Paddy Power, Betfair Online Revenue Grew 17 Percent But Shares Fall in Early Trading

Written by:
Aaron Goldstein
Published on:

Online revenue grew 17 percent year-on-year in the first quarter with sports-specific revenue growing by the same percentage amount.

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"This good start to the financial year is a credit to our colleagues, particularly at a time when we are bringing together two businesses. Our marketing, technology and operations performed well throughout the key spring racing period and we are now focused on preparations for Euro 2016," said Breon Corcoran, chief executive of Paddy Power Betfair.

The bookmaker said total net revenue for the quarter to the end of March was GBP339.0 million, up 16% year-on-year from GBP293.0 million. Earnings before interest, taxation, depreciation and amortisation grew 27% to GBP59.1 million from GBP46.7 million.

Shares fell 1.1 percent in early morning trading to €114 in Dublin.  They fell further by 2.1 per cent to €113.25 at closing.

Results, however, fell short of the £352 million that analysts in Davy had forecast.  Other analysts forecasted amounts just shy of the Davy number.

“At first glance, this morning’s release could cause alarm,” said David Jennings, an analyst with Davy, nothing that the ebitda result compares with expectation of £370 million for the full year. “However, once the seasonal profit margin trends exhibited last year are considered, it becomes clearer that the group can still meet expectations for the year, albeit with profitability back-end-weighted once again.”

March’s Cheltenham Festival helped contribute to some of the losses.

- Aaron Goldstein, Gambling911.com

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