Paddy Power Betfair H1 online profits soar 34%
Operator also expects to deliver cost synergies a year earlier than expected as it reports double-digit revenue and EBITDA growth
Paddy Power Betfair has reported a 34% year-on-year rise in H1 online profits as the operator announces plans to deliver £65m in merger cost synergies a year ahead of schedule.
The company’s online business recorded EBITDA of £140.1m for the six months ended 30 June 2016, up from £104.3m the previous year, following strong double-digit revenue growth during the period.
Online revenues increased 20% to £440m, boosted by a 21% and 20% jump in sportsbook and gaming revenues respectively. Paddy Power Betfair’s exchange and B2B businesses also reported 3% growth.
Meanwhile, the firm’s Australia-facing Sportsbet business recorded a 17% year-on-year increase in revenues, although adverse sports results led to a 10% decrease in underlying EBITDA.
Since the business was formed in February, Paddy Power Betfair has been busy integrating the two brands, including the appointment of a new management team, consolidating its technology resources and the closure of five offices.
Chief executive, Breon Corcoran, said he was pleased with how the merger had progressed to-date as the operator expects to exceed its planned £50m cost synergies target by £15m.
“The restructuring is now largely complete and the merger synergies are being delivered ahead of schedule.
“We are creating a world-class operation by exploiting the unique assets and capabilities of each legacy business, particularly in the key functions of technology, marketing and trading.
“While our industry remains highly competitive and is exposed to the prevailing economic and regulatory environments, our strong market positions, increased scale and enhanced capabilities positions us well for sustainable, profitable growth.”
Paddy Power Betfair’s H1 numbers today revealed group revenues were up 18% year-on-year to £759m after receiving a £22m boost from the Euro 2016 tournament. Underlying EBITDA was up 31% to £180.9m.
The operator also announced Paddy Power co-founder and former CEO Stewart Kenny has stepped down from his role as non-executive director on the board.
Kenny had previously served as chief executive until 2002, chairman from 2002 to 2003 and had remained a board member for the past 13 years.