Paddy Power Betfair stumbles on first quarter results

Revenue of £339m represented a 16% increase on the same period last year, had Betfair and Paddy Power been merged at the time, though this was a slower rate of growth than reported in separate results in March.

On the upside, earnings before interest, tax, depreciation and amortisation (EBITDA) jumped 27% to £59m, ahead of the 10% growth in both business reported at the time of final results, while operating profit sped 36% higher to £43m in the three months to 31 March.

Retail sales growth slowed to 5% but like-for-like (LFL) revenue was down 1% as the estate expanded by a net three shops to 601, while sportsbook stakes grew 9%. In the last full year, retail grew at 6% LFL in the UK and 11% in Ireland.

Faster growth was reported for the first quarter from the online operations, where revenues widened 17% to £195m, with sportsbook stakes up 23%.

Online revenue from regulated markets was up 21% and unregulated revenues fell by 14%, mostly due to the impact of exiting from Portugal last July.

Geographically, the fastest sales growth was from Australia, where revenue was up 25% to £58m, with sportsbook stakes up 31%.

US revenue meanwhile was up 22% to £20m, with 19% growth at the TVG wagering website bettered by continued growth in the online casino in New Jersey.

"All four of our brands − Paddy Power, Betfair, Sportsbet and TVG - continue to trade well in a highly competitive environment," said chief executive Breon Corcoran.

He added that the post-merger integration was on-track and that management remained confident of delivering their £50m-a-year target of synergy cost savings.

"A strong leadership team is in place and restructuring of the business has commenced. We are working to bring the best of each business to the combined group and customers are starting to see some early benefits as we roll out product features across the brands."