Online business drives Paddy Power

Pre-tax profit at bookmaker Paddy Power rose 15 per cent in the first half of year, driven by online activities and international business.

Shares in the company fell by 2.1 per cent on the Dublin market this afternoon.

The company reported underlying profit before tax of €56.8 million for the six-month period ended June 30th and said diluted earnings per share were 97.1 cent, 18 per cent higher than a year ago.

Online activities accounted for 81 per cent of operating profit during the period, compared with 73 per cent in the first half of 2010. Paddy Power provides online gaming in regulated markets in UK, Australia, Ireland and France.

The group said it substantially increased online scale during the period, with the gross win up 28 per cent to €143 million. Operating profit rose 25 per cent to €45.3 million in the online sector.

On Paddypower.com, active customers rose by 48 per cent, while gross win rose 35 per cent to €101.1 million. The mobile sportsbook turnover surged by 279 per cent.

The online Australia division saw profit grow by 15 per cent on a constant currency basis to €9.8 million.

In the retail sector, operating profit fell 44 per cent to €5.1 million in Ireland, driven lower by adverse sports results, with like-for-like sportsbook stakes down 1 per cent.

In the UK, retail operating profit was up 59 per cent to €4.7 million, with like-for-like stakes up 6 per cent and machine gaming revenue 16 per cent higher. The group has opened 27 shops in the UK so far this year.

Chief executive Patrick Kennedy described it as a great first half for the company. "The excellent performance of the online division and the success of our mobile offering stand out," he said. "We have continued to experience strong growth in the UK Retail market and our Australian business has progressed well."

He said the company was confident in its 2011 prospects, despite conditions in Ireland remaining tough.