Paddy Power Betfair (PPB) boss Peter Jackson says the company’s “scale, leading customer propositions and strong balance sheet” should protect it from any regulatory shocks this year, including a fixed-odds betting terminals tax in the UK, a decision on sports betting in the US, and point-of-consumption taxes in Australia. For now, these regions are growing ahead of such anticipated changes, with Australia’s 21 per cent sales growth leading the way last year. Interestingly, however, a ban on credit betting has come into effect there after the period end.
All games across the Paddy Power and Betfair brands have now been consolidated onto the same technology platform, so rolling out new products should become easier. Management also wants to spend an extra £20m during 2018 on advertising to improve market share, as well as help retain customers.
Analysts at Numis still expect EPS of 438p this year, up from 398p in 2017, although the brokerage believes downgrades are likely.
| PADDY POWER BETFAIR (PPB) | ||||
| ORD PRICE: | 7,950p | MARKET VALUE: | £6.73bn | |
| TOUCH: | 7,945-7,955p | 12-MONTH HIGH: | 8,965p | LOW: 6.635p |
| DIVIDEND YIELD: | 2.5% | PE RATIO: | 31 | |
| NET ASSET VALUE: | 5,196p* | NET CASH: | £244m | |
| Year to 31 Dec | Turnover (€bn) | Pre-tax profit (€m) | Earnings per share (¢) | Dividend per share (¢) |
| 2013 | 0.75 | 141 | 257 | 135 |
| 2014 | 0.88 | 167 | 301 | 152 |
| Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share | |
| 2015 (restated) | 0.79 | 125 | 240 | 180¢ |
| 2016 | 1.50 | 11.9 | -7.2 | 165p |
| 2017 | 1.75 | 247 | 258 | 200p |
| % change | +16 | +1972 | - | +21 |
| Ex-div: | 12 Apr | |||
| Payment: | 29 May | |||
| *Includes intangible assets of £4.3bn, or 5,119p a share | ||||
