Irish betting operator Paddy Power is crediting a stellar performance by its Australian division for pulling its butt out of the fire.
In an interim management statement issued on Tuesday, the Paddsters said trading from July 1 to Nov. 15 had been in line with expectations, with group revenue up 9% (up 5% on a constant currency basis).
The gain came despite unfavorable sports results and the previous year’s comparable period enjoying a boost from the second half of the FIFA World Cup. Despite these headwinds, the company assured investors that there will be a Christmas, as it still expects full year profit to show a “mid to high single digit” percentage gain over 2014.
Excluding Australian operations, online sports betting stakes rose 16% but revenue fell 12% due to those aforementioned dodgy results. This was partially offset by a 13% gain in gaming/B2B revenue, but overall online revenue still fell 3% year-on-year. All is not lost, as the company says its new in-house designed native iOS app has boosted stakes by 25% in its first two weeks, and its new Android and proprietary HTML5 web apps will debut in December.
It was a different story at the Australian Sportsbet operation, which saw betting turnover rise one-third and revenue up nearly one-quarter. The ranks of new customers swelled by 22% and in-play telephone betting stakes rose 38%, which is enough for Sportsbet to justify continued investment in its telephone operations.
Sportsbet recently launched its new Punters Club offering, which has already witnessed the birth of 5k betting clubs, leaving the company optimistic that the product will add a further boost to future revenue.
Paddy didn’t break out separate stats for its nascent Italian-facing business, saying only that revenue grew 3%, as strong growth in the gaming vertical offset adverse sports results. The gaming growth came courtesy of new proprietary slots titles from its Cayetano development studio in Bulgaria. Paddy continues to tightly manage costs as it implements operational improvements needed to ensure the Italian operation’s sustained growth.
UK retail revenue was up 9% thanks to a 16% rise in fixed-odds betting terminal (FOBT) revenue. OTC wagering handle was up 16% but those adverse results kept sportsbook revenue growth to a mere 1%. Irish retail reported betting stakes up 8% and revenue up 4%. Paddy added a net 14 shops during the period (seven in the UK, seven in Ireland).
Paddy offered a brief update on its proposed merger with UK-listed betting exchange Betfair, saying the relevant filings had been submitted to applicable regulators and shareholder documentation would be published in the coming weeks.
