Betfair shares soar as profits beat forecast
Shares in UK gaming group Betfair, which is headed by former Paddy Power executive Breon Corcoran, soared as much as 18pc after it raised its profit guidance and delivered strong third-quarter results.
The betting exchange group said that its revenue rose 20pc to £114.6m (€158.1m) in the third quarter of its financial year, while earnings before interest, tax, depreciation and amortisation (EBITDA) were 17pc higher at £23.6m (€32.5m).
That profit figure was 36pc more than analysts predicted and was generated despite the company incurring a £7m negative impact from a new UK tax on profits made from bets by customers in Britain.
Excluding that duty, the profit figure would have been 51pc higher.
Betfair also said that it expects to make full-year EBITDA of between £113m and £118m (€155.9m to €162.8m). That's over 15pc higher than had been expected by some analysts.
"We are entering one of the key periods in the sporting calendar and are focused on finishing the year strongly," said Mr Corcoran, who's a former chief operating officer at Paddy Power. He took over the chief executive role at Betfair in 2012.
He said that the company is carrying "continuing momentum" into its final financial quarter.
The next few couple of weeks see a number of key horse-racing fixtures including Cheltenham, while Mr Corcoran said Betfair is also set for "record levels" of political betting around a closely contested UK general election on May 7.
Analyst David Jennings at Davy Stockbrokers said he continues to see "excellent scope" for further positive earnings momentum at Betfair.
"It seems inevitable to us that the business will continue to exceed its own medium-term guidance... for some time to come," he said.