On Friday night, the UK gambling platform Football Index announced huge reductions in dividends, following new shares in players, issued just a few days before the major changes. This led to numerous angry customers who felt misled by the new shares that preceded the huge slump in dividends that led to the crash in the market on Saturday.
The thousands of customers of Football Index are expressing their infuriation due to the inability to sell their shares after the reduction announcement, at least not without suffering major losses. As a result, the betting platform received a huge wave of hate comments online, with Football Index even disabling the comment section on its Twitter account after staff members received several personal threats online.
Substantial Losses Force Football Index to Reduce Dividends
Many customers of the betting platforms expressed their frustration as they will most likely not be able to recover the huge amount they lost due to the reduction. Football Index shared a statement, showing its understanding of everyone’s frustration but noted that the rebuilding strategy came as a result of “substantial losses”.
Football Index gained huge popularity due to being a unique betting platform in the UK, allowing punters to trade shares in professional footballers. This was a great alternative to traditional football betting that many sportsbooks are offering and customers of the platform appreciated the stock market-like experience.
Due to its huge success, Football Index could be seen everywhere thanks to national advertisements on TV and even public transport in the UK. Like many other businesses, however, Football Index suffered huge losses during the Covid-19 pandemic. With the reduced profits during the critical months of the pandemic, the platform’s performance was negatively affected.
Football Index Shares Decline After the Surprising Announcement on Friday
After the announcement about the reduction in dividends last Friday evenings, the next day the company’s shares plummeted. Prior to the news about the huge dividend reduction, the company’s monthly report showed that only for the month of February, Football Index sold 15,000 new shares in the top eight players on the platform. Meanwhile, the total number of new shares that were issued across the entire exchange platform was nearing 300,000.
In addition to the 921,509 shares in Jadon Sancho that were already in exchange, the platform issued 2,400 new shares. Since the top Borussia Dortmund footballer traded at an average price of £7 for the month of February, estimations showed that Football Index’s revenue could reach £16,800 thanks to the newly issued shares.
As Football Index decided to issue new shares in major football players, many customers of the platform decided that this is a move taken to improve the liquidity of the company. The market update on 5 March, however, showed that Football Index decided to reduce most dividends to 2p or even 1p. This was a huge drop from the previous maximum of 14p and left many customers of the platform angry.
- Author
Olivia Cole
