Paddy Power delivers strong HY1 results

On the back of a possible merger announcement with Betfair , Paddy Power plc has reported a 33 percent rise in operating profit for the six months ended June 30, 2015.

Key group performance highlights include:

–    Operating profit growth of 33 percent to Euro 80 million, or 68 percent before Euro 32 million in new taxes and product fees;
–    Net revenue up 25 percent with strong double digit growth across all Online and Retail divisions;
–    Diluted EPS up 31 percent to 144.8 cent;
–    Euro 391 million returned to shareholders through B Share Scheme;
–    Interim dividend up 20 percent to 60.0 cent per share;

Online Highlights:

–     Net revenue growth of 34 percent to Euro 345 million, with sportsbook up 42 percent and eGaming up 14 percent.  Operating profit up 45 percent to Euro 70 million:

–    Online (ex Australia): net revenue up 26 percent to Euro 200 million with sportsbook up 37 percent and eGaming up 14 percent.  Operating profit increased by 21 percent to Euro 31.6 million, despite Euro 28 million in new taxes;

–    Online Australia: Sportsbet is now the largest online brand in Australia, driven by accelerated market share growth with sportsbook net revenue up 46 percent to Euro 151 million and stakes up 37 percent.  Operating profit increased 69 percent to Euro 38.8 million;

–    Italy:  Substantial operational improvements in Italy, where net revenue grew by 24 percent, and operating costs fell by 19 percent.  Operating loss reduced by Euro 4.2 million to Euro 4.7million;

–    Mobile net revenue accounted for 67 percent of online revenue, with 78 percent of active customers transacting via mobile.

Retail Highlights:

–    UK Retail net revenue up 21 percent (9 percent like-for-like).  Operating profit up 3 percent to Euro 12.0 million despite Euro 2 million of additional Machine Gaming Duty and the negative impact of new machine regulation.  Estate now 336 shops with a net 13 units opened in the period;

–     Irish Retail net revenue up 14 percent (10 percent like-for-like).  Operating profit up 36 percent to Euro 10.6 million.  Estate now 252 shops with 7 units opened in the period.

Paddy Power said it expected to be ahead of 2014 and market forecast in terms of operating profit for the full year 2015 period.

“We have made substantial progress implementing the strategy we set out in March, with further payback to come from new mobile product releases, refreshed marketing campaigns and efficiency gains,” commented Andy McCue, chief executive of Paddy Power plc.

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