Online betting growth reaps €56m profit for Paddy Power
Paddy Power said a surge in online bets helped it post a rise in profits today as it weathered a run of punter friendly sports results in the first six months of 2011.
The Irish bookmaker, which has 151 outlets in the UK, suffered a "right bashing" at the Cheltenham horse festival and a "bruising" Royal Ascot but said underlying profits were still 15% higher at €56.8 million.
It also handed back more than three million euros to punters following its pledge to refund losing bets on the UEFA Champions League final between Manchester United and Barcelona.
The initiative paid off in terms of acquiring new customers to its website, which grew operating profits by 25% to €45.3 million and now has 1 million account holders.
The company said a key driver of the growth was its "disproportionately" large share of the rapidly growing mobile betting market. During the half year, mobile turnover was up 279% to €157 million euros, with 35% of its online sportsbook customers transacting via their mobile phones.
Chief executive Patrick Kennedy said it had been "a great first half" for the company.
"The excellent performance of the online division and the success of our mobile offering stand out," he added.
The UK retail division benefited from the addition of 21 new outlets in the period as operating profits improved 59% to €4.7 million. It expects to open 35 to 40 shops annually in the UK, with the focus on competitive and prime high street locations.
Irish retail operating profits fell 44% to €5.1 million in the period due to continued difficult economic conditions and adverse sports results in racing, particularly Cheltenham where a record 13 winners were Irish trained and 21 were ridden by Irish jockeys.
This caused gross win - the amount left by losing punters - to fall by 8% to €51 million euros in the half-year period.