Irish bookmaker Paddy Power has announced its preliminary financial results for last year showing a ten percent rise in earnings alongside a five percent growth in operating profits to €75.7 million.
The Dublin-based firm reported that its cash balance had decreased from €88 million to €77 million while its increase in operating profits was achieved despite a five million Euro ‘headwind’ due to adverse currency movements.
Paddy Power revealed that the operating profit of its online division rose 34 percent to €42.8 million to account for over 70 percent of its total operating profits for the second half of 2008 and 57 percent for the year.
Operating margins for its online businesses also increased seven percent as a percentage of gross win to 41 percent despite investment in its products and competition from newer businesses.
“While online gaming revenues showed the stronger growth, sportsbetting remains our bigger revenue stream,” read a statement from Paddy Power.
“We see this as a positive in the intensely competitive online market given that sportsbetting is generally accepted as the largest individual segment with the highest potential for product differentiation and hurdles for new entrants.”
'We have grown earnings per share by ten percent in 2008 despite the challenging environment,” said Patrick Kennedy, Chief Executive Officer for Paddy Power.
“Our online operations performed particularly strongly with a 48 percent increase in operating profit in constant currency. The results in the second half of 2008 also demonstrates the success of our strategies of geographic and channel expansion with online operating profit accounting for over 70 percent of group profitability and profits from UK customers almost half of group profitability.
“The group faces a number of headwinds again in 2009 as has already been reflected in consensus expectations. In that context, the year has got off to a satisfactory start and we remain confident of the group’s prospects.'