Paddy Power upwardly mobile after record profits

BOOKMAKER Paddy Power is launching social media gambling and mobile casino products following a record first half that delivered profits of €69 million.

Paddy Power’s customers wagered a total of €1.05 billion with the company in the first half of 2012, 36 per cent more than during the first half of last year, when they bet €771 million.

Its net revenues for the first six months, which include the amount won from its customers, casino gaming, commission from games such as poker and services delivered to the French tote and British Columbian lottery, rose 34 per cent to €311 million from €232 million during the same period in 2011.

Operating profit rose 15 per cent to €67.1 million. First-half pretax profit rose 21 per cent to €68.7 million in 2012 from €56.8 million in the first six months of last year.

The company spent €6 million on a number of developments, including the launch of its Italian online business and two new betting products, Roller, a mobile and tablet casino brand, and Betdash, a social media-based sportsbetting game.

The company is close to formally launching both products. It said yesterday that it expected them to begin contributing to revenues in the second half of the year, along with products developed by Cayetano, the gaming specialist it purchased in 2011.

The group launched its Italian website in May, which took up the bulk of its development spend. Chief executive Patrick Kennedy said yesterday that Paddy Power now had a 4 per cent share of the market there.

He noted that Italy was Europe’s biggest gambling market. The launch took place in time for the Euro 2012 football championship.

Across the group, Paddy Power customers wagered €70 million on the European championships, which delivered €6.1 million in winnings to the bookmaker.

Its combined online businesses, Paddypower.com, Sportsbet in Australia and services provided to the French Pari Mutuel Urbain and British Columbian lottery in Canada, delivered just over €195.1 million in net revenues.

Online net revenues include sports-betting winnings, casino games and its French and Canadian businesses.

The Australian division was responsible for €67.2 million in net revenues, an increase of 47 per cent, and €13.2 million in operating profits, which were up 35 per cent.

The rest of the online division, which includes Britain and Ireland, delivered €127.9 million in net revenues, an increase of 36 per cent.

Operating profit was down 2 per cent to €35.9 million.

Mr Kennedy pointed out that the fall was due to the €6 million development spend.

The group’s Irish retail business, made up of 211 bookie shops in the Republic, delivered a 13 per cent increase in net revenues to €57 million and a 79 per cent growth in operating profits to €9 million.

The recession has hit this division hardest. The company attributed the improved performance to the fact that sports results swung in favour of bookmakers rather than punters during the period.

Those punters bet €474 million in its Irish shops during the period, 2 per cent less than in the first half of last year. Within that, the average amount bet fell 7 per cent to €15.79.