The governance of Paddy Power Betfair Plc (PPB) has stated that it is confident of securing 2017 group targets and expectations following a strong start to its financial year aided by favourable results recorded at Cheltenham 2017.
Presenting its Q1 2017 trading update (period ending 31 March), PPB declared underlying group revenues of £416 million up 23% on corresponding Q1 2016’s £339 million. The firm’s opening performance was further helped by the decline in value of pound sterling during the period.
The FTSE-listed bookmaker would detail a strong performance of its sportsbook division which recorded period revenues of £326 million up 28% on Q1 2016’s £254 million.
Boosted by its sports betting activity, PPB would declare a period underlying EBITDA of £111 million nearly doubling the earnings results of £58 million reported in Q1 2016, representing an EBITDA margin of 27% (Q1 2016: 17%)
Closing its Q1 2017 corporate performance, PPB governance would declare an underlying operating profit increase by 114% to £91m (Q1 2016: £42 million).
Paddy Power Betfair Chief Executive Breon Corcoran, commented on Q1 2017 performance
“Reversing the trend of the past two years, results at Cheltenham 2017 favoured bookmakers and this contributed to good revenue growth. Combined with the annualisation of merger-related cost savings and continued focus on operating efficiency, this resulted in a doubling of operating profits in the first quarter.
Since then, however, at high-profile events such as the Grand National, Premier League football and the US Masters, results favoured customers, and overall gross win margins were weak in April.
A key strategic focus for 2017 is the integration of our technology platforms. This project is on track and we expect both our European brands to be operating on a common platform by the end of the year, at which point customers will start to benefit from increased pace of new product delivery.”
Paddy Power Betfair Q1 2017 performance overview