“”We think we have 72% of our customers’ current sports betting wallet. There is an opportunity to add in sports book-type markets around this. We know they are spending money elsewhere. Some customers have multiple accounts, and we want them to spend more with us. We’ve added other products over the years such as multiples and Tote betting, what we’re now going to do is add in fixed odds products around our core exchange and going to be integrating this together with the exchange.”
Yu said this would be done by the “back end of this year” suggesting Betfair would build most of this itself but adding that it had also lined up a number of unnamed third parties to help achieve this target date.
“It also gives us more flexibility as we deal with regulatory challenges because it gives us more flexible products to look at different markets and we can enter in with whatever products are allowed.
Betfair’s sports revenues for the year grew by 10%. Activity on the exchange also grew, with the number of bets matched, matched volume and total customer losses all increasing by around 20%.
Football revenue was up 24% and is now Betfair’s largest contributor to its sports revenue for the first time overtaking horse racing. Over the year, revenue from football generated 42.3% of sports revenues, horseracing 42.1%.
Yu called mobile a “bright spot” with 34% of its customers having used one its mobile betting products, delivering 5% of its sports revenues and more than £1bn worth of bets placed via the company’s mobile products in the last financial year. “We’ve made big investments in the business that will set us up well for the future in terms of our sports as well as our portfolio product.
“There have been issues, the poker migration [from its own software to the now for-sale Ongame] and the outage in March, affected revenue growth and customers, while horse racing was a drag on the business last year but we’ve put more effort into that and launched new products and more content,” added Yu.
“So, overall we’ve fixed the internal issues and we’ve got a plan for growing the business, improving our margins and continuing to deliver to shareholders.”