Group Strength…Paddy Power Betfair delivers solid Q3 2017, upping its full-year guidance

Breon Corcoran

FTSE100 betting group Paddy Power Betfair Plc (PPB) has delivered a positive Q3 2017 trading update (period ending 30 September), prompting the group to lift its full-year earnings expectations as the company undertakes a leadership transition.

A strong period sports betting performance for PPB’s online and retail divisions saw the firm record a 9% increase in group revenues of £440 million (Q3 2016: £404 million). PPB governance highlighted that its sports betting division had delivered growth despite competing against a tough comparative period featuring UEFA Euro 2016.

PPB’s strong revenue momentum would see the betting firm deliver a period underlying EBITDA of £121 million, up 7% on Q3 2016’s £113 million. Closing its trading period, PPB governance would declare corporate operating profits of £101 million (Q3 2016: £95 million).

Updating the market, PPB governance now targets a 2017 full-year corporate EBITDA of between £450-£465 million.

PPB leadership would detail that its strong H2 2017 performance has highlighted the firm’s enlarged strengths and combined dynamics in group betting operations, international expansion and marketing.

At present, the firm is completing the integration of its combined technology platform, which will see Paddy Power deliver new sportsbook desktop and mobile products. PPB governance expects to fully migrate customers onto its integrated platform by early 2018.

Presenting his last Paddy Power Betfair trading update, Group CEO Breon Corcoran commented on Q3 2017 performance:

“Q3 was an encouraging quarter for Paddy Power Betfair, with good stakes growth despite the absence of a major football tournament.

Our international businesses performed particularly well. In Australia, the winning combination of innovative product and marketing excellence continued to deliver exceptional results, with revenue up 29%, while US revenue was up 18%”

Paddy Power Retail also continues to outperform the market through its sports-led proposition and is well positioned to respond to regulatory changes.

The Group’s strong marketing capability was demonstrated once again ahead of the highest profile betting event of the year, the Mayweather-McGregor fight in August. Paddy Power’s infamous Lucky-Pants were on the ‘Money’ at the weigh-in, while Sportsbet and DRAFT leveraged Mayweather’s endorsement to drive high levels of customer engagement.

The integration of our technology platforms is nearing completion, and in 2018 customers will start to benefit from an increased pace of new product delivery across our Betfair and Paddy Power brands.”

Closing its trading update, PPB governance confirmed that former WorldPay CEO Peter Jackson would take full responsibility of group leadership on 8 January 2018. Breon Corcoran continues as group CEO until that date, overseeing the firm’s leadership transition.

Paddy Power Betfair – Q3 2017 Performance Overview

 

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