Sports betting drives revenue growth at Paddy Power Betfair
Paddy Power Betfair has cited growth within its sports betting division as one of the main reasons behind an increase in revenue in 2017.
In a preliminary results announcement, Paddy Power Betfair said revenue for the 12 months to December 31, 2017, amounted to £1.75bn (€1.95bn/$2.42bn), up 13% on a proforma basis from £1.55bn in the previous year.
The company said this growth was driven by a 16% year-on-year rise in revenue from its sports betting business.
Underlying earnings before interest, tax, depreciation and amortisation was also up 18% year-on-year to £473m, which is ahead of initial guidance of between £450m and £465m due to favourable sports results in the fourth quarter.
Elsewhere, underlying operating profit jumped 19% to £392m, while underlying earnings per share for the period jumped 20% to 398.0p, up 20% and underlying dividends per share improved by 21% to 200p.
Peter Jackson, chief executive of Paddy Power Betfair, said: “The business saw continued good growth in 2017, with operating profits increasing by 19%.
“Our Australian and retail operations performed particularly well, growing profits by over 40%.
"We saw the benefits of investing in our customer propositions in 2017, with Sportsbet launching a number of product features that give extra value to customers and Betfair moving to a clear market leadership position in its football pricing.
“Now the Paddy Power brand is operating with an improved product, we will increase marketing spend to align with its mass market positioning and step up the retention-focused investment that we started in 2017.”
Jackson added: “Our scale, leading customer propositions and strong balance sheet mean we are well positioned ahead of the regulatory and fiscal changes expected in the UK, Australia and the USA.
“Our strengths in operating efficiently and responsibly will enable us to build a business that can sustainably generate shareholder returns over the long term."
Related article: Paddy Power Betfair CFO to depart