Appetite for Paddy Power's shares was muted after the bookmaker's management warned that a poor run of sports results in the weeks since the last market update had affected its performance. Although this did not really have an impact on the half-year results, it may show up in later updates. If anything, this demonstrates the short-term vagaries of bookmaking, but more importantly for the Irish bookie the performance of its online division, particularly in Australia, still sets the pace for the industry.
Paddy Power's online segment increased net revenues by 41 per cent to €191m (£154m), but operating profits lagged behind - up 7 per cent to €48.5m - which reflected start-up losses on four new ventures. The Australian internet operation did best growing profits by 35 per cent to €13.2m. Paddy Power's well-honed marketing machine meant there 41 per cent more active online customers at 1.2m.
Meanwhile, better sports results in the first half meant Irish retail profits rebounded by 79 per cent to €9m; net revenue was 13 per cent higher at €57m in spite of smaller average bets. In UK retail, like-for-like net revenues grew 10 per cent to €47.8m, reflecting double-digit growth in the sportsbook.
Analysts forecasts are under review, but prior to these results Peel Hunt was forecasting full-year EPS of 236¢, up from 212¢ in 2011.
PADDY POWER (PAP) | ||||
|---|---|---|---|---|
| ORD PRICE: | 5,212¢ | MARKET VALUE: | €2.55bn | |
| TOUCH: | 5,175-5,250¢ | 12-MONTH HIGH: | 5,649¢ | LOW: 3,400¢ |
| DIVIDEND YIELD: | 2.1% | PE RATIO: | 19 | |
| NET ASSET VALUE: | 535¢* | NET CASH: | €186m | |
| Half-year to 30 Jun | Turnover (€m) | Pre-tax profit (€m) | Earnings per share (¢) | Dividend per share (¢) |
|---|---|---|---|---|
| 2011 | 232 | 56.7 | 100 | 30.0 |
| 2012 | 311 | 68.6 | 124 | 39.0 |
| % change | +34 | +21 | +24 | +30 |
Ex-div: 5 Sep Payment: 28 Sep *Includes intangible assets of €156m, or 319¢ a share £1 = €1.26 | ||||
