Winner all right - profit at Paddy Power Betfair up 22pc
Operating profit at Paddy Power Betfair increased by 22pc to £180m (€199m) in the six months to 30 June, compared with the same period last year, according to the group’s interim results.
The increased profit was driven by favourable Cheltenham results and foreign exchange movements.
Revenue at the group, which yesterday confirmed the departure of its chief executive Breon Corcoran, was up 9pc year on year to £827m (€914m).
Underlying earnings before interest, taxation, depreciation, and amortization (EBITDA) increased by 21pc in the six months to £220m (€243m), with the EBITDA margin up 3 percentage points to 27pc, compared with the same period in 2016.
Paddy Power Betfair reported particularly strong growth in the first three months of 2017, which it said was driven by favourable Cheltenham results.
The three months to 30 June was affected by the absence of a major football tournament and adverse sports results, the company said.
Earlier this year Paddy Power Betfair confirmed that 19 of the 28 races at the 2017 Cheltenham Festival were profitable for the company.
Commenting on the results today outgoing CEO Breon Corcoran said the company was continuing to make substantial investments in technology to improve efficiency and minimise the cost of servicing its customers and to further "enhance the customer proposition".
"In the first half [of 2017] alone, customers enjoyed approximately £30m of extra value through better odds, more generous offers and new loyalty benefits.
Operating efficiency and the annualisation of merger-related cost savings resulted in strong operating leverage in the period, with operating profit up 22pc," Mr Corcoran said.
The company said that it expects its full year underlying EBITDA, including £15m of losses in DRAFT, to be between £445m and £465m.
DRAFT, a US-based daily fantasy sports operator, was bought by Paddy Power Betfair earlier this year for an initial cash cost of the investment is $19m (€17.4m).
A further contingent consideration of up to $29m (€27m) will be payable over the next four years depending on the financial performance of DRAFT.
Shares in Paddy Power Betfair closed down 5.17pc in Dublin yesterday after the company confirmed chief executive Breon Corcoran will depart.
The company told the market yesterday that he would be replaced by payment processor Worldpay's UK boss Peter Jackson.