Olympics takes toll at Paddy Power but revenue rises 23pc
Punters wagered €30m during the summer Games in London
RACING cancellations and the London Olympics moderated Paddy Power's customer activity between July and mid-November but the company still reported a 23pc rise in net revenue for the period.
Paddy Power said that the decline in activity caused by cancellations and the Olympics was offset by favourable sports results that prompted a gross win percentage above normal expectations and ahead of the figure for the corresponding period last year.
Paddy Power customers bet €30m with the group on Olympic events this year – up from the €2.5m they wagered on the Beijing Olympics four years ago.
In an interim management statement issued yesterday, Paddy Power said that in Ireland its retail chain delivered a 0.4pc like-for-like rise in stakes made by customers; while net revenue at the outlets was up 8pc. The company's shops in Ireland have been hit by the damaged economy, with punters making smaller bets.
Paddy Power said it expects to have opened 45 new outlets in the UK by the end of the year. That will bring its portfolio there to over 200. The company also launched an online presence in Italy this summer that is thought to be performing strongly.
"Despite a competitive high-street environment, UK retail performed well, with like-for-like net revenue up 5pc, driven by strong sportsbook growth of 12pc, offsetting a decline in machine gaming of 4pc," said the company.
The firm said its online gaming channels are also proving to be popular, helping to drive growth in mobile use by its customers.
In October, Paddy Power's mobile turnover as a percentage of total online sportsbook sales was 27pc in Australia, compared to 25pc in June, and 45pc at paddypower.com, compared to 41pc in June.
"The most rapid mobile penetration continues to occur in gaming with mobile gross win in October accounting for 28pc of Paddy Power Casino and 25pc of Paddy Power Games," it said.
In Australia, Paddy Power's total online turnover was up 24pc in the latest period, with no slowdown in growth compared to the first half of 2012, said the company.
In the first half of this year Paddy Power made a €67.1m operating profit, up 13pc; while net revenue climbed 29pc to €311m.
Last month the company revealed plans to recruit up to 900 additional staff in Ireland by 2015. It already employs about 2,200 people here.
Analyst Gavin Kelleher, at Goodbody stockbrokers, said Paddy Power's second-half performance to date is "very encouraging".
"The sports book performance across the group is very positive and is running ahead of our expectations," he said.