It's clear that the recent merger of Paddy Power Betfair (PPB) has left the now-combined entity's full-year figures a little discombobulating. Excluding merger fees, integration and restructuring costs and amortisation of merger-related intangible assets, adjusted pre-tax profits actually rose 139 per cent to £316m. A clearer picture is probably provided by underlying cash profits, which rose 44 per cent to £330m. This left adjusted EPS up by a similar rate to 331p. These numbers, as opposed to the statutory results, demonstrate what chief executive Breon Corcoran calls the most important determinant of the group's long-term success: scale.
Analysts at Numis homed in on the group's online division, specifically gaming, which suffered a slowdown in revenues during the final quarter. This was the result of lower activations on the Paddy Power brand, less cross-selling and reduced VIP activity overall. "Customer-friendly" football results also held back trading. Still, overall revenue was up 11 per cent in 2016 at constant currencies. So far in 2017, the online segment is 9 per cent ahead on the same measure.
Analysts at Peel Hunt expect pre-tax profit of £400m for 2017, giving EPS of 391p (up from £327m and 331p in 2016).
PADDY POWER BETFAIR (PPB) | ||||
---|---|---|---|---|
ORD PRICE: | 8,340p | MARKET VALUE: | £7.01bn | |
TOUCH: | 8,330-8,350p | 12-MONTH HIGH: | 10,020p | LOW: 6,525p |
DIVIDEND YIELD: | 2% | PE RATIO: | na | |
NET ASSET VALUE: | 5,133p* | NET CASH: | £36m |
Year to 31 Dec | Turnover (€bn) | Pre-tax profit (€m) | Earnings per share (¢) | Dividend per share (¢) |
---|---|---|---|---|
2012 | 0.65 | 139 | 251 | 120.0 |
2013 | 0.75 | 141 | 257 | 135.0 |
2014 | 0.88 | 167 | 301 | 152.0 |
Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share |
2015 (restated) | 0.79 | 125 | 239.9 | 180¢ |
2016 | 1.50 | 11.9 | -7.2 | 165p |
% change | +89 | -90 | - | - |
Ex-div: 6 Apr Payment: 24 May *Includes intangible assets of £4.47bn, or 5,318p a share |