BUSINESS

Paddy Power Betfair blame slow H1 growth on punters getting it right

TAGs: Breon Corcoran, paddy power betfair

Paddy Power Betfair has released their H1-2017 financial report, blaming slow progress on the lack of a major football event, and adverse sports betting results as the punters pick the favourites, and the favourites do what favourites do.

Paddy Power Betfair released their H1-2017 numbers, resulting in a 5% bumpy slide down the FTSE 100.

The blow came a day after Sky News reported that Paddy Power Betfair’s CEO, Breon Corcoran, was set to leave the industry; a report that immediately saw the shares fall 8.5% from Friday’s closing value. It was their lowest point in the past two years. By the close of play, the damage was a 4.67% dip to $75.50.

Paddy Power Betfair blame slow H1 growth on punters getting it rightRevenue growth was up 9% YOY to £827m, but this included a £40m present thanks to the weak performance of sterling since the decision from the old folk in the UK to leave the European Union. The cost of sales was up 8% to £189m. Operating costs were up 4% to £419m.

Gross Profit was up 9% to £638m, EBITDA was up 21% to £220m, EBITDA Margin was up 3% points to 27%, and Operating Profit was up 22% to £180m.

Although there is growth, it has significantly slowed down as the first half of the year has progressed. The online giant has blamed this handbrake on the lack of a major football tournament (Euro 2016 contributed £22m in sales), and adverse sports betting results because of the return to form of the Premier League big boys and the favourites in the Cheltenham Festival.

The nitty gritty saw total revenue from the online side of the business come in at a flat £439m, Australian revenue was up +34% to £173m, and retail revenue came in at £160m, an increase of 9%.

Delivering his last earnings quote before leaving the industry, Corcoran, said that the focus continues to be ironing out the kinks of the £6 billion merger, and pushing their technological edge to reduce the cost of servicing the customer while making their lives a whole lot better.

Former Worldpay CEO, Peter Jackson, will replace Corcoran as CEO. A transition date is unknown.

The forecast is for Paddy Power Betfair to land somewhere between the £445m, and £465m earnings mark.

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